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Anacortes–Shell’s Bakken Rail Unloading Facility Moves Forward

Shell Oil Co./March Point

Shell Oil Company located on March Point, Anacortes, Wash.

Posted by: Mark Stayton for Skagit Valley Herald, Mount Vernon, Wash. in Bakken NewsEnergy, Dec. 21, 2013

ANACORTES — Shell’s Puget Sound Refinery on March Point is moving closer to building a rail offloading facility for crude oil from North Dakota’s Bakken formation now that high-level design work has been completed and the company is ready to apply for 17 permits required before construction starts. Shell needs the offloading facility to accept 100-car trains carrying roughly 60,000 barrels of crude oil from the formation, Refinery General Manager Thomas Rizzo said. The facility will be designed to handle up to one train in and out per day.

Shell has no plans for the rail facility to increase capacity at the 145,000-barrelper-day refinery, but Rizzo said less crude oil will be coming from two current sources: Alaska’s North Slope via tanker and to a lesser extent, Canada by pipeline.

“The facility is to allow us to bring in crude by rail from the Bakken fields, which we see as a key for us going down the road. The current supply of crude from Alaska is decreasing, so in order to ensure we have a supply of crude oil to make the products that our customers need, we need to find access to Bakken,” Rizzo said.

According to data from the U.S. Energy Information Administration, North Slope production peaked in 1988 at 722,447 barrels per day.

The Bakken formation has grown from producing less than 200,000 barrels per day in 2007 to an estimated 1 million-plus this month. It now contributes an estimated 10 percent of total U.S. oil production, according to the administration.

Rizzo said the plan to add an offloading facility was also driven by a need to compete with other refineries that have similar offloading facilities either built or planned.

The design for facility at the Anacortes refinery features a rail spur peeling off of the main Burlington Northern Santa Fe Railway line onto Shell property just west of East March Point Road. The tracks for unloading wind north for approximately 1 mile.

Rizzo said the facility will work by having the 100-car trains pull all the way up to the end of the track, detach the rear end of the train at car no. 50, back it up and pull it alongside the front part of the train on parallel tracks.

Either one or two over-ground pipes will run along the side of the cars, and individual hoses will connect the pipe or pipes to each car to collect the oil and bring it to a nearby holding tank before being pumped to the refinery’s large tank farm, Rizzo said.

The construction of the facility will affect 25 acres of wetlands on the property, said Paul Queary, vice president of communications at Strategies 360. Shell will buy credits from the Nookachamps Wetlands Mitigation Bank to offset the impact to wetlands, and money will be used to build new wetlands at the site west of the Skagit River between Mount Vernon and Burlington.

Rizzo said final designs for the offloading facility will be completed as local, state and national agencies review development, wetlands and environmental permits. Pending a final company approval for the project, construction will begin as soon as the permits are approved, Rizzo said.

Reporter Mark Stayton: 360-416-2112, mstayton@skagitpublishing. com, Twitter: @Mark_SVH, Facebook. com/byMarkStayton ___

(c)2013 the Skagit Valley Herald (Mount Vernon, Wash.)

Visit the Skagit Valley Herald (Mount Vernon, Wash.) at www.goskagit.com

Distributed by MCT Information Services

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