Crude by rail: Facility developments progress in Texas, North Dakota

Phillips 66 recently agreed to purchase a crude oil terminal near Beaumont, Texas, from UNOCAL. The transaction is expected to close in the third quarter pending regulatory approvals.

With the capacity to store 7.1 million barrels, the Beaumont facility will be the largest terminal in Phillips 66's portfolio, company officials said in a press release. The terminal features rail and truck loading/unloading facilities, two marine docks and one barge dock.

"Given our expectations for increasing volumes of North American crude oil movements into the Gulf Coast region and growth in refined product exports, the Beaumont Terminal is well positioned to serve this growing market while providing significant expansion potential," said Phillips 66 President Tim Taylor.

Meanwhile, Univar Inc. announced it broke ground on a new 52,000-square-foot facility in Elmendorf, Texas, in the Alamo Junction Rail Park that's currently under construction and is expected to be fully operational by year's end.

The facility will enable Univar to better serve customers at the north end of the Eagle Ford Shale, company officials said in a press release. The company will rely on the nearby rail park — to be served by BNSF Railway Co. and Union Pacific Railroad — to bring product into the facility, as well as blend or package and distribute materials.

In North Dakota, Meadowlark Midstream Co. L.L.C. has executed an agreement with Global Partners L.P. to construct a truck unloading station and a 47-mile pipeline serving Global's crude storage facility at Basin Transload's Stampede rail terminal in Burke County. Crude delivered to the rail terminal has single-line rail access to Global's Albany, N.Y., terminal and access to other rail-served terminals in the U.S.

To be completed by second-quarter 2015, the project is designed to attract incremental crude production that currently is trucked from sites in Divide County, N.D. After the pipeline is completed, customers will have direct access to the COLT Hub rail terminal and Stampede rail terminal, Global Partners officials said in a press release.

Also in North Dakota, Dakota Plains Holdings Inc. announced its frac sand transloading operations at the Pioneer Terminal in New Town will launch tomorrow through a new sand joint venture.

In August 2013, Dakota Plains and UNIMIN Corp. executed an agreement to construct a frac sand automated terminal with 8,000 tons of storage and annual throughput capacity of 750,000 tons. The terminal now is fully operational, Dakota Plains officials said in a press release.

"This new operation will make Pioneer a major supplier of frac sand in the Williston Basin and is expected to generate about $2 million in earnings per year," said Dakota Plains Chairman and Chief Executive Officer Craig McKenzie.

Dakota Plains’ sand joint venture has entered into an agreement with Genesee & Wyoming Inc. subsidiary Rail Link Inc. to operate and maintain the frac sand transload facility.

"We look forward to working with … Dakota Plains to expand operations based on increased frac sand demand, and further develop an inbound oilfield products business at the Pioneer Terminal," said Richard Grant, Rail Link's director of marketing.