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HomeMy WebLinkAbout6.h. Request by Flint Hills Resources for an Interim Use Permit for the Storage of Bulk Material (Sulfur) Outdoors, 09-16-IUPAGENDA ITEM: 09 -16 -IUP Request by Flint Hills Resources for an Interim Use Permit for the Storage of Bulk Material (Sulfur) Outdoors AGENDA SECTION: Consent PREPARED BY: Eric Zweber, Senior Planner AG ND NO. ATTACHMENTS: Resolution, Site Map, Site Plan, Narrative, Sulfur Storage Pit Cross Section, Stormwater System Map, Photos of Flint Hills Resources landscaping., Excerpt from the July 28 Planning Commission Minutes APPROV D BY: 0R.1 RECOMMENDED ACTION: Motion to Adopt a Resolution Approving an Interim Use Permit for Flint Hills Resources, L.P. to Store Bulk Material (Sulfur) Outdoors. 4 ROSEMOUNT CITY COUNCIL City Council Meeting Date: August 18, 2009 EXECUTIVE SUMMARY ISSUE Flint Hills Resources, LP (FHR) operates a petroleum refinery in north central Rosemount (and a small portion in southern Inver Grove Heights). Through the refining process, two non petroleum products are produced, coke (a form of coal) and sulfur. Traditionally, the sulfur has been stored as a liquid and shipped to market via liquid rail cars. Currently, FHR is looking for new markets and is proposing to solidify the sulfur in asphalt lined basins originally constructed for storm water storage. FHR is requesting an Interim Use Permit (IUP) to allow the outdoor storage of the solid sulfur. JULY 28 PLANNING COMMISSION MEETING AND PUBLIC HEARING During their July 28 meeting, the Planning Commission conducted a public hearing for the IUP. No residents spoke during the public hearing and Lowell Miller Stolte spoke on behalf of FHR. The Planning Commissioners asked how the requirement about keeping the sulfur on the site for only one year would be monitored. To address that issue, the fourth condition of the IUP was added to require FHR to submit an annual written report to the City indicating the progress of the sulfur storage. Planning Commissioner Demuth asked for clarification on how the modified storm water system would work. Assistant Engineer Dawley explained the revised storm water system and Ms. Demuth had no further questions. The Planning Commission recommended approval of the IUP with the four provided conditions. SUMMARY Flint Hills Resources (FHR) Zoning: Land Use Designation: Surrounding Land Uses: HI: Heavy Industrial GI: General Industrial North: Industrial East: Industrial South: Agricultural West: Agricultural HI Zoned Area (west of US 52): Primary Refinery Area: Sulfur Storage Area: Setback to Sulfur Basins: 1,150 Acres =500 Acres 'T- acres 993 feet FHR operates a petroleum refinery in Rosemount and through the refining process two non petroleum products are produced, coke and sulfur. Coke is a form of coal and is stored in large piles in the center of the facility and shipped to market via open rail cars. The outdoor storage of this coke would be defined as outdoor bulk material storage and processing within the City's zoning ordinance, but this practice has occurred since the refinery began operation around 1960, more than 10 years before the City incorporated and adopted its first zoning ordinance. Sulfur is a solid at the temperatures normally experienced in Minnesota, but is a liquid when it is removed from the petroleum at the temperatures associated with the refining process. All crude oil contains sulfur, but the Canadian crude oil that FHR typically refines has higher sulfur content than most other crudes. FHR produces about 1,000 tons of sulfur a day. Traditionally, sulfur has been stored in heated tanks on the site to maintain it in a liquid form. Sulfur is used by other industries for the manufacturing of plastics, sulfuric acid, rubber, gunpowder, and as a fertilizer additive. The recent economic downturn has caused the sulfur market to bottom out, resulting in FHR having to look for alternative markets for sulfur, including the possible land filling of the excess sulfur. Land filling, as well as some other alternative markets, requires the sulfur to be shipped in a solid form. FHR has developed a process in which they are proposing to take the liquid sulfur out of their tanks and deposit it into an asphalt lined basin that had been used for stormwater management, letting the sulfur solidify, then removing the sulfur and shipping it off site via trucks or rail cars. FHR has done a test pouring of this process and it appears to work with very little to no impact on air or water quality. The sulfur when poured has a slight smell of rotten eggs, but the smell did not leave the area of the pouring and did not leave the site of the refinery. Once the sulfur is solid it is very stable and does not react easily with rainwater. Any rainwater that falls within the basin is collected and treated within the FHR wastewater treatment plant on site. Sulfur can burn but it is not explosive, similar to wood. The concern with burning sulfur is that the water that would be used to put out the fire would produce sulfuric acid, but FHR's emergency management plan calls to collect the water that would be used in the basin and treat it in their on site treatment