Nustar wants to handle crude oil locally

Company with two Vancouver sites is seeking permit

By Erin Middlewood, Columbian special projects reporter

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The proposed Tesoro-Savage terminal, which would be the largest oil-by-rail facility in the Northwest, has overshadowed a smaller but significant crude oil proposal for Vancouver.

NuStar Energy L.P. of San Antonio wants to handle as many as 50,000 barrels of domestic light, sweet crude a day at its Vancouver bulk terminals. By comparison, the proposed Tesoro-Savage terminal would be capable of handling 380,000 barrels a day.

"This is a potential project that is still in the early stages of development," NuStar spokesman Chris Cho said. "Our Vancouver terminal handles petrochemicals, petroleum fuels and dry bulk materials and has done so safely for decades."

Because of its much smaller scale, the NuStar proposal won't undergo the rigorous review of the state's Energy Facility Site Evaluation Council, which is currently evaluating the Tesoro-Savage application. EFSEC will make a recommendation to Gov. Jay Inslee on that proposal in the coming months. The governor has the final say.

NuStar, which had $3.4 billion in revenue in 2013, offers bulk storage at the Port of Vancouver and an annex off Fruit Valley Road. Between the two Vancouver facilities, NuStar can store 345,000 barrels of chemicals and 433,000 barrels of petroleum products, according to company filings with the Securities and Exchange Commission.

NuStar has handled jet fuel, antifreeze, diesel, methanol and other products at its Vancouver terminals, but not crude oil. In April, NuStar submitted an application for an air quality permit with the Southwest Clean Air Agency to convert a tank at each of its locations to handle crude oil. The terminals would receive oil by rail, and then ship it out by barge.

The clean air agency determined that the project would not have significant environmental impacts, but requested comments from other agencies and the public. In a letter to the clean air agency, the state Department of Ecology indicated NuStar should do a seismic study on the tanks, and should provide more information about spill prevention planning and rail loading.

One sharp-eyed neighbor also wrote a letter to the clean air agency. William Brake, who has been following news stories about the Tesoro-Savage oil terminal, spotted the clean air agency's request for comments on the NuStar proposal.

"Curiosity got me," said Brake, who lives in Vancouver's Felida neighborhood. "That NuStar facility is just down the road from where I live."

Brake happens to be a retired chemical engineer who spent his career working in the natural gas industry. He's wary of crude oil.

"It's unprocessed and raw, and varies in composition and hazards," Brake said. "It's even more dangerous because (NuStar) won't have the ability to handle unit trains. They'll have to break up the trains in smaller sections. … There's more risk of something catastrophic happening."

Wess Safford, a clean air agency engineer, said his office is working on its response to the comments before issuing NuStar's air quality permit.