PHOENIX (AP) -- A company planning to build an oil refinery in southwestern Arizona announced Monday it is changing sites again to avoid a pending legal challenge to a related land transfer.

Phoenix-based Arizona Clean Fuels said the latest site is 3 miles east of the previous site in eastern Yuma County. The company already had moved the $2.5 billion project to Yuma County from a site near Maricopa in northwestern Pinal County.

"It can now proceed as planned," Chief Executive Glenn McGinnis said in a statement.

Arizona Clean Fuels said the new 1,400-acre site is not part of a former federal parcel whose transfer to an irrigation district is being challenged in a pending lawsuit filed by the Quechan Tribe.

Company spokesman Ian Calkins said Arizona Clean Fuels believed its project would have survived the legal challenge to the land transfer but that the continuing court fight was a delay and a hindrance.

"That kind of uncertainty just was not working with our potential investors. You simply cannot hide the fact that there was a federal lawsuit," he said. "We've resolved the issue. The project now has certainty."

The Quechan Tribe's lawsuit contended that the federal Bureau of Reclamation failed to conduct required environmental and cultural surveys before transferring approximately 40,000 acres of land to the Welton-Mohawk Irrigation and Drainage District on March 26, 2007. The district then immediately sold 1,460 of the transferred acres to Arizona Clean Fuels the same day.

The company said the new site consists of private and state trust land and that it was working to transfer environmental permits to the new site. "We're of the belief we don't have to start from scratch," Calkins said.

However, Department of Environmental Quality spokesman Mark Shaffer later said the regulatory agency Arizona Clean New Fuels would need a new clean-air permit for the new site. That could take six months but use of the same design could help speed the process, he said.

A state Land Department official did not immediately return calls for comment on the possibility of using trust land.

Arizona Clean Fuel's current schedule calls for major construction to begin in the second quarter of 2009, with completion in 2012, Calkins said.

The project's most recent projected date for completion had been 2011, Calkins said. "It leaves us pretty much on schedule."

Frank Jozwiak, a Seattle attorney for the Quechan Tribe, said the litigation over the 40,000-acre land transfer would continue in U.S. District Court in Phoenix.

However, Jozwiak said he was unaware of the refinery project's site change and didn't immediately know what position the tribe would take on the new location.

"We would certainly have to look at it very carefully," he said. "Is this a pipe dream or a reality?"

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On the Net:

Arizona Clean Fuels: http://www.arizonacleanfuels.com/

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