plant. The basin that is proposed to be used to solidify the sulfur is located in the west central portion of the site almost 1,000 feet from Rich Valley Boulevard. The basin is lined with asphalt to prevent infiltration into the ground and the basin can hold between 70,000 and 100,000 tons, which is approximately 70 days of peak sulfur production. Once the basin is full and the sulfur is solid, FHR plans on removing it from the basin and shipping it off site via trucks or rail cars. To allow a continual process of solidifying sulfur, FHR is proposing to construct a second asphalt line basin north of the first basin to allow one basin to be filled while the second basin is removing the solid sulfur. In this process, the only time that the sulfur is above the grade of the surround site would be when it is removed to be shipped. Stormwater The basin that FHR proposes to solidify and store sulfur is currently a stormwater retention basin for the West Tank Farm (a series of petroleum storage tanks) located north of the basin. For protection from leaks in the petroleum storage tanks, berms are constructed around the tanks that 2 are sized to hold the volume of liquid that is stored within the tanks After it rains, the stormwater within the berms is evaluated to determine if it is contaminated with petroleum or other substances. If it is determined to be clean, the gate valves are opened and the stormwater is allowed to run to the retention basin through a swale. If the water is determined to be contaminated, the water is trucked to the on site waste water treatment plant and treated. When the basin is used for solidifying and storing sulfur, the gate valves at the berms around the tanks would remain closed and a dam /barrier would be installed between the swale and the sulfur basin. The berms around the tanks can hold a volume of stormwater in excess of the 100 -year rain event. After the stormwater is determined that it is clean, the gate valves would be opened one at a time to allow the water to enter the swale. At the sulfur basin end of the swale a diesel- powered pump would be installed and the stormwater would be pumped to the south into the Southwest Stormwater /Firewater Basin. The dam /barrier would prevent the stormwater from entering the sulfur basin. The FHR proposed revisions to the stormwater management system will meet the City standards for stormwater management. Landscaping The sulfur basins are located west of the primary refining operation and approximately 1,000 feet from Rich Valley Boulevard. The basins are not visible because they are below grade. The only time that sulfur could be visible from the property line is when it is being removed from the basin and placed into trucks for shipment to market. To screen the refinery from Rich Valley Boulevard, FHR has installed a line of pine trees that have grown to approximately 40 feet in height. These pine trees provide the landscaping and screening required by the HI: Heavy Industrial zoning district. 11- 4 -16 -1 E. Interim Uses: Outdoor Bulk Material Storage and Processing Outdoor storage of bulk materials is an interim use within the HI: Heavy Industrial (11- 4 -16 -1) zoning district. Within the zoning district, there are seven conditions and standards that the outdoor storage of bulk material must meet. The following text describes the seven conditions and the staff findings on how the FHR proposal addresses these conditions and standards. 1. The bulk material is essential to the operation of the principal use of the site. The principal use of FHR is the refining of crude oil into petroleum products. All crude oil contains sulfur and the refining process produces sulfur as a by- product and therefore is essential to the operation of the principal use. 2. Processing of the bulk material is limited to changing the side of the material or changing the state of the material from liquid to solid. No blending or otherwise changing the chemical composition of the material is permitted to occur outdoors. The interim use requested by FHR is to convert liquid sulfur into solid sulfur and the storage of the solid sulfur until it is shipped to market. Staff has proposed a limit to the length of time that sulfur can be stored on site as a condition of approval. Staff proposes that once a batch of sulfur has been solidified that it must be removed from the facility within one (1) year. 3. The bulk material is nonputrescible. Sulfur is inorganic and thereby nonputrescible. 3 4. The leachate from the bulk material is contained, collected, and treated through a waste water treatment system in compliance with State, County, and local regulations. The rain water /stormwater that falls onto the sulfur would become leachate. The leachate will be collected in the sulfur basin and treated in the on site water treatment plant. 5. The area used for bulk material storage is no more than fifteen percent (15 of the land area used by the principal structures. The area in which the primary refining occurs is approximately 500 acres in size and the proposed sulfur storage basins would occupy approximately 7.5 acres, which is approximately 1.5% of the land area used by the principal structures. 