A company that plans to convert switch grass into biofuels has received a state air quality permit to build a large cellulosic ethanol plant in southwest Kansas.

The Garden City Telegram reports Abengoa Bioenergy received the permit Friday for a $550 million plant in Hugoton that will produce more than 23 million gallons of fuel a year. Sixty-five people are expected to work at the plant, which is billed as the nation’s first commercial-scale cellulosic ethanol operation.

The company says construction is expected to take about two years and the facility will have an annual payroll of nearly $5 million.

The Spain-based bioenergy refinery company says the abundance of resources in the area makes Hugoton an ideal location for the plant.