Source: Food Day - The Oregonian - October 24, 2000

Similar to peanut butter, this is a special Oregon treat. It's an "old-fashioned" butter with no stabilizers; it can be kept at room temperature, but if kept refrigerated, very little oil separation will occur.

2 cups whole hazelnuts, toasted* (about 9 ounces)
3/4 teaspoon confectioners' sugar, or to taste
1/2 teaspoon salt, or to taste (optional)
1 to 2 tablespoons vegetable oil (for blender method)

Food processor method: Place the toasted hazelnuts in a food processor container fitted with the metal blade. Process to a coarse texture (like crunchy peanut butter), about 3 minutes. Gradually add the sugar and salt. Scrape down sides; continue to process until desired texture is achieved, about 4 to 7 minutes. Shelf life is about 3 months in the refrigerator.

Blender method: Place toasted hazelnuts and 1 tablespoon of vegetable oil in blender container and grind to meal on low speed. Continue to blend on low for several minutes, scraping down sides of container as required and adding another tablespoon of oil, if necessary.

When butter is fairly soft, blend on high for 2 to 3 minutes or until desired texture is achieved. Gradually add the sugar and salt; blend on low until thoroughly mixed.

* To toast hazelnuts, spread the shelled nuts in a shallow pan and roast at 275 degrees F for 20 to 30 minutes or until the skins crack. To remove skins, rub nuts while warm with a rough cloth.

Crunchy variation
Stir in 1/4 cup roasted, chopped hazelnuts or roasted (or raw) sunflower seeds to finished butter.

Makes about 1 cup butter.