6. The height of any stockpile of bulk material stored outdoors shall not exceed fifty (50) feet. All sulfur has been proposed to be stored within the depressed basins and therefore would have no height. 7. All outdoor bulk material storage shall be set back and screened as outlined below. In no case shall the outdoor storage of bulk material be located within 350 feet of any public right -of -way or prvperg line. a. If an outdoor storage area is located between 600 feet and 1,000 feet from a public right of way, it shall be screened from the eye level view from the public right of way by a seventy five percent (75 opacity screen to a height equal to the items being screened but not more than thiry five feet (35'). Screening shall be accomplished by buildings, structures, landscaping and berming, natural topography, screening wall, or a combination thereof Any screening wall shall be made of a masonry material and shall not extend more than 300 feet without a change in architecture to reduce its mass and appearance. The sulfur storage basins are located approximately 993 feet from Rich Valley Boulevard. Along Rich Valley Boulevard, FHR has installed a screen of pine trees that have grown to approximately 40 feet in height. While no screening would be required because all the sulfur is stored below grade, FHR's pine trees currently provide the 75% opacity screening that would be required if any sulfur were store above grade. Additionally, staff has proposed that the IUP expire on December 31, 2012 allowing FHR more than three (3) years to solidify the sulfur. If FHR still has a need or a market for solid sulfur after 2012, FHR would need to apply for a new IUP. Minnesota Pollution Control Agency and Dakota County Environmental Management Permitting FHR has submitted for a Solid Waste Permit from the Minnesota Pollution Control Agency (MnPCA) and has discussed the permit application requirements for a Special Waste Permit from Dakota County Environmental Management (DCEM) to allow FHR to solidify and store sulfur outdoors, as well as possibly land filling of the sulfur off site at permitted landfills if the solid sulfur is not marketable. The MnPCA has experience with this issue because the Ashland refinery in St. Paul Park has applied for a similar permit to solidify and store sulfur. The DCEM requires that FHR receive local approval before the County Board would consider approval of the Special Waste Permit. RECOMMENDATION Staff recommends that the City Council approve an Interim Use Permit for Flint Hills Resources to store sulfur outdoors. 4 CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 2009- A RESOLUTION APPROVING THE INTERIM USE PERMIT FOR FLINT HILLS RESOURCES, L.P. TO STORE BULK MATERIAL (SULFUR) OUTDOORS WHEREAS, the Community Development Department of the City of Rosemount received an application from Flint Hills Resources, L.P. requesting an Interim Use Permit (IUP) to store bulk material (sulfur) outdoors on their property located at 13775 Clark Road; and WHEREAS, on July 28, 2009, the Planning Commission of the City of Rosemount reviewed the Interim Use Permit application; and WHEREAS, the Planning Commission adopted a motion to recommend that the City Council approve the Interim Use Permit for Flint Hills Resources, L.P., subject to conditions; and WHEREAS, on August 18, 2009, the City Council of the City of Rosemount reviewed the Planning Commission's recommendation for the Interim Use Permit and agreed with the Planning Commission's findings. NOW, THEREFORE, BE IT RESOLVED, the City Council of the City of Rosemount hereby approves the Interim Use Permit for Flint Hills Resources, L.P. to store bulk material (sulfur) outdoors, subject to: 1. The Interim Use Permit shall expire December 31, 2012. 2. Compliance with all the conditions and standards of City Code Section 11- 4-16 -1 E Interim Uses: Outdoor Bulk Material Storage and Processing. 3. Each batch of solidified sulfur shall not be stored on the Flint Hills site for a period longer than one (1) year from the date that it has been solidified. 4. A written annual report shall be provided to City of Rosemount staff indicating the progress of the sulfur storage and may be provided through a copy of the MPCA report or some other manner as determined by city staff. ADOPTED this 18th day of August, 2009 by the City Council of the City of Rosemount. ATTEST: Amy Domeier, City Clerk William H. Droste, Mayor RESOLUTION 2009 Motion by: Second by: Voted in favor: Voted against: Member absent: 2 Flint Hills Resources Disclaimer: Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal document and should not be substituted for a title search, appraisal, survey, or for zoning verification. Map Scale 1 inch 0.5 mile I J.1 .N1 I i f t• i•,;1 1 :IWO" 6 M: Rat 1 PK* MX 11-$.1“ 1 Attachment for Flint Hills Resources Interim Use Permit Application for Sulfur Storage June 23, 2009 Proposed Project: Solidification and storage of sulfur in an existing asphalt lined stormwater basin referred to as the west tank farm basin (WTFB) and contingently in an additional future basin that would be installed adjacent to and north of the WTFB, only in the event of significant molten sulfur market