ST. PAUL  — The Minnesota Department of Natural Resources said Friday that it sees “virtually no scenario” in which it would approve a permit for a company proposing to transfer groundwater from Minnesota to the Southwest.

Empire Builder Investments has proposed drilling two wells in Dakota County that would produce 500 million gallons of water annually to ship to western states by railcar. The proposal is drawing objections from county leaders and environmental advocates.

Water “is like our mother lode of assets,” said Steve Morse, executive director of the Minnesota Environmental Partnership, a coalition of environmental groups. “To basically mine that out and ship it away is really offensive.”

The DNR said the company hasn’t submitted a water appropriation permit application, but has requested a preliminary well assessment, which is an early review designed to identify potential issues before a proposer invests in equipment or well drilling.

In a statement, DNR Commissioner Sarah Strommen said the agency must manage public water resources for the benefit of the state and future generations, and after an initial review, “we are notifying the company today that we see virtually no scenario where the DNR would grant a water appropriation permit for the project.”

Empire Builder Investments is the real estate arm of Progressive Rail. A message left at the office Friday wasn’t immediately returned to The Associated Press.

The Star Tribune reports the company wants to drill two wells on a 6.2-acre parcel in Randolph, within a mile of Lake Byllesby in the Cannon River watershed. The wells would pump up to 6,000 gallons of water per minute, doubling the amount of water currently taken from area wells annually.

County officials said the water would be shipped by rail to communities near the Colorado River. The application says the water would be used for commercial and institutional purposes, but Dakota County Commissioner Mike Slavik said he heard it was intended for agricultural use in southwestern Colorado, where drought conditions have persisted for years.

Jason Moeckel, a manager with the DNR’s division of ecological and water resources, said the proposal has challenges. One Minnesota statute prohibits issuing new permits for wells drawing water from the Mount Simon-Hinckley aquifer unless the water is for potable use and there are no “feasible or practical alternatives.”

The Mount Simon aquifer in the metro area extends nearly to Duluth and encompasses all of southeastern Minnesota. It sits 1,000 feet below ground and contains uncontaminated water that’s at least 10,000 years old, Moeckel said. Another Minnesota law lists specific criteria for diverting water outside Minnesota.

Slavik said the county works hard to take care of its water, so it doesn’t make sense to “give it away like this.”

“There’s going to be a point where our water’s more valuable than oil,” he said.