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By Mikkel Pates, Forum News Service, Published April 11 2013

Spiritwood’s future in energy production moving forward

SPIRITWOOD, N.D. – Transportation, power and water are the main reasons Spiritwood has been chosen for two major agriculture-related manufacturing installations, officials say.

Spiritwood has long been a visible focal point for the region’s agriculture: The Cargill Malt plant has loomed and grown north of Interstate 94 since the 1970s. Now it will be a mega-hub, with ethanol and fertilizer production coming in the next three years.

“Location, location, location – they all come together there,” says Rich Garman, senior project manager for Great River Energy, which has interests in electrical generation and ethanol projects at the site.

The village of 72 people is just five miles east of Jamestown in eastern Stutsman County, and will have more than 400 people coming to work when all of the development is complete, probably by the end of 2016.

Connie Ova, CEO of the Jamestown/Stutsman De-velopment Corp., which is helping to direct projects in the Spiritwood Energy Park, says the potential is tremendous.

“The economic impact to the area is enormous,” Ova says. She says the jobs are important, as is the value-added impact on the agricultural community.

Construction on Dakota Spirit AgEnergy LLC is expected to start this summer and continue for 18 months. Dakota Spirit will use 23 million bushels of corn to produce 65 million gallons of ethanol each year. It will create 35 full-time jobs.

Construction on a $1.4 billion CHS Inc. fertilizer plant is expected to start in 2014, just as the ethanol project is completed.

The CHS fertilizer plant is a much larger project than the ethanol plant. When it’s completed in late 2016, CHS will provide 150 full-time jobs. It will take natural gas and produce 2,200 tons per day of various kinds of ammonia, which will make several products including anhydrous ammonia and urea.

Both projects will use tremendous amounts of water. Dakota Spirit will use 450 gallons of water per minute, getting most of it from the city of Jamestown wastewater treatment plant, Garman says. The bulk of it will be for a cooling tower.

If the CHS project comes on board as expected, it will need 5,000 gallons of water per minute. Developers have identified and intend to explore the Dakota Aquifer – a water source 1,000 feet underground that will need processing. It is separate from the Spiritwood Aquifer that is about 200 to 300 feet underground.

The two projects together could use 20 megawatts of power, and it isn’t clear who will supply that.

Garman says the whole project fits into the framework of the Spiritwood Energy Park Association, a joint association between Great River Energy and the Jamestown/Stutsman De-velopment Corp.

The entities jointly purchased 551 acres of land, just west of an electrical energy generation plant and the Cargill malt plant, specifically to develop industry across the road that would use energy coming out of the power plant.

The JSDC will develop roads and rail service and is financing about half of the energy park project. It expects a 5 percent annual return on its money. About $1.8 million will come from a North Dakota Transportation Department revolving rail loan fund, which has been in place since the 1970s for small rail projects in the state.

Northern Plains Electric Cooperative is sponsoring a loan guarantee of $740,000, on a 0 percent interest U.S. Department of Agriculture Rural Economic Development-guaranteed loan program.

Still short as much as $1.75 million, the project will seek funds from local lenders. First Community Credit Union in Jamestown has shown interest in the program, Garman says.

An initial rail design circling the development has been approved by BNSF Railway. It will provide access to trains coming from east or west.

For the ethanol plant, corn will come in primarily by truck and ethanol will go out primarily by rail.

The park will be managed by the Spiritwood Energy Park Association, which will function as a landlord, and like a cooperative.

There are nearly three miles of roads from I-94 to the facilities, Garman says. An existing blacktop will be upgraded with a new asphalt overlay and other roads will be made concrete – built by the county and then specialty-assessed taxes will be paid by GRE and the energy park. The energy park will pass its specialty tax assessments on to tenants.

There are concerns about housing and the workforce, Ova acknowledges. A 90-room Hampton Inn hotel will open this spring. “That will take a little of the pressure off,” she says.

The development corporation is reaching out to developers, encouraging them to look into the opportunities. Some of the housing needs are temporary, she says.

“We’re also feeling a pinch with the rest of the sectors, of a lack of employees,” she says. “It goes back to the fact that we have no place for them to live.”