disruption. Project Background: As previously discussed with the City, FHR solidified approximately 3,500 tons of sulfur in the west tank farm basin (WTFB) during the week of January 26, as was observed by City staff in April. Prior to initiating this effort, FHR had multiple meetings with the Minnesota Pollution Control Agency (MPCA) to review environmental considerations related to air, water, and waste for the project. No permitting was required based on this review and both the City and County were notified prior to initial pouring. FHR continues to maintain compliance with all environmental regulations associated with this project. FHR is evaluating options for moving this solid sulfur, with timing dependent on whether additional product will be solidified in the next few months (economy of scale considerations for both removal and shipping). Other than this one week in January, FHR has been able to ship all sulfur production in typical molten form via railcars and will continue to do so; however, FHR may see a potential loss of viable customer demand that requires solidification of sulfur. The IUP would provide flexibility in the ultimate disposition of sulfur stored in the basin in the future, if needed. The current plan is to install another basin directly north, and similar to the current one if the need arises. The purpose of a second basin is that, when one basin is being filled, the other could be emptied using an excavator with the sulfur then transported offsite likely via trucks. Currently, the basin is below ground and not visible from adjacent roads. Future plans are to utilize similar below grade storage for the second basin. Again, no sulfur will be visible from adjacent roadways, both due to below grade management as well as significant coniferous perimeter trees providing screening along Rich Valley. In addition to City approvals, a solid waste permit with a public notice will be obtained through the MPCA, as well as a Special Waste Storage Facility license from Dakota County. FHR is not pursuing any onsite disposal of sulfur with any of these actions; however, these state and county approvals are required in the event that decreasing market demands result in the need to ship the sulfur offsite as waste, rather than product. For further background on sulfur management, please see City staff presentations from May 26, 2009, Planning Commission Meeting as well as June 16, 2009, City Council Meeting. Compliance with Zoning Text: This proposal is intended to meet all conditions specifically identified in the recently approved changes to the Zoning text (11-4-16-1E) to add Outdoor Bulk Material Storage as an Interim Use within the HI- Heavy Industrial Zoning District. Specifically, under 11- 4- 16 -1E: 1. The bulk material is essential to the operation of the principal use of the site. Sulfur production /storage is an essential function of a petroleum refinery, given the need to meet existing fuel standards; 2. Processing of the bulk material is limited to changing the size of the material or changing the state of the material from liquid to solid. No blending or otherwise changing the chemical composition of the material is permitted to occur outdoors. Solidification in the basins is the only activity being proposed for alternative storage of sulfur; no blending, additives or further processing is being considered. Upon solidification, the sulfur will be excavated from the basin and shipped offsite. 3. The bulk material is nonputrescible. Sulfur in nonputrescible given that it is an inorganic material. 4. The leachate from the bulk material is contained, collected, and treated through a waste water treatment system in compliance with State, County, and local regulations. The storage will occur in an asphalt Tined inground basin that will capture all stormwater that contacts the sulfur. All water from the basin will be treated in the onsite wastewater treatment system which is governed by multiple local, state, and federal regulations and effluent limitations including a National Pollutant Discharge Elimination System (NPDES) discharge permit. 5. The area used for bulk material storage is no more than 15% of the land area used by the principal structure. Each basin is approximately 368' by 451' at the surface with a 4:1 slope to the bottom that is approximately 16' deep. The total area of the combined storage piles based on maximum storage to the surface will be —7.6 acres. The primary refinery structure occupies >500 acres. Therefore bulk material storage will utilize <2% of the principal structure area. 6. The height of any stockpile of bulk material stored outdoors shall not exceed fifty (50) feet. The height of the sulfur storage pile will always remain below grade level based on the below grade basin construction. 