By May 26, 2015 Read More →

Permian Basin rail hub for frac sand, oil proposed for Big Spring, TX

Partners will build facilities in Permian Basin, DJ Basin

A new energy rail hub to transport frac sand and crude oil will be built in the Permian Basin near Big Spring, TX. The partners behind the project expect it to be operational early in 2016.

Permian Basin

Hi-Crush sand facility. Photo: Hi-Crush Partners.

Hi-Crush Partners LP and ARB Midstream, LLC say the companies have agreed to jointly develop and operate two energy rail hubs, one in theone in the Permian Basin and the other in the DJ Basin, located in the Rocky Mountain region. Both facilities will be served by the Union Pacific Railroad, providing unit and manifest train capabilities for proppant (frac sand) and crude oil.

Hi-Crush will operate the frac sand terminals at these facilities, with the frac sand sourced from its production facilities in Wisconsin, and ARB will operate the crude-by-rail terminals.

“There is a lack of terminal capacity for proppant and crude oil in the Big Spring region,” said Adam Bedard, CEO of ARB..  “Our terminal will provide the critical infrastructure to serve our customers’ in-basin needs, with the crude oil terminal being pipe connected to a large, regional gathering system.”

The Permian Gateway energy rail hub will be built on 300 acres in Howard County, near Big Spring.  ARB has entered into an agreement to purchase the acreage with the closing expected to occur in May.  The frac sand infrastructure will include silo storage capacity, allowing it to accommodate unit trains.

“By establishing a presence in the DJ Basin and significantly expanding our presence in the Permian Basin, we are excited to further expand our extensive distribution network to better serve our customers’ in-basin needs,” said Robert E. Rasmus, co-CEO of Hi-Crush.

“We remain focused on delivering a low-cost solution to our customers and look forward to a successful partnership with ARB.”

The DJ Basin facility will be located on a 225-acre site in Weld County, Colorado.  The frac sand infrastructure will include also silo storage capacity.  The crude oil infrastructure will accommodate multiple grades of crude oil and have initial storage capacity of 200,000 barrels, expandable to over 400,000 barrels.  Rail-loading capacity will be approximately 79,000 barrels per day of crude oil, with initial truck unload capacity of 35,000 barrels per day. The Nicon facility is expected to be commercially operational in the fourth quarter of 2015.

“ARB is excited to partner with Hi-Crush on these projects,” said Bedard. “Entering a long-term relationship with one of the leading providers of frac sand is complementary to our vision of growth providing integrated terminals to the oil and gas industry in North America.”

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