BISMARCK, N.D. (AP) — MDU Resources Group Inc. announced Thursday that it will build a diesel refinery in western North Dakota to help feed an unprecedented need for the fuel in the state's booming oil patch.
The Bismarck-based energy, mining and construction company will partner with Indianapolis-based Calumet Refining LLC to build and operate the plant west of Dickinson, said David Goodin, president and chief executive officer of MDU Resources.
The joint venture, called Dakota Prairie Refining LLC, would operate the so-called diesel topping facility, or sort of a mini-refinery. A major refinery has not been built in the United States since the mid-1970s.
Goodin said the refinery could cost up to $300 million. It would operate nonstop, processing about 20,000 barrels of crude daily from the rich Bakken and Three Forks formations in western North Dakota.
Construction is slated to begin this spring, with completion set for late 2014, Goodin said. The factory would employ about 100 workers, he said.
North Dakota has only one oil refinery, Tesoro Corp.'s facility in Mandan.
Gov. Jack Dalrymple said developing another refinery has been a long-time goal of the state.
The project, located within the state's oil patch, has a "great location and is a great opportunity for everybody in the state," Dalrymple said.
North Dakota imports about half of its diesel fuel at present, Goodin said.
State Tax Department records show that diesel fuel consumption in North Dakota has increased more than 51 percent since 2007, and the oil industry replaced agriculture a few years ago as the biggest user of diesel in the state.