The Arno Bay Progress Association has a plan to bring a fuel station back to Arno Bay.
Fuel has not been available from the town for many years, which Progress Association president David Frick said has had an "immeasurable" impact on the community.
Mr Frick said the lack of fuel was a deterrent to potential tourists, and was discouraging visitors from coming back.
"The amount of travellers coming through looking for fuel is incredible," he said.
"Tourism definitely is hurting from it."
Mr Frick said the need for locals to refuel in other areas impacted local business, and was "partly the reason" the town no longer has a supermarket.
He said many locals were going outside the Cleve district for their fuel and taking their spending money to Cowell, Whyalla or Port Lincoln, and the association had been looking at ways to rectify the situation for around three years.
In a deputation to the Cleve District Council this month, the association proposed the installation of a self-funded tank for diesel and petrol next to the Arno Bay Bowling Club.
Plans to turn the proposed location into a second bowling green never eventuated, and the land is now home to a new set of solar panels.
Mr Frick said setup costs would be around $185,000, but once installed the tank would fund itself.
A swipe card system would be put in place to avoid the need for staff and allow 24/7 access, which Mr Frick said would be useful to the whole district in emergency situations.
While he said the fuel would not be priced to make a significant profit, funds raised could go back into the community.
The association hopes to apply for a grant from the Foundation for Rural and Regional Renewal to assist in funding the project, and receive assistance from council in facilitating and funding the project.
At the council meeting, elected members were in agreement about the importance of the project in principle.
Council chief executive officer Peter Arnold will be preparing a report on the viability of the project for a future council meeting.
Mayor Phil Cameron said receiving approval for the project was likely to be a "very complex process" because of the use of community land.
Mr Arnold said the land was zoned for recreational use, which would complicate approval for a fuel depot.
Mr Frick said it was important discussions had begun with the council, and the association would be happy to see alternative solutions proposed.