Utah Oil Sands Project Approved By State's Division of Oil, Gas & Mining Could Be Nation's First
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SALT LAKE CITY — A top Utah regulator approved plans Monday for the first commercial U.S. oil sands project.
John Baza, director of Utah's Division of Oil, Gas & Mining, upheld an earlier decision by his staff to give Earth Energy Resources Inc. a permit to mine a 62-acre pit in eastern Utah.
Environmental activists had objected to the project and demanded a hearing held by Baza in July.
Baza concluded Monday that his staff followed all of the legal requirement in giving its approval for the tar sands project a year ago.
The company is still trying to raise $35 million for the project, said Glenn Snarr, president and chief operating officer for Calgary, Alberta-based Earth Energy, which needs only the local approval of Grand County to get started.
"We are working on (funding ) actively with a few parities and hope we're getting closer to putting a shovel into the ground," he said Monday.
Opponents, who argued that the project would dig up fragile topsoil and pollute groundwater, can still appeal Baza's decision to a state board.
One of them, John Weisheit, a Colorado River guide and founder of Living Rivers, didn't immediately return a message Monday from The Associated Press.
Baza's personal review was unusual. He normally leaves decisions about mining permits to a staff of engineers and scientists and doesn't sign off on approvals for permits. He agreed to hold a protest hearing to take objections from Grand County residents and environmental groups. The groups promised not to file a formal appeal to a state board pending Baza's review.
Baza said his only role was to "make certain proper procedures were followed" by his staff of professionals.
Earth Energy insists it won't pollute anything and will leave Utah's oil sands as clean as beach sand after processing with a citrus-based solvent.
The company plans to truck the waxy crude to Salt Lake City for refining.
"It will be a good project for Utah," company vice president Barclay Cuthbert testified in July at the protest hearing. "We'll be providing energy that will be used in the state."
The company plans to produce bitumen, a tar-like form of petroleum, from oil-soaked sands. For decades, other Utah operators have used oil sands as a poor-man's asphalt, but nobody has tried to produce petroleum from U.S. oil sands on a scale planned by Earth Energy.
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PAUL FOY 09/13/10 08:30 PM ET Associated Press