SARATOGA -- A massive coal-to-liquids plant planned for Carbon County cleared a major hurdle last week.

DKRW Advanced Fuels’ Medicine Bow Fuel and Power project was granted an industrial siting permit after an all-day hearing here.

The permit from the state Industrial Siting Council was granted after the company announced two major modifications in the project.

The timeline for the start of the $2 billion project located between Medicine Bow and Elk Mountain has been pushed back one year, and the finished product of the coal-to-liquids plant has been switched from diesel to gasoline.

The start date of the project, originally projected for the spring of 2008, “has slipped to the second quarter of 2009 due to weather concerns,” said Jude Rolfes, senior vice president of engineering, construction and asset management for DKRW Advanced Fuels. The final permitting is also expected to be delayed until winter of 2008.

Site work for the plant is now planned to begin in the second quarter of 2008 by a local contractor, Rolfes said.

As for the change in the finished product from diesel to “low-sulfur gasoline," Rolfes said, “The diesel plant was not ready and the gasoline plant was."

Asked by council member Sandy Shuptrine about the market for low-sulfur gasoline, Rolfes responded, “Yes, there is a market. It can be used in your car (as produced) or it can be blended with other gasolines."

The board was also concerned with carbon dioxide emissions from the process of turning coal into liquid fuels.

“We plan to send the CO2 to northeast Wyoming for use in the enhanced oil recovery projects that are already occurring there,” Rolfes said. “There is a strong market for it.”

Under questioning from the board and Department of Environmental Quality Industrial Siting Division spokesman Tom Schroeder, the applicant agreed to provide housing at the plant site for up to 500 workers during the construction period. The site will have the capacity to expand to accommodate up to 1,000 people if needed, and the company will continue to work with the surrounding communities to find housing for the construction work force that is expected to peak at 2,300.

In addition to the company and the state DEQ Industrial Siting Division, nine other parties registered to participate in Thursday’s hearing.

According to Kate Perez, director of communications and public relations for DKRW, “This permit was a big one, but there are several more to get. The next big one is the air quality permit from the Wyoming DEQ, which we expect to get early next year.”