Shale Daily / NGI All News Access

Pacific Northwest Oil Rail Terminal Plan Approved

The Port of Vancouver, WA, Board of Commissioners on Tuesday approved a 10-year lease with a joint venture (JV) involving units of Tesoro Corp. and Savage Companies for a crude oil rail terminal at the port.

The action allows plans to move ahead for the largest crude oil rail terminal in the Pacific Northwest, a project the sponsors characterize as a 380,000 b/d facility. Tesoro has been a longtime tenant at the Columbia River port across the water from Portland, OR.

Tesoro-Savage partners are intending to bring North American crude oil to the port by rail where it will be transferred to marine vessels for transport to refineries in California, Washington state and Alaska.

The JV will lease 42 acres of port property to accommodate a rail unloading facility, storage tanks and a vessel loading area. Tesoro-Savage has said it will invest $100 million in the project, which bids to bring the port $45 million in revenues during the 10-year terms of the lease, and create hundreds of construction and permanent jobs.

Earlier this month following the derailment of an oil-laden train from North Dakota's Bakken Shale in eastern Canada (see Shale Daily, July 9), the three-member port commission appeared to reconsider the proposed terminal. A spokesperson for the board told NGI's Shale Daily in mid-July that the JV project had "yet to be decided," noting that postponement was still an option.

With the lease approval, the rail terminal project now moves into the environmental permitting process. Washington state's Energy Facility Site Evaluation Council will act as the lead agency for the environmental review.

A series of five workshops were held during a 10-week period on the proposed rail terminal, examining such issues as marine safety, rail safety, the permitting process, and an over view of the Tesoro-Savage plans. At the most recent hearing environmental representatives were urging the port board to delay its vote.

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