Gevo Bails on Lake Preston, Says South Dakota Bad for Business

At least Gevo keeps its promises.

Two years ago, the biofuel maker said it would abandon its plan to build a massive jet fuel plant in Lake Preston if South Dakota didn’t approve the Summit Carbon Solutions carbon dioxide pipeline. South Dakota not only didn’t approve the pipeline but banned the use of eminent domain to build CO2 projects, and now Gevo is moving its jet-fuel aspirations to Richardton, North Dakota:

Colorado-based Gevo had obtained a $1.46 billion loan through the U.S. Department of Energy to build a jet fuel plant at Lake Preston, South Dakota. Company officials told the North Dakota Monitor on Thursday that it instead will push ahead with making jet fuel at the Richardton, North Dakota, ethanol plant it bought last year. Gevo is working with the Department of Energy to transfer the loan to expand the North Dakota site.

Red Trail Energy at Richardton in 2022 became the first ethanol plant in the country to capture and store carbon dioxide, taking advantage of its location in an area with the right geology for permanent underground storage.

Gevo plans to expand the North Dakota ethanol plant, which turns corn into fuel. It would convert the ethanol into higher-value aviation fuel in a process it calls alcohol to jet. Carbon capture is a key part of making sustainable aviation fuel.

“We don’t have to share pipelines. We don’t have to wait. We’re already doing it,” CEO Pat Gruber said of carbon capture at the North Dakota site.

…Gruber said building in North Dakota also opens the door to Gevo selling its carbon to the oil industry. North Dakota oil producers could buy the carbon dioxide for enhanced oil recovery — pumping gas into the well to help the well produce more oil.

“This is a great opportunity for us, and we sit right next to Bakken,” Gruber said, referring to the Bakken Formation. North Dakota is the nation’s No. 3 oil producing state, with most of it coming from the Bakken.

[Jeff Beach, “Sustainable Jet Fuel Developer Plans Move to North Dakota amid Summit Pipeline Delays,” North Dakota Monitor, 2025.10.16].

Gevo is hanging onto its Lake Preston site, but CEO Gruber has soured on doing business in South Dakota:

“South Dakota is a very difficult place to do business,” Gruber told South Dakota Searchlight on Friday. “Everything is oppositional. North Dakota is a breath of fresh air.”

…In 2022, he said, there was strong support in state leadership for both the pipeline and Gevo’s Net Zero-1 complex in Kingsbury County.

Then the political winds shifted.

“Having lived through the change, I’m not doing that again,” Gruber said [John Hult, “Jet Fuel Company’s Leader Calls South Dakota ‘A Difficult Place to Do Business’,” South Dakota Searchlight, 2025.101.17].

Gruber says South Dakota’s oppositionality is costing the state money and jobs:

“I feel bad for the farmers. I feel bad for the economy of South Dakota,” Gruber said.

The company estimated to GOED that it would pay $900,000 in annual property taxes on the South Dakota plant. It also estimated it would create 90 full-time equivalent jobs.

Gruber said Monday it would also have resulted in an annual economic impact of about $100 million.

Instead the state has rejected the benefits, Gruber said.

“It’s anti-development, as if they want to go backward in time,” Gruber said of South Dakota.

In comparison, North Dakota “has a great business environment. It wants to grow industry and agriculture,” Gruber said [Rae Yost, “GEVO CEO: ‘Not 1 Dime’ Taken in State Money,” KELO-TV, 2025.10.20].

Kristi Noem threw in hard for Gevo, promising big tax breaks to entice their development in Lake Preston. But yet another opportunity for Noem to leave a lasting legacy, a business that creates wealth, has evaporated. Noem could have avoided this outcome by working harder to quash the rebellion within her party that led to the unseating of many mainstream business-über-alles Republicans in the 2024 primary. But she was distracted by her constant audition for a job in Trumpland, which allowed the mugwumps in her party to surge and weaken the party’s focus on the crony capitalism that kept the state’s economic development on life support and helped entrench the SDGOP’s political dominance. With less focus on herself and more focus on her party, Noem could have kept the whackadoodles on the sidelines and kept Gevo on track to bring jobs and jet fuel to Lake Preston. But thanks in part to Noem’s neglect of state politics, Gevo is acting in its self-interest and moving to North Dakota.