Utah regulators approved plans this week to build the first commercial oil sands mine in the United States.

The decision gives Earth Energy Resources, a small Calgary-based energy firm, state approval to develop a 62-acre pit in eastern Utah. The company is still short $35 million for the project.

"We are working on (funding ) actively with a few parities and hope we're getting closer to putting a shovel into the ground," president Glenn Snarr told the Associated Press.

Permission was actually given a year ago, but green groups fought the proposal. Their concerns were overruled in a hearing this summer.

Residents of Grand County and environmental activists worry the oil sands project will deplete water supplies in America’s second most arid state. In Alberta, scientific analyses have concluded that producing and refining one barrel of oil sands crude requires two to four barrels of water.

Opponents also fear the project could hurt Utah’s billion-dollar tourism industry. With the oil sands operation projected to produce only 2,000 barrels per day, they wonder if the risks are worth it.

“The total amount of oil produced by this mine over seven years of operation would cover just seven hours of American oil demand — a tiny blip on the radar,” Living Rivers director John Weisheit said in a statement.”

Earth Energy Resources, meanwhile, claims to have pioneered a new extraction model which is much cleaner than traditional mines in Alberta.

“We use no harsh chemicals, do not contaminate the soil we work with, and create no tailing ponds,” reads the company's website. The firm boasts its method produces “clean saleable sand.”

Even with state approval, the struggle between proponents and activists may not be over. Appeals could end up in Utah’s Supreme Court.

Click here to read the Tyee's recent report about how oil sands operations are spreading from Alberta across the world.

Geoff Dembicki reports for the Tyee.