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Big Oil’s Raid on the Great Plains

Full disclosure: I am the attorney for one of the groups in opposition to the oil refinery proposed by Hyperion Resources in Union County, South Dakota.

Like Dr. Stockmann in Henrik Ibsen’s play, An Enemy of the People, Ed Cable, a construction consultant living in Union County, South Dakota, is trying to warn the residents of the county about the dangers of permitting an oil refinery to be constructed on the pristine farmlands in southeastern South Dakota.

In a modern day re-enactment of the Ibsen play, Cable leads a group opposing the projected oil refinery in Union County, which is about as far from an oil well as one can get.  His effort has been to sound an alarm to people about the major problems that will come with such a project, i.e., the pollution, the problems that will come with a massive influx of construction workers, and the lack of adequate hospitals and law enforcement to service such an influx.  He has found it as difficult as Dr. Stockmann to overcome the promise of money flowing into the area because of the refinery’s construction.

One must ask why is a Texas corporation moving as rapidly as it has to obtain approvals for a 400,000 barrel-a-day oil refinery to be located where there is no oil?

There is in fact a thimbleful of oil in extreme northwestern South Dakota, but not enough to keep a refinery busy.  There is no oil whatever in Union County, South Dakota, which is where Hyperion is attempting to move in to establish what it calls, “a green refinery.”  Putting aside for the moment the fact  that there is no such thing as a “green refinery,” why Hyperion wants to establish any kind of refinery in the lush farmlands of Southeastern South Dakota is a mystery. A mystery, that is, until one looks a little closer at the Texas corporation.

Hyperion is controlled by Texan Albert Huddleston, who, in 2004, contributed $100,000 to the Swift Boat Veterans for Truth, a Committee set up to smear Democratic Presidential Candidate John Kerry. He is also reported to be a close friend of George W. Bush.  The Corporation is planning to construct a $10 billion refinery on land where heretofore corn has been the principal commodity.

Huddleston is married to Mary Hunt, the granddaughter of fabled Texas oilman, H.L. Hunt.  He is also the Defendant in a lawsuit brought against him by a Miro Vranac, who is one of the Trustees of the “Lyda Hunt Bunker-Mary Moreland Hunt Trust.”  Vranac claims he was unjustly fired by Albert and Mary Huddleston after, so he alleges, he tried to block Huddleston’s attempt to use trust proceeds to pay off mortgages on real estate Mary Huddleston owned.  The lawsuit also alleges that Huddleston had requested a distribution of an additional $20 million from the Trust for what the lawsuit describes as “other misguided projects in Iraq and South Dakota.”

Beyond Huddleston, Hyperion’s background adds to the mystery of why anyone would plant an oil refinery where there is no oil.

One of the opponents of the refinery, Jason Quam, did some research on Hyperion as a company.  He found that the only real business Hyperion has been engaged in is building, buying and selling “sanitary landfills”—or in common parlance, garbage dumps.

What Huddleston and his Corporation have succeeded in doing so far is to talk the Union County Commission into granting a permit, one that would re-zone the entire area where the refinery would be located, giving Hyperion almost total control over the site, with little or no interference by the County.

His efforts have also succeeded in causing a corrosive division between those residents of the County who have agreed to sell their land to Hyperion at favorable prices, and those who have no desire to live next door to this pollution factory.  In a referendum in early June, Hyperion’s promises of lots of jobs and lots of tax money carried the election by 58 per cent.  Those who wanted to sell their land were joined by voters in the small town of Elk Point who fell prey to Hyperion’s promises, as well as those who live in Dakota Dunes, the bedroom community serving Sioux City, just across the border in Iowa, who are far enough away to be unaffected by the pollution, the destructive congestion, and the myriad of other problems that will be brought on by a $10 billion construction project.

During the buildup to the election, Hyperion was cunning  enough to resist answering publicly the questions opponents wanted answered.  It did so by holding public meetings, but instead of standing before the audience, the “experts” brought in by Hyperion sat at separate tables so their answers were heard only by those standing at a table, but not by the rest of the audience.  And the County Commissioners, who were virtually orgasmic at the thought of all that tax money coming in, refused to allow members of the public to ask questions during the few meetings they held with Hyperion present.  The Republican governor, Mike Rounds, has not only endorsed the project, but he has expended a great deal of effort to support it.  Again, full disclosure, this time on behalf of the Governor.   The Governor’s father was once a lobbyist for the oil industry in the South Dakota legislature.

This year, Hyperion officials quietly approached South Dakota’s U.S. Senator Tim Johnson to ask his help in obtaining a $10 billion guaranteed loan from the government to build the refinery.  Johnson broke the story to the press, but even that disclosure did not deter a yes vote from those who saw the dollar signs floating down to the County from Hyperion.  It’s apparent that Huddleston will have to get his financing somewhere else besides the government, especially if his friend George W. Bush is no longer holding sway in the White House.  Other experts have said that if the project were commercially viable, Hyperion would not need a government loan guarantee.

Beyond the money difficulties, there’s the question of where the oil will come from to feed the refinery.  Hyperion says it will tap Canadian tar sands from which crude oil will be extracted, then send it in a pipeline down to South Dakota.    Based on the cost of a pipeline now being planned by another oil company wanting to ship oil through South Dakota, such a pipeline from Canada to Union County will cost anywhere from $6 to $7 billion dollars.     Added to the cost of building the refinery, we’re talking real money here.

What South Dakotans are facing is the fact that there is no oil dirtier than that which comes from tar sands.  It is of such a low grade of crude that it has to be heavily refined.  And how long the nation of Canada will stand for the pollution and energy wastage resulting from producing oil from tar sands is a serious question.  This kind of extraction process produces three times more greenhouse gas emissions than does a barrel of conventional oil.  The only “green” thing remaining is that which will float southward to Texas into Albert Huddleston’s bank account, leaving South Dakota, a state which now has very clean air, to live with the pollution from his refinery.

Part of Hyperion’s campaign is to hold out the promise of cheaper gasoline prices if they bring the refinery online.  But America consumes 20.7 million barrels of crude oil a day.  Adding 400,000 barrels a day from a tar sands refinery will make no dent whatsoever in gas prices.  America is much better served by conservation along with such reforms as increasing wind and solar energy, constructing a nationwide rail transportation system much like those in Europe and Japan. We can hope that by the time any such farmland refinery would come online, this country would no longer be in need of more refineries.

Moreover, Barack Obama, who is likely to be our next president, has said that he is committed to breaking America’s addiction to “dirty, dwindling, and dangerously expensive” oil.   If Obama keeps his word and doesn’t find a new religion in the process of winning the election, oil refineries of any kind hopefully will become as outdated as horse-drawn carriages.

JAMES G. ABOUREZK is a lawyer practicing in South Dakota. He is a former United States senator and the author of two books, Advise and Dissent, and a co-author of Through Different Eyes. Abourezk  can be reached at georgepatton@alyajames.net.

 

 

 

 

 

 

 

 

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James Abourezk is a former US senator from South Dakota. He is the author of: Advise and Dissent: Memoirs of an ex-Senator.

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