Zenith Energy's fossil fuel storage and transport facility located along the Willamette River faces criticism for potential environmental dangers, particularly in the event of an earthquake. Credit: Photo by Jeremiah Hayden
Story updated Dec.18, 1:00 p.m.
Street Roots obtained Zenith Energy’s application for its Land Use Compatibility Statement, or LUCS, Dec. 18.
Zenith Energy needs the LUCS from the city of Portland to obtain an Air Contaminant Discharge Permit, or ACDP, from DEQ.
The application said the ACDP will facilitate Zenith’s transition toward renewable fuels by “phasing out all crude oil at the site by October 3, 2027.” Zenith operates its facility under a LUCS, issued Oct. 3, 2022, requiring it to transition to renewable fuels within five years.
The application said Zenith will also disassemble and remove 30 existing storage tanks on the site by Oct. 3, 2029. It said Zenith proposed no new development for handling fossil fuels in connection with this specific LUCS, except new valves and components to handle jet fuel and what it calls “sustainable aviation fuel,” or SAF.
“These near-term changes will eliminate crude oil activity (whether by rail, marine, or otherwise) on site and continue to move the facility toward renewable fuels while also further improving resiliency,” the application said.
Environmental advocates say it is essential to clarify what it means when Zenith promises its new infrastructure will be used for renewable fuels.
“This means that all of its existing infrastructure is freed up for an expansion of fossil fuels under the guise of transition,” Audrey Leonard, Columbia Riverkeeper staff attorney, told Street Roots Dec. 18. “Under this proposal, Zenith’s overall throughput of fossil fuels can still increase, even if new infrastructure is limited to ‘renewables.’”
Advocates have expressed concern over Zenith’s purported inability to maintain its prior promises and lack of public process, saying the city may attempt to rush the process before a new City Council takes action early next year. But in the final City Council meeting of the year, Mayor Ted Wheeler briefly consulted Michael Jordan, the City Administrator. He told Lynn Handlin, an Extinction Rebellion activist who testified on Zenith minutes before, that the next City Council would be responsible for the process.
“We do not have enough time to thoroughly engage this process between now and the end of the year, particularly with the holidays coming up,” Wheeler said. “So, it will be taken up by the next mayor and the next City Council in January.”
Zenith Energy submitted its new LUCS application to the city of Portland, Donnie Oliveira, deputy city administrator, confirmed to Street Roots Dec. 17. Details are sparse, but Michael Loch, DEQ public affairs specialist, also confirmed Zenith had submitted the application to the city.
Neither Oliveira, nor Elliott Kozuch, Community and Economic Development public information manager, would confirm what day Zenith submitted the application.
Street Roots reached Oliveira by phone Dec. 17 and asked him to send the LUCS application, but Oliveira said the city could not send it until Zenith pays the associated processing fees.
“It’s not real until they pay their invoice for the fees,” Oliveira said.
Oliveira added that the Portland Permitting and Development will not begin processing the application until after Zenith pays the fees.
Zenith’s quick turnaround adds anxiety to environmental advocates’ concerns that the city may attempt to rush the LUCS approval without a robust public process.
Local environmental advocates sent a letter to the city of Portland Dec. 16 demanding the city of Portland commit to a public process as it considers a new land use statement for Zenith Energy.
“We write to put you on notice that environmental and community groups will be watching closely to ensure that the City complies with state law and does not attempt another backroom deal with Zenith,” the letter said.
Co-signed by Linnton Neighborhood Association, Tank the Tanks, Northwest Environmental Defense Center, Breach Collective, Oregon Physicians for Social Responsibility and 350 PDX, the letter outlined many important legal implications if the city was to rush through a Land Use Compatibility Statement, or LUCS, without a robust public process.
“Importantly, advocates are watching to make sure that the community is not once again shut out of important decisions that impact the health and safety of Portland residents and the environment,” the letter said.
Advocates sent the letter to a handful of city officials who could potentially impact the decision, including Mayor Ted Wheeler; Mayor-elect Keith Wilson; MichaelJordan, city administrator; Donnie Oliveira deputy city administrator; Lauren King, deputy city attorney; incoming city councilors; and the Department of Environmental Quality, or DEQ.
Mary Stites, Northwest Environmental Defense Center staff attorney, cosigned the letter. She said Zenith has historically demonstrated a patent disregard for local and state laws.
“This pattern illustrates that the company does not fully appreciate the environmental and public health risks that its operations pose to residents of the region,” Stites said. “As such, the City should not reward their historic behavior by fast-tracking a LUCS without sufficient public involvement.”
The letter comes 10 days after Zenith suffered a significant setback in its efforts to continue transporting and storing fossil fuels at the Critical Energy Infrastructure, or CEI, Hub in North Portland’s Linnton neighborhood.
