Oregon approves permit for Global Partners crude oil railport

SAN FRANCISCO Wed Aug 20, 2014 7:11pm EDT

SAN FRANCISCO Aug 20 (Reuters) - Oregon environmental regulators on Tuesday approved an emissions control permit for a Global Partners LP railport along the Columbia River that clears the way for the firm to significantly increase the amount of crude oil it can receive via rail and load onto vessels to deliver to U.S. West Coast refineries.

The project is among many along the West Coast as refiners and logistics companies seek to tap cut-price crude from North Dakota's Bakken shale and Canada to replace more expensive imports. Those, and other energy projects, have faced growing opposition from residents and environmental groups.

Global Partners won permission to handle 1.8 billion gallons of crude oil and ethanol per year - up to 120,000 barrels per day - at its Columbia Pacific Bio-Refinery facility in Clatskanie. That is up from the 50 million gallons per year, or 3,261 barrels per day, that the previous permit allowed.

Oregon considers the expanded crude transloading operations a new source of air pollution, and the permit requires vapors released during vessel loading to be captured and controlled.

The regulators also approved an oil spill contingency plan for the facility after receiving about 1,400 public comments on the proposal.

The Oregon Department of Environmental Quality (DEQ) said it found no issues with the railport's design that would prevent permit compliance, nor would the facility present an imminent danger to human health or the environment.

The DEQ didn't address rail safety issues, as its permitting action was limited to the stationary emissions source.

Global Partners Chief Executive Eric Slifka said in a statement that the permit was the next step toward infrastructure upgrades that will bring more jobs to the area.

The new permit approval came after the state in March fined Global Partners $117,292 for shipping six times more crude oil than the previous permit allowed. The Massachusetts-based company is appealing that decision, but it doesn't affect the new permit.

Earlier this week, Oregon denied Ambre Energy's request for a permit to build a coal export terminal on the Columbia River, saying the project was not in the best interests of the state's water resources. Unlike the Global Partners project, Ambre's proposal required a new dock that the state said would impact historic tribal fishing sites.

Global Partners' project is similar to a much larger proposal from independent refiner Tesoro Corp about 55 miles away in Vancouver, Washington. Tesoro wants to build a railport that could bring in up to 360,000 bpd of Bakken and Canadian crude that also would help supply West Coast refineries.

Tesoro's proposal is undergoing a detailed state review as required for projects involving crude loaded onto a waterway, and must have Gov. Jay Inslee's approval before going forward.

David Monro, northwest region air quality manager for the Oregon DEQ, said Oregon doesn't require that kind of review.

(Additional reporting by Kristen Hays in Houston; editing by Andrew Hay)

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