New crude-rail terminal may bring more Canadian oil to US Gulf refiners

Global Partners and Kansas City Southern announced plans to develop a unit train terminal in Port Arthur, Texas. 

The waterborne terminal, which will be constructed on a 200-acre parcel leased by Global from KCS, will serve initially as a destination for heavy crude from Western Canada utilizing 340,000 bbl of initial storage capacity. 

Upon commencement of unit train service, the terminal is expected to have an initial capacity of up to 2 unit trains per day.

“The addition of a crude destination terminal on the US Gulf Coast will broaden and strengthen our logistics network,” said Global CEO Eric Slifka. “Situated within a 100-mile radius of nearly 5 million barrels of Gulf Coast refining capacity and an expansive pipeline network, Port Arthur is a prime destination for crude and refined products. 

"The terminal complements our assets on the East and West Coasts, expanding optionality for our customers," he added. "The Port Arthur site is advantageously positioned to serve the needs of producers, refiners and consumers, and we are proud to partner with one of North America’s premier commercial rail carriers to develop this project.”

Construction of the terminal is contingent upon Global’s receipt of all necessary permits.

“The Port Arthur terminal represents a significant opportunity to capitalize on strong demand for the movement of Western Canadian crude initially to one of the world’s premier refining centers in the US Gulf Coast,” said KCS chief executive David L. Starling. 

“Through their established base in the Northeast, North Dakota, Western Canada and the Pacific Northwest, Global has built an outstanding reputation for the quality of its logistics and terminal operations," he added.