Cost of Dickinson refinery rising because of production delays blamed on cold, power system


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DICKINSON, North Dakota — The cost of a new oil refinery near Dickinson is rising due to delays in getting the facility up to full production.

The Dakota Prairie Refinery started accepting crude late last year and planned to begin production by year end, but bitter cold weather and electrical system revisions have pushed back full production until at least April, Bismarck-based MDU Resources Group said in a statement.

The plant is now expected to cost more than $400 million, about $50 million more than the previous estimate. MDU Resources Group and Indianapolis-based Calumet Specialty Products Partners, which jointly built the facility, are splitting the construction costs and returns.

"Although we are disappointed in the delay and cost increase at the refinery, we anticipate good returns from this facility," MDU Resources President and CEO David Goodin said.

Crews broke ground on the refinery in March 2013. Once it is fully operational, it will process 20,000 barrels of oil each day into 7,000 barrels of diesel fuel and other products. A barrel is 42 gallons. About 90 people will work at the plant full time.

"We also will benefit from experience gained with this project to help develop future projects, such as a second plant presently being evaluated near Minot," Goodin said.

The only refinery currently producing fuel in North Dakota is the Tesoro Corp. plant at Mandan. A $450 million refinery is in the works on the Fort Berthold Reservation, and a Canadian company is considering a $200 million plant at Devils Lake.

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