A proposed Port of Stockton wood pellet warehouse faces mounting opposition from local organizations over potential health risks and environmental harm.
Overview of the Project
The Stockton port terminal would be one of three facilities in a multimillion-dollar project developed by Golden State Natural Resources (GSNR), a public charity seeking to reduce the threat of rural wildfires by producing wood pellets from excess biomass.
GSNR would build two pellet-processing plants, one each in Lassen and Tuolumne counties. Those plants would use wood from Stanislaus National Forest, Yosemite National Park and other public forests within a 100-mile radius of each.
Finished pellets would be shipped by rail to a Stockton port twin-dome distribution center, where deep-draft cargo ships would load them up and carry them off to Europe and Asia. GSNR envisions the pellets would replace fossil fuels such as coal to generate renewable energy overseas.
Supervisors from Humboldt, Inyo, Modoc, Butte, and Siskiyou counties comprise the five-member GSNR board. The remaining GSNR staff comprises current and former Rural County Representatives of California and Golden State Financial Authority members.
GSNR estimates the project will generate approximately $298 million annually in revenue once constructed and fully operational.
The Stockton, Lassen and Tuolumne facilities will cost approximately $525 million, GSNR says.
The Stockton port facility will encompass 27.93 acres on Rough and Ready Island and take 18 months to complete, according to GSNR.
GSNR is working with United Kingdom biofuel energy company Drax to assist in the development and management of the proposed wood pellet project, signing a Memorandum of Understanding on Jan. 18, 2024.
Local Impact of Stockton Facility
Upon completion, the Stockton facility would generate eight full-time jobs, $148,000 annually in taxes and have a $29.2 million economic impact, proponents say. The Port of Stockton would process an estimated 1 million tons of wood pellets per year once both pellet-producing facilities are complete and operating at maximum capacity.
Traffic in and around the port would increase as GSNR estimates it would need 25 to 30 vessels annually as well as a trainload of wood pellets every four to five days to transport the 1 million tons of wood pellets.
Wood pellets have passed through the port before. In November 2020 the port received a 2,000-metric-ton shipment of wood pellets destined for Japan.
The Port of Stockton was one of two ports GSNR examined to establish wood pellet storage facilities for international markets. Stockton was ultimately selected over the Port of Richmond after residents and environmental groups there garnered over 100 signatures opposing the proposed project.
GSNR’s CEO and president, Patrick Blacklock, said Port of Richmond officials got cold feet after potential litigation from local environmentalist groups. “They kindly asked us not to proceed because they were in litigation and didn’t want more,” he said.
Project Resistance in Stockton
Similarly, Little Manila Rising, The Delta-Sierra Group of the Mother Lode Chapter, Valley Improvement Projects, Catholic Charities Diocese of Stockton and the NRDC (Natural Resources Defense Council) issued a joint press release on July 29 pushing back against the Stockton port facility proposal.
The local coalition criticized the GSNR project as being “half-baked.”
The pellet warehouse operation would expose Stockton to fire and explosion risk from wood dust, it said. The wood pellet industry degrades forests and hinders sustainable economic development where they operate, it said.
“The storage and export terminal would be the latest environmental injustice to come to the area, sacrificing Stockton’s safety and health for GSNR’s profit in overseas energy markets,” the coalition wrote.
According to the Environmental Protection Agency (EPA) San Joaquin County has some of the worst air quality in the nation in both smog and particle pollution due to the surrounding mountain ranges trapping emissions.
Blacklock said this issue will be addressed in the air quality chapter of an upcoming Environmental Impact Report (EIR).
GSNR intends to release an EIR sometime later this year or early 2025 for public review. The EIR has been delayed on multiple occasions and was originally set for release sometime late 2023, early 2024 and summer 2024.
During its Sept. 9 board meeting GSNR indicated it is nearly done with a draft environmental report for internal review.
Funding The Facilities and Pre-Development
To finance the project, GSNR is seeking private investment for development and has reached out to Barclays Bank for a possible $400 million loan. Drax has also indicated interest in investing in the project; however, Drax is waiting for the EIR before continuing, according to Feb. 28, 2024, GSNR meeting notes.
International wood pellet sales revenue would be used to pay back investors and fund future opportunities, GSNR said in a March 30, 2022, board meeting.
GSNR originally took out a $10 million loan from its own affiliate organization known as Golden State Finance Authority (GSFA) in 2022 and an additional $1.75 million loan in 2023.
GSFA is a public entity that focuses on providing affordable housing as well as contributing to the social and economic well-being of California residents.
As of the time of reporting, GSNR has spent over $10.5 million, including nearly $1 million interest accrued on its original loan and acquiring land for the Lassen and Tuolumne County wood pellet facilities, which cost just over $2 million combined.
According to the GSNR board meeting, the organization has approximately $300,000 in cash of the original loan available to spend. During its May 15, 2024, meeting, one GSNR member said jokingly after a finance update, “We are broke but at least we know where it’s at.”
When asked if GSNR is under threat of running out of money, Blacklock said the organization has enough money to see the proposal through.
“There’s $300,000 left from the original loan, then little over a million ($1 million) left from the same Golden State Finance Agency,” Blacklock said. “The public agency (GSFA) provided the initial loan to get through the EIR and we still have the funds to do that. There’s still sufficient funds available to complete the environmental review and entitlement process.”
GSNR has yet to acquire the land for the Stockton port facility but is in negotiations with the California Building and Construction Trades Council and the Northern California Carpenters Regional Council to construct the facility.
According to the Aug. 30, 2023, GSNR board meeting minutes, the non-profit has reached out to State Sen. Susan Talamantes Eggman, D-Stockton, and Assembly Member Carlos Villapudua, D-Stockton.
Blacklock says GSNR has yet to have any direct state participation in the proposal, including Villapudua.
“We got one federal grant and that’s the extent of any outside government investment. We haven’t asked the assembly member for anything and wouldn’t have been a formal partner in any way,” Blacklock said.