7. All outdoor bulk material storage shall be setback and screened as outlined below... Given that the basin would unlikely be completely filled prior to switching to the other basin, the active area of sulfur storage will be greater than 1000' from the nearest property line (Rich Valley Boulevard) for both potential storage sites. The southwestern corner of the existing West Tank Farm basin (nearest to property line) to be used for bulk material storage of sulfur is —993' from the property line while the similar point for the proposed basin will be —1027' from the property line. However, given the below grade nature of the storage facility with the proposed operation, no additional screening should be required. It should be noted that significant screening utilizing coniferous trees currently exists along Rich Valley Boulevard. r m b 2009 ey d 0ai Focter Dme: 3110200. 4:48.39 PM File: I1 Clie iintHill s\ Pne8e48Rem ediabm5ystems\ Prgecls \23190i642009\SlvmwalerRurot mxd User. bal F OA Gate Valve Flow Direction Conveyances /Structural Control Berm Waters of The State Drainage Areas Waters of the State Detention Basin Retention Basin Rafinnr, Ri lnnff Atria Feet 600 0 600 1,200 1,800 Meters 100 0 100 200 300 400 500 600 BAR R a Figure 2A STORMWATER RUNOFF Flint Hills Resouces, LP Pine Bend, Minnesota Art Flint Hills Resources from Rich Valley Boulevard Flint Hills Resources looking towards Gate 18 EXCERPT FROM MINUTES PLANNING COMMISSION REGULAR MEETING JULY 28, 2009 5.b. Request by Flint Hills Resources for an Interim Use Permit for the Storage of Bulk Material (Sulfur) Outdoors (09 16 IUP). Senior Planner Zweber reviewed the staff report. Flint Hills Resources, LP operates a petroleum refinery in north central Rosemount (and a small portion in southern Inver Grove Heights). Through the refining process, two non petroleum products are produced, coke (a form of coal) and sulfur. Traditionally, the sulfur has been stored as a liquid and shipped to market via liquid rail cars. Currently, Flint Hills is looking for new markets and is proposing to solidify the sulfur in asphalt lined basins originally constructed for storm water storage. Mr. Zweber stated that Flint Hills Resources is requesting an interim use permit to allow the outdoor storage of the solid sulfur and staff is recommending approval. Chairperson Ege asked how the one year time period is going to be regulated. Mr. Zweber stated that staff anticipates the applicant will provide written reports on how the material is being handled. Commissioner Messner asked if the requirement of no more than 15% of land area applies generally within the HI zoning district. Mr. Zweber replied that any business within the HI district wanting to have outdoor storage would be held to that standard. Commissioner Demuth asked for a better explanation of the stormwater process once the stormwater basins are used for sulfur storage. Project Engineer Dawley gave an explanation of how the stormwater will be handled on the site. Commissioner Irving expressed his concern of expecting the applicant to provide reports when they are not required to do so. Mr. Zweber stated that a condition can be added that reports should be provided but added that the City has a good relationship with Flint Hills and has continued contact with them. Commissioner Irving stated that since this request required an ordinance change and is a new situation, he would feel better if reporting was required and possibly have City staff be in contact with the other Minnesota agencies involved. Mr. Dawley stated that the applicant has already provided the City with a very inclusive stormwater prevention plan and that they are responsible for reporting to the other Minnesota agencies. Mr. Zweber added an explanation of how all of the required permits work together and what is required of the applicant. The applicant, Lowell Miller Stolte, approached the Commission and stated that Flint Hills could copy the City on the report they are required to file with the MPCA. The public hearing was opened at 7:05p.m. There were no public comments. MOTION by Schwartz to close the public hearing. Second by Messner. Ayes: 5. Nays: None. Motion approved. The public hearing was closed at 7:05p.m. Commissioner Messner stated he liked the idea of adding a requirement for the applicant to provided annually reporting. Chairperson Ege inquired as to what the reporting would entail. Mr. Zweber stated that it could be similar to mineral extraction reports staff receives containing what kind of material and how much is processed. He stated staff can give direction to Flint Hills as to what type of report is needed. MOTION by Schwartz to recommend the City Council approve an Interim Use Permit to Flint Hills Resources for the Storage of Bulk Material (Sulfur) Outdoors, subject to the following conditions: 1. The Interim Use Permit shall expire December 31, 2012. 2. Compliance with all the conditions and standards of City Code Section 11- 4 -16 -1 E. Interim Uses: Outdoor Bulk Material Storage and Processing. 3. Each batch of solidified sulfur shall not be stored on the Flint Hills site for a period longer than one (1) year from the date that it has been solidified. 4. A written annual report shall be provided to City of Rosemount staff indicating the progress of the sulfur storage and may be provided through a copy of the MPCA report or some other manner as determined by city staff. Second by Irving. Ayes: 5. Nays: None. Motion approved. As follow -up, Mr. Zweber stated this item will go before the City Council at their regular meeting on August 18, 2009.