In a Dec. 6 letter, DEQ’s Office of Compliance and Enforcement told Zenith it needed to obtain a new LUCS from the city of Portland and provide it to DEQ by Feb. 4, 2025. Zenith will need the new LUCS to demonstrate the local statement aligns with air contaminant requirements after DEQ found Zenith illegally installed new piping on its own property and at least 250 meters of new piping and other components on an adjacent property.
DEQ simultaneously issued a $372,600 civil penalty to Zenith on Dec. 6 for construction and operation of the adjacent pipes. DEQ said Zenith used the new infrastructure from April. 8, 2021 to June 6, 2024. Despite knowing it was required to obtain DEQ approval for changes at the facility, Zenith failed to obtain the approval before construction and operation. In that timeframe, DEQ noted 34 unauthorized loading events at a neighboring dock owned by McCall Oil, which is not covered under Zenith’s current LUCS.
Zenith’s LUCS process is “quasi-judicial” in nature, meaning city code and state law call for public involvement, according to the letter. When Zenith appealed the city of Portland’s previous denial in 2021, the state Land Use Board of Appeals determined Zenith’s pursuit of that LUCS “must be viewed as a quasi-judicial decision.” While Oregon law may not explicitly require a public hearing for all quasi-judicial land use decisions, experts say the city has not provided sufficient reasoning for shutting the public out of the process, given the public’s interest in the matter.
Further, advocates argue prior private interactions between city officials and Zenith warrant a higher level of scrutiny during the current process. The letter said the city should not facilitate opportunities for Zenith to mislead regulators and the public.
“The City must consider any future land use decisions in a manner that is informed by Zenith’s history of evading public scrutiny, disregarding legal obligations imparted by local, state, and federal law, and lying to regulators,” the letter said.
Nancy Hiser, an organizer with Tank the Tanks and a Linnton neighborhood resident, said the communities near the CEI Hub deserve to be heard.
“For decades, we have advocated against our polluted air, against rail cars full of toxic and explosive fuels running past our homes, against the massive aging fuel storage tanks along our riverfront,” Hiser said. “Zenith Energy — in spite of their marketing campaigns — has repeatedly proven not to be a good neighbor, disregarding regulations and breaking promises. Zenith provides almost nothing to Oregon, exporting the vast majority of their products to foreign markets. It’s our lives and homes that are at risk.”
In a previously scheduled public meeting DEQ held on the evening of Dec. 16, multiple attendees asked how Zenith was able to continue its operations for three years at the McCall dock. Christine Svetkovich, DEQ northwest region administrator, said prior to a Nov. 13 inspection which unveiled the new construction, DEQ had not inspected Zenith’s facilities since 2022. At that time, DEQ was not looking for the information it ultimately found.
“My expectation is that we resolve any permit issues or incompleteness before we’re out on public notice, which is partially why we paused the permit process,” Svetkovich said. “We should have caught this, and we didn’t until recently. That’s why we are where we are today.”
Zenith’s history in Portland has been marred by repeated offenses, both in public and in private, according to local advocates. Despite failing to meet its promises to not increase fuel throughput, failing to pay required fees, failing to engage in required practice-runs for oil spills and violating its previous DEQ air permit, Portland city officials worked privately with the company to usher in a LUCS in October 2022, as first reported by Street Roots Aug. 23, 2023. The Oregon Supreme Court was actively hearing an appeal by Zenith at that time.
“Zenith’s repeated law breaking and dishonesty, in combination with the ever-increasing danger its operations pose to the public, call for decisive action from City officials to protect the public,” the letter said. “Not only should the City refuse to fast track new land use permissions for Zenith, the City should withdraw Zenith’s existing LUCSs and land use permissions.”
Advocates called for an open public process, saying previous meetings behind closed doors led to an outcome contrary to the public interest.
“This must be done to carefully consider Zenith’s operations as a whole with a deliberative, robust, and public process that Portland residents have been repeatedly denied,” the letter said.
Zenith currently operates under a Title V permit, and can continue to do so under an “application shield” administrative extension. Zenith applied for the ACDP to replace the Title V permit because it was a requirement of the 2022 LUCS issued by the City of Portland.
In pursuit of its LUCS in 2022, Zenith promised to transition to “renewable diesel” within five years of obtaining its permits. The Portland city auditor found Zenith violated city lobbying code in those communications with city officials, while excluding intervening parties in an active lawsuit from those communications. The ACDP will replace Title V if that permit is approved. DEQ paused the ACDP permit process Nov. 14 to gather more information, and Zenith continues to seek its LUCS from the city.
“Decision makers need to hear us,” Hiser said. “Why do we put up with this?”
Zenith Energy and the city of Portland did not respond to Street Roots’ requests for comment at the time of publishing.
Street Roots will update this story as details become available.
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