Rangeland Energy begins to build crude-by-rail facilities in Delaware Basin

Rangeland Energy today announced it launched construction on the Rangeland Integrated Oil (RIO) System in the Delaware Basin region of southeast New Mexico and west Texas.

The system is designed to transport crude oil and condensate from the Delaware Basin — one of the fastest growing production areas in the Permian Basin — to multiple markets across the nation via outbound rail and pipeline. Construction of the system’s rail facility is under way. To be served by BNSF Railway Co., the facility will handle outbound crude oil and condensate, and inbound frac sand.

Known as the RIO Hub, the 300-acre rail terminal is located near Loving, N.M., in the center of the basin’s drilling and production activity, Rangeland officials said in a press release. The hub will provide storage, blending and rail loading services for outbound crude oil and condensate. Truck-to-rail transload operations are expected to begin in October with an initial daily capacity of 10,000 barrels. As demand increases, Rangeland plans to build high-speed unit-train loading facilities at the RIO Hub to increase daily capacity to more than 100,000 barrels.

"The services Rangeland will provide will further increase New Mexico's ability to develop its energy sources, grow our economy and continue to provide very well-paying jobs for New Mexico families," said New Mexico Gov. Susana Martinez.

The hub also will provide frac sand suppliers with unloading, storage and truck loading facilities for moving product into the basin by rail. Initial rail-to-truck transload service will accommodate more than 500,000 tons of frac sand per year, Rangeland officials said, adding that the company expects to expand infrastructure at the hub to accommodate more than 1 million tons of frac sand annually.

"We saw the power of creating optionality for customers when we developed the COLT System in the Bakken Shale," said Rangeland President and Chief Executive Officer Christopher Keene. "The market response was outstanding. The RIO System is similar and a direct result of our success in the Bakken."