Major permitting on track for soybean plant, AGP says

Much of the permitting has been granted for an Ag Processing Inc. soybean plant that will be built on the northeast edge of town, according to the company.

Regulatory approval has gone extremely well so far, CEO Keith Spackler said in a news release.

Ag Processing Inc. is commonly known as AGP. In November 2015, it announced plans to build a soybean processing plant in Aberdeen.

Decisions have been made for all of the “bigger-ticket items”, said Matt Caswell, AGP vice president member/corporate relations. A few conversations will also be needed through the construction phase.

“Even when you’re constructing, you’ll still have permitting on some things. It’s ongoing,” he said.

A state official who could speak about many of the permits potentially needed was not available for comment Wednesday.

In December 2015, Spackler estimated that detail engineering and permitting would take about 18 months. A year later, Caswell said that estimate is still on point.

Approval process

Regulatory approval starts with two components: safety and operational issues and economic development incentives from the state, Caswell said.

“South Dakota has really shown us that they want to attract new business,” he said.

And not just on a government level, he said, as AGP has “very close relationships” with South Dakota farmers as well.

“A lot of this has to do with soybean growers that took the decision to expand acres in South Dakota. They took the lead on that. We wouldn’t build the plant without the acres, so we owe a lot to the ag community and leaders who decided to expand that production,” Caswell said.

An estimated 14.26 million bushels of soybeans were produced in Brown County in 2015, with another 12.9 million grown in Spink County, according to the U.S. Department of Agriculture.

It’s “critically important” that the state and the Governor’s Office of Economic Development support both new and existing businesses, Scott Stern, office commissioner, said in an emailed statement.

“When there is a role for the state to play in providing an incentive to win a particular deal, we will work with the company and our local partners to do so,” he said.

He did not detail the incentives offered by the state.

Processing capacity

Initial plans were for the facility to process 35 million to 40 million bushels of soybeans annually. However, in July AGP approved design improvements for expanded capacity. Exactly how much more capacity there will be will depend on the quality of soybeans, Caswell said.

On May 9, the Aberdeen Board of Zoning Adjustment approved a permit for the storage of fuel oil, diesel fuel, natural gas, methanol, sodium methylate and hexane at 4816 Eighth Ave. N.E., the future site of AGP’s plant. The city has not had any further permitting requests from AGP, according to Ken Hubbart, city planner.

A property transfer for the land in Whitewood Industrial Park from the Aberdeen Development Corp. to AGP was filed in June, listing a land value of more than $3.1 million.

AGP officials have not released the plant’s full cost.

In July, the state Department of Environment and Natural Resources had not yet received paperwork or plans from AGP. At that time, department information specialist Kim Smith said permitting would depend on the size and scope of activities at the plant.

Now, AGP has applied for a permit with the department’s air quality program, Smith said. That permit — formally called a Prevention of Significant Deterioration Permit — might trigger other things the plant would need, he said. But the air quality permit needs to be approved first.

Kyrik Romboueh, a Department of Environment and Natural Resources engineering manager, said the air quality permit is required prior to construction.

AGP hopes to break ground in 2017 and have the plant operational in 2019.

A department document created in August 2015 said soybean extraction and processing plant permitting could also include:

• Water rights.

• Surface water quality, including storm water permits for both construction and industrial activities.

• On-site wastewater systems.

• Storage of some chemicals, including hexane.

• Waste, including separate permits for solid waste and hazardous waste.

• Storage tanks.

• Drinking water.

• Plans for wastewater systems and distribution might also need to be approved prior to construction.

Smith said that often, only one or two such permits are needed.

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