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New refinery floated for western North Dakota

An oil well pumps at sunrise in western North Dakota's Bakken Formation. Forum News Service file photo

BISMARCK — A new refinery has been proposed for oil-rich western North Dakota, prompting questions from a local township chairman.

AIC Energy Corp. filed an application earlier this month with Williams County planning and zoning officials. It described the so-called "Bakken Oil Refinery" as a 28,000 barrel-per-day biofuel facility located along Highway 1804 southwest of Trenton near the Montana border.

AIC President John Melk declined to comment when reached by phone Monday, Nov. 26.

“We’ll release a comment when it’s appropriate,” he said.

The refinery would use Bakken oil and "various locally sourced fuel feedstocks including agricultural products and waste oils," according to an AIC executive summary provided by county officials. Its primary customers would be "advanced manufacturing and commercial enterprises," and its products would include diesel, kerosene, gasoline and biofuels.

AIC said the refinery would provide at least 12 permanent jobs and 14 to 16 "support staff" on top of a minimum of 200 construction jobs.

"This project, if developed, could dovetail with our efforts to diversify our regional economy and increase the region's economic resilience," Everette Enno, executive director of the Tri-County Regional Development Council, wrote in an endorsement letter included with the application materials.

But Mike Casler, chairman of the Buford Township board, raised skepticism about the project due to AIC's apparent ties to Chinese firms and the potential effects on a creek that he described as a tributary to the Missouri River. He said the township has not made any decisions on the project ahead of a Dec. 5 meeting.

"We're just doing some research on who's making the application," he said.

Melk, the company's president, is an enrolled member of the Turtle Mountain Band of Chippewa whose work history includes managing the Mandan oil refinery "for three major turn-around retrofit upgrades," according to AIC's website.

AIC's website summarizes its involvement in oil and gas exploration and development in China and Kyrgyzstan as well as a seismic survey to identify potential oil and gas resources in Montana.

AIC's application lists a Las Vegas mailing address but North Dakota business filings state that its principal office is in Trenton, which is about 15 miles from Williston.

Terry O’Clair, director of the state Department of Health’s air quality division, said another company received an air quality permit for a refinery in the area several years ago, but the project was never built.

"We always hear rumors about somebody talking about things up there," he said. "But we haven't gotten anything officially."

The Trenton refinery comes amid plans for a larger facility near Belfield. That project’s proximity to Theodore Roosevelt National Park has attracted legal action from environmental groups.

North Dakota, which is the nation’s second-largest oil producer, currently has two refineries with a combined capacity of 88,000 barrels per day, said North Dakota Pipeline Authority Director Justin Kringstad.

Ron Ness, president of the North Dakota Petroleum Council, said he was unaware of AIC’s plans. He said it typically makes more sense to ship raw crude oil out of the state to be refined, but North Dakota could find a niche market in meeting regulations like California’s low carbon fuel standard.

“It’s all about finding a market,” Ness said. “It doesn’t matter whether you’re making gasoline, diesel fuel or potatoes or beer.”

The refinery project is slated for a Dec. 20 meeting of the Williams County Planning and Zoning Commission.

John Hageman

John Hageman covers North Dakota politics from the Forum News Service bureau in Bismarck. He attended the University of Minnesota in the Twin Cities, where he studied journalism and political science, and he previously worked at the Grand Forks Herald and Bemidji Pioneer.  

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