Oregon regulators have canceled public hearings for a controversial fuel terminal in Portland.

Oregon Department of Environmental Quality staff say they conducted an unannounced inspection at Zenith Energy’s terminal on Wednesday. Inspectors concluded they needed more information from Zenith before considering its application for an air quality permit, which would have allowed it to continue storing and moving fuels between railcars, ships and pipelines.

DEQ subsequently canceled its two public hearings scheduled for November and December.

During the inspection, DEQ staff say it appeared Zenith had done construction work that was “more expansive” than they expected.

In 2020, Zenith installed a valve and welded pipe so it could start handling diesel and renewable diesel at another dock, called the McCall Dock. The company didn’t notify the state for three years. DEQ issued a warning letter in March 2024. This week was the first time DEQ staff were able to see the dock modifications for themselves.

“We’re very understaffed, and we have a lot going on,” said Lisa Ball, air quality manager in DEQ’s Northwest Region “So, we had not been out there to examine the construction that was on site.”

Ball said the inspector is completing a report of what they saw at Zenith’s terminal, which will be published on DEQ’s website when it’s complete.

The Houston-based company has been operating a fuel terminal in a Northwest Portland industrial area since 2018. It has since drawn intense opposition from many local environmental groups and Portlanders, who have criticized Zenith for violating multiple local regulations.

Ball credited people who have publicly raised their concerns about Zenith for Wednesday’s decision.

“I really thank the community for their continued engagement and support in this permitting process. You know, it was their questions and comments that led us to further investigate,” Ball said. “I just really hope that they can see that the information that they provided to us was helpful and it really led us to take action.”

DEQ staff say they will schedule another public information meeting by early December, where they will share more information about the inspection and next steps.