Oil-to-rail project planned near Douglas

2013-04-04T22:30:00Z Oil-to-rail project planned near DouglasBy ADAM VOGE Casper Star-Tribune The Billings Gazette
April 04, 2013 10:30 pm  • 

DOUGLAS, Wyo. — A Houston company is seeking permission to build a crude-oil rail-loading facility near Douglas, joining a growing group of new Wyoming facilities shipping oil by train.

A representative of Genesis Oil told Converse County commissioners Wednesday that his company has applied to the Wyoming Department of Environmental Quality for permission to build a crude-oil rail-loading facility near Douglas.

The company, doing business in Wyoming as subsidiary Pronghorn Rail Services, has yet to receive permission for the rail facility. Genesis representative Dwayne Morley said the potential rail facility is “just an idea at this point” and could offer few details about the company’s plans for the site.

In the meantime, the company will build truck-to-pipe loading infrastructure at the same location, located on Country Road 55 about 15 miles north of Douglas.

Trucks should be able to offload in the facility by late summer or early fall. Morley said it’s not clear just how much oil could be loaded into Genesis’ pipelines at the facility, but estimated at least 10 trucks -- each of which can hold between 150 and 200 barrels of oil -- would make daily visits. Product would then be piped either to Evansville’s Sinclair Refinery or the small Antelope Refining Co. just north of Douglas.

If all goes well, the loading facility could eventually handle two or three times that truck traffic, roughly equivalent to 5,000 barrels of oil each day. Oil shipped via the pipeline is likely to come from all over Converse County, which lately has seen dramatic increases in oil well drilling and production.

The rail proposal is the fourth such Wyoming undertaking this year. Two other developers are looking to build rail-loading facilities for oil in Guernsey and Casper, and a third, Enserco Midstream LLC, announced plans to build a facility in Douglas in March. All three projects could be operational this year.

The announcements also signal a larger trend toward moving crude oil by rail. Oil producers and oil transportation companies in North Dakota’s booming Bakken shale oil play have used rail in place of unavailable pipelines in emerging oil fields. Executives also say that rail allows companies more flexibility to ship to customers all over the country.

Morley said after the meeting that his company doesn't have a timeline in place for their rail-loading facility. Crews will begin work on the truck-to-pipe facility this summer. If both facilities come online, Morley said, Pronghorn customers could ship via pipe or rail.

“The intent is to provide customers with an option to ship,” he said.

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