Update On Confusion About Proposed Davis Refinery West Of Belfield, North Dakota

In February of 2017, I wrote a blog post titled “Confusion About Proposed Davis Refinery West Of Belfield, North Dakota”.  I wrote this blog post, because I was so sick of the hype surrounding the Davis Refinery.  I was disgusted at North Dakotans, for not being able to tell the difference between fact and fiction, and being so easily duped.

In this February 2017 blog post, I looked up, and then explained who the Meridian Energy Group was, and who the Davis Family Partners were.  These two entities were founded in roughly 2012, and they had never constructed a refinery before.  I thought that this information would or should cause North Dakotans to slow down, wait a minute, and not get carried away.

I then explained, that the Dakota Prairie Refinery that was completed in 2015 near Dickinson, cost $430 million to construct, and was a joint venture between MDU Montana Dakota Utilities and Calumet Specialty Products.  I explained that the net worth of MDU was $5.28 billion.  After the Dakota Prairie Refinery was completed, it had quarterly losses of something like $7 million, and the refinery was sold to Tesoro.

I didn’t think that I had to break this down any further, but apparently I do:  MDU, which has a net worth of $5.28 billion, didn’t even attempt to build the $430 million refinery without a financial partner.  Then, with $7 million losses each quarter, MDU didn’t want to or couldn’t afford to own this refinery.

Meridian Energy Group originally stated that the Davis Refinery would cost $900 million to construct.  Given that the Meridian Energy Group and their largest investors the Davis Family Partners were created in about 2012, and had never built a refinery before, where was this $900 million supposed to come from?

I did see, and I did include in my February 2017 blog post about the Davis Refinery, a prospectus for investing in the Davis Refinery for the purpose of having money to start the project which read, “The proceeds from this Offering will provide Meridian with the working capital to acquire the necessary permits, secure project financing and perform all pre-construction activities to bring the project to “shovel ready” status.”

I didn’t think that I needed to break this down any further, but apparently I do, and this is very, very important:  The Meridian Energy Group was seeking investors in order to have enough money to cover permitting and pre-construction activities.

I do not want to be sued for libel, which can occur when written statements are made that are defamatory, untrue, and presented as statements of fact, so I want to emphasize that this is my personal opinion, not fact:  My opinion is that the Meridian Energy Group might only have $10 million to $40 million in investments and funding.

There have been delays preventing construction of the Davis Refinery, due to permitting, especially the air quality permit.  In order for there not to be further delays, the proposed capacity of the Davis Refinery was reduced, so that a “siting permit” would not be required, which would have involved public hearings.  By July of 2018, all of the permits were approved, and the Davis Refinery construction could begin.

Though construction on the Davis Refinery could begin in July of 2018, some environmental groups have joined together to file court cases in an attempt to stop construction, but there have been no cases that have been heard in court yet.

So has construction on the Davis Refinery begun?  All summer long in 2018, there were many articles about construction getting underway for the Davis Refinery.  From the enthusiastic hyperventilating newspaper articles and energy industry journals, you would have thought that there was going to be a tidal wave or tsunami of construction.

From what I have read, at the site of the Davis Refinery, some site grading has been done, and a site fence has been put up.  I drove to Belfield in July and August to look at houses for sale, and there was nothing going on in Belfield.  There was a fully furnished 3br/1ba manufactured home on its own 75’x140′ lot for $25,000 that no one bought and the price has now dropped to $20,000.  If there were many construction personnel working at the site of the Davis Refinery this Summer and Fall, housing in Belfield wouldn’t be so available and cheap.

I wish that the newspapers and energy industry trade journals would just stop it.  What are you trying to do?  And I wish that North Dakotans would do some reading, some research, and then drive to Belfield to go look at the refinery site.

Drive Directions To Site:  From I-94, exit onto Hwy 85 going south in Belfield.  Take Hwy 85 going south for approximately one mile until you get to 37th Street SW.  Head west on 37th Street SW for approximately 3-1/2 miles, on the north side of 37th Street SW, you will see where some ground has been worked and tilled, this is it.  There is no sign.

4 thoughts on “Update On Confusion About Proposed Davis Refinery West Of Belfield, North Dakota

  1. I’m a native ND resident and I’m not worried about the refinery, because it is clearly some sort of investment shell game and there never was or will be any intention of building a functioning facility. This whole deal never passed the smell test for me from day one.


    1. Rusty,

      It is very frustrating to me, that some newspaper reporters, journalists, and energy industry people are always gushing with enthusiasm when reporting about the Davis Refinery, talking about how many barrels of oil per day it will process, how many gallons per year of fuel it will produce, how many people will be employed during construction, how many people will be employed during operation, how good this will be for the area economy…….and they never stop to think or question, where are they going to get $900 million, their initial estimate, or even half this amount for a reduced capacity refinery.

      Something that I realized today, was that if the Davis Refinery was truly planned to be built, a series of at least 20 to 30 soil borings would have been done to a depth of at least 30 feet, to determine the suitability of the ground for construction, PRIOR to the land being purchased, because there would be no point in purchasing this 120 acre site if the land was not suitable. Also, this same series of soil borings or a new series of soil borings would be required in order for an engineering company to produce construction plans for this site, especially foundation plans. If at this late date, after the land has already been purchased, and an engineering company has been working on refinery construction plans for many months, and no civil engineering company has yet performed a series of soil borings and created boring logs, this would be an indication that no construction was actually planned to take place.


  2. I haven’t heard about your soil boring claim, but yes, they certainly would need to do them throughout the site to design the piling plan.


    1. Rusty,

      I am not claiming that they have not done a series of soil borings, but as much as Meridian likes to publicize each step of the process, such as land purchase, flying a balloon from the proposed site location, hiring an engineering company to make the refinery plans, hiring a local fence contractor, hiring a local earth work contractor, grading the site, hiring an engineering company in Bismarck, I have not ever heard about soil borings being done or what the soil borings indicated. (Legally, I can’t go making untrue statements, which can be proven to be untrue, like claiming that soil borings were not done, when in fact they were done and they just never reported it. The fact that they never mentioned it, makes me believe that they might not have been done.)

      If soil borings haven’t been done yet, this would be significant, and it would be hard to find a civil engineering company that would agree to create soil boring logs and claim that soil borings were performed much earlier. Because of the possible future significance of when the soil borings were actually performed, there would need to be an invoice to Meridian from a company that owned a boring rig, and a record from a bank showing a deposited check from Meridian payable to the company owning a boring rig, and the date would be clear on the deposited check.


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