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Go Your Own Way – CN Railroad Facilities to Offload Crude On The Gulf Coast

Five large-scale rail terminals planned or being constructed in Western Canada will be able to ship up to 550 Mb/d of crude by 2015. Most of that crude will be headed to the Gulf Coast. If crude by rail shipments from Canada are going to compete with pipeline alternatives then the ability to ship bitumen crude raw without diluent will be an important advantage. Yet only about 170 Mb/d of rail terminal capacity is currently built or being developed on the Gulf Coast that can offload raw bitumen using special heating equipment. Today we complete a survey of CN railroad unloading facilities at the Gulf Coast.

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If you are new to the topic of moving heavy Canadian crude (bitumen) by rail you can bring yourself up-to-speed by looking at previous posts on growing Canadian bitumen production (see Heat it!  Bitumen Economics Part 1) and the options for moving heavy bitumen crude by rail – including various levels of dilution with light hydrocarbons known as “diluent” (see Heat it! Bitumen Economics Part 2).

In the first episode in this series we attempted to answer two key questions that determine the fate of Canadian heavy crude shipments by rail (see Go Your Own Way – The Rail vs. Pipeline Bitumen Challenge). First - is rail capacity needed to supplant a shortfall in available pipelines now or in the future? Second can the cost of bitumen by rail transport compete against pipelines? We concluded that there is no clear answer to these questions. In the second and third episodes we surveyed the rail terminals currently being planned and built to load heavy crude in Western Canada (see Go Your Own Way Alberta Rail Load Terminals Part 1 and Part 2). In the third episode we began a survey of purpose built rail terminals to handle heavy crude oil from Canada on the Gulf Coast. We provided a fairly detailed description of the facility being developed by CN railroad and Arc Terminals at Mobile (see Go Your Own Way – Offloading Heavy Canadian Crude On The Gulf Coast). This time we will run through the remaining seven CN railroad terminals shown on the map below.

Source: CN Railroad Presentation



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Genesis Energy LP – Natchez MS and Maryland Baton Rouge

Genesis Energy LP is a US midstream master limited partnership (MLP – see Masters of the Midstream) that provides pipeline transportation, refinery services and crude logistics including rail and barge terminals. The company operates crude by rail offloading terminals in Louisiana, Mississippi, Florida, West Texas and Wyoming. They have approximately 400 leased rail tank cars and 50 crude oil barges.  Genesis recently (July 2013) expanded their coastal barge fleet through acquisition of Hornbeck Offshore Transportation LLC.

Genesis operate a crude oil rail unloading / loading terminal in Natchez, MS. The terminal is located on the short line Natchez Railway that is connected to the CN mainline. The facility has infrastructure to unload raw bitumen as well as dilbit and is reported to be able to load diluent for backhaul to Canada. The facility has been operational since January 2013 and is now able to unload up to 40 tank cars per day. The initial throughput was 15 Mb/d shipped by Southern Pacific from Lynton, Alberta and a second customer began shipping in July 2013. Terminal storage includes a new 100 MBbl tank and two refurbished 30 MBbl tanks.  In response to increased demand, Genesis is proceeding with a Phase II expansion to provide an additional 60 rail car spots to be fully operational by the end of 2013 – meaning they can unload unit trains with estimated capacity of 50 Mb/d.

Genesis is also building out a crude oil pipeline and a unit train-unloading terminal in Port Hudson, LA to connect into the Anchorage Tank Farm that serves the 500 Mb/d ExxonMobil Baton Rouge refinery. The Scenic Station rail terminal will be built at Maryland just south of Baton Rouge and is expected to be completed in Q2 2014. This rail terminal will be connected to the CN network as well as Kansas City Southern (KCS) and will be able to handle regular and dilbit crude but it is not known if it will be able to handle raw bitumen.

LBC Sunshine Terminal, St Gabriel, LA

LBC Tank Terminals, headquartered in Belgium, is one of the world’s largest global operators of bulk liquid storage facilities for chemical and oil products. The company is expanding their rail receipt facilities at Baton Rouge to handle larger quantities of raw bitumen crude shipped from Canada by CN railroad. The LBC Sunshine terminal (see picture below) is located within the Geismar Industrial Complex ten miles south of Baton Rouge, Louisiana, on the Mississippi River. The company already has heated tanks and steam heating facilities to handle raw bitumen unloading. Heavy crude can be redistributed via the Mississippi River. To our knowledge, LBC has not publically disclosed any information about their volume unloading capability.

Source: LBC Tank Terminals Website


Crosstex Energy Services, Geismar

Crosstex Energy, L.P. is a midstream natural gas company that operates approximately 3,500 miles of natural gas, natural gas liquids, and oil pipelines, 10 processing plants and four fractionators. Crosstex also operate barge terminals, rail terminals, product storage facilities, brine water disposal wells and an extensive truck fleet.

The Crosstex Energy terminal in Geismar, close to Baton Rouge forms part of the company’s Riverside fractionator facility. The rail unloading facility is quite small and until recently could only handle 4.5 Mb/d but has been upgraded this year to15 Mb/d completed in June 2013. The facility includes 100 MBbl of above ground tank storage, a rail spur with 26 rail tank car spots with crude load and offloading capabilities. Crosstex unload crude oil and natural gas liquids onto barges or into pipelines. The terminal is connected to the CN railroad and all the current capacity is understood to be committed to Bridger Logistics.

International Matex Tank Terminals (IMTT) St Rose, LA

Privately held IMTT (50% owned by Maquarie), has been in operation for over 70 years and owns and operates 12 bulk liquid storage terminal facilities in North America with aggregate capacity of approximately 42 million barrels. The company stores and handles petroleum products, vegetable and tropical oils, renewable fuels, and various chemicals. Headquartered in New Orleans, IMTT is the fourth largest provider of bulk liquid storage and handling services in the United States.

The IMTT St Rose marine terminal is located on the East Bank of the lower Mississippi River 15 miles West of New Orleans. The terminal has 5 deepwater tank berths and 13 barge berths (see picture below). The facility is served by the CN railroad and has railcar unloading facilities including steam and tank heating. There is significant storage (over 14 MMBbl) at St Rose but it is not clear how much is used for crude oil. The rail unloading capacity is not known but is likely to be limited to a small number of rail tank cars at present with potential to expand.

Source: IMMTT Website (Click to Enlarge)


Valero St Charles, LA Refinery Rail Terminal

Valero, the world’s largest independent refiner by processing capacity, is building a rail unloading facility to handle raw bitumen shipments from Canada at its St Charles, LA 270 Mb/d heavy crude refinery. The refinery currently processes heavy crude from Mexico and Venezuela that is received from the LOOP terminal (see Thrown for a LOOP) and 5 marine docks on the Mississippi adjacent to the refinery. But Valero is building rail infrastructure to provide the option to unload up to 20 Mb/d of crude from Canada by the end of 2013, increasing to 30 Mb/d next year. Valero has invested heavily in supplying its refineries with crude by rail and purchased over 5000 rail tank cars of its own. The St Charles unload facility will use 1600 of these rail tank cars that are coiled and insulated to bring raw bitumen from Canada via CN railroad. Valero is also processing Canadian dilbit crude shipped by barge from a delivery point on the Keystone pipeline at Hartford, IL.

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