Lawton officials say a pilot plant is a major reason for changes in the Westwin refinery project

A major change in the incentives agreement with Westwin Elements centers on the pilot plant that the entity says will be its first construction project.

The original agreement was signed in February, but the City Council, Comanche County Industrial Development Authority (CCIDA), Lawton Economic Development Authority and Lawton Economic Development Corporation (LEDC) all met Wednesday to sign off on new terms, to include immediately providing $3 million in “upfront” money to build a pilot plant.

That pilot plant — essentially, a scaled down model of the full-sized refinery — is important because it will provide the data for a bankable feasibility study, said the chairmen of Lawton’s three economic development entities. LEDC Chairman Barry Ezerski and other committee members who are bankers and developers said any bank that Westwin Elements approaches for a loan will want a feasibility study in hand before they will even consider the loan request.

“We needed a bankable feasibility study, and to do that, we need a pilot plant,” Ezerski said, adding the pilot plant will produce refined materials that can be sold, only on a smaller scale than the full-sized plant will.

CCIDA Chairman Paul Ellwanger, a retired banker, said Westwin Elements can’t do the bankable feasibility study until the pilot plant is done and in production, while LEDC President Brad Cooksey, who works to recruit industry, said the pilot plant is actually a better way to do the project, calling it part of the “baby steps in the process.

“This pilot plant reduces our risk,” Cooksey said, explaining that plant allows Westwin to make their product and prove the refinery works, before investing millions in a full-sized facility.

Cooksey also said the feasibility study will benefit more than bankers. It also will be important for obtaining government grants and attracting investors, he said.

CCIDA members said that part of the process also will involve input from federal agencies, such as the Department of Energy and the Department of Environmental Quality, who will have to analyze and sign off on the processes and what the plant and the equipment inside the plant will do. CCIDA member George Moses said the feasibility study is not an uncommon step.

“Banks are going to want to know for sure that it (the process) will work,” he said. “This is the only way they can do it.”

Jeannie Bowden, with Westwin Elements, said the feasibility study will be done by Wood Group USA, a consulting and engineering firm whose expertise includes mining. She said the end result will be an evaluation of the process, an independent analysis that will make the resulting feasibility study bankable. Westwin Elements will be able to get a loan for the remainder the plant project “when its proven.”

Last week, city officials said the estimated cost of the pilot plant project is about $10.6 million, to include $3.6 million in construction costs and $6 million in capital costs for equipment and machinery. Locals will be providing $3 million of the construction cost, as part of the amended incentives agreement that specifies $2 million will come from the money that CCIDA already has pledged to loan Westwin Elements and $1 million from the City of Lawton (to be taken from the $10 million it pledged). Westwin Elements is responsible for the remainder of the cost of the pilot plant, local officials say.

As part of the agreement, locals also will be releasing 40 acres of the 480-acre tract that CCIDA already has put into escrow for the refinery project. CCIDA will be transferring that land to the Lawton Economic Development Authority, the City of Lawton trust authority that the City Council has designated to be in charge of the Westwin project. LEDA, in turn, will lease those 40 acres to Westwin for $1 a year.

Under the agreement’s new terms, the plant is to be under construction by Oct. 1 and finished on or before March 1, 2024. And, the pilot plant project will call for an initial 85 employees: 40 in 2024 and another 45 by 2026.

City officials said they expect a three-year process to build the plant and get it operational, then complete the feasibility study.