Petroleum terminal expands to allow more oil trains

By Tony Schick

Oregon Public Broadcasting

PORTLAND, Ore. — A Portland petroleum terminal is significantly expanding its capacity to unload rail cars, a move that sets the stage to more than double the number of oil trains along the Columbia and Willamette rivers into Oregon’s biggest city, OPB has learned.

Zenith Energy, sandwiched between the river and Forest Park in the city’s northwest industrial district, began receiving train shipments of crude from Canada’s oil sands last year, records show, which it stored in tanks and later pumped onto ocean-going vessels.

Zenith’s outpost in Portland now has visible construction under way on a project to build three new rail platforms that will nearly quadruple the site’s previous capacity for offloading oil from tank cars, according to building plans filed with the City of Portland in 2014, which the city’s Bureau of Development Services confirmed Wednesday.

When operational, a terminal with such a capacity could handle multiple oil trains per week — a sizeable increase over Zenith’s 2018 operations. According to Oregon Department of Environmental Quality estimates, the site handled fewer than 30 full oil trains throughout last year.

Public resistance to oil projects

The site’s expansion of crude-by-rail infrastructure comes despite much public resistance in the Northwest for new oil projects. That includes a vote by Portland’s City Council in 2016 to oppose any new fossil fuel infrastructure. That same year the Northwest experienced firsthand one of the oil-train mishaps that have occurred across North America as more and more oil has been moved by what critics have dubbed “rolling pipelines” and “bombs trains.”

Public records and interviews with state officials indicate those trains would carry a kind of heavy oil that presents a new risk for Northwest communities and rivers, and one the state’s emergency spill responders say they are ill-equipped to contain if it spills.

“It greatly complicates the spill. It’s going to take a lot more money and time and cause a lot more harm to the environment probably,” said Scott Smith, who regulates the Zenith terminal’s oil spill preparedness as part of the Oregon DEQ emergency response program.

He said the increased oil-by-rail traffic creates a risk in Portland of an environmental disaster like the one in Michigan in 2010, when heavy Canadian oil spilled from a pipeline into the Kalamazoo River. It took more than five years and $1 billion to clean up.

“It’s really among the most challenging spills we have out there, and if it was a large spill, it would cause quite a bit of damage,” Smith said.

Zenith declined to comment on how the project would affect its ability to unload more crude oil, saying only that the project would allow it to fit additional railcars on site and minimize the need to shuffle cars around.

“The multi-million-dollar project will provide an even safer and more efficient operation,” Megan Mastal, a public-relations representative for Zenith Energy, said in an emailed statement.

The company also declined to say what products it would handle. Mastal disputed that Zenith would be handling what’s known as bitumen, which is a type of petroleum extracted from Canada’s oil sands. It is thick like peanut butter and often diluted with other petroleum products before it is transported.

“We are not handling bitumen crude through our terminal,” Mastal said.

Records show the facility did handle diluted bitumen in 2018, and Oregon’s Department of Environmental Quality said it anticipates the facility will be handling heavy crude from Canada’s oil sands.

Recent site inspections from Oregon’s Department of Transportation found railcars with the placard UN 1267 (Petroleum Crude Oil) on the tracks outside the Zenith facility, and that the cars were from Canada. Photographs of cars at the terminal from earlier this month also show cars with the 1267 placard, along with a placard warning of toxic inhalation.

From asphalt to Canadian crude

Five years ago, the site was an asphalt plant in limited operation when a company called Arc Logistics Partners LP, later acquired by Zenith Energy, purchased it and shifted operations to crude. That transition coincided with the North American oil boom and subsequent spike in oil moving by rail. While those shipments have declined since their peak nationally, data from the Energy Information Administration show oil by rail has reached its highest level in three years, driven largely by Canadian oil.

The Zenith site spans 39 acres with a storage capacity of nearly 1.5 million barrels and access to a nearby dock. Trains can reach it crossing the Willamette over the BNSF Railway bridge south of St. Johns or on Union Pacific tracks across the Steel Bridge.

Its main constraint has been rail capacity. When construction began, the terminal had space to unload 12 cars at a time, records show.

Plans for the facility upgrade of Arc Terminals filed in 2014 with the City of Portland depict a system capable of unloading 44 cars.

The company’s storage tanks are not getting any larger, but unloading more train cars simultaneously can expedite the process of transferring oil to ships, bound for export or other domestic markets.

Mastal said the work includes new emissions-control technology, which is required by regulations, as well as a state-of-the-art fire suppression system and barrier along the street. The Portland Bureau of Development Services confirmed the work includes numerous safety upgrades, many of which are now required by code.

Mastal said the terminal employs 18 people full time, all of whom are “trained and certified to maintain the highest environmental and operational standards.”

“Since Zenith purchased the terminal, we have added full-time staff positions. These jobs pay a family wage with benefits,” Mastal said. “In addition, the multi-million-dollar construction project uses local vendors and suppliers — currently averaging 125 individuals on site per day — providing significant economic stimulus for the area.”

The city issued permits for the work in 2014, two years before its leaders voted to oppose new fossil fuel infrastructure.

‘These trains present a significant risk’

Eileen Park, spokeswoman for Portland Mayor Ted Wheeler, said the mayor “supports further action to prohibit the construction of new fossil fuel infrastructure like the site in question.”

“These trains present a significant risk to Portlanders, most especially those residents close to railroads and routes through the city,” Park said. “On a larger scale, the threat of climate change depends on the bold and decisive actions of governments and leaders. The Mayor’s administration will not be supportive of any action that threatens the health and well-being of our city’s residents or our natural resources and environment.”

Mastal said Zenith’s Portland terminal meets all local, state and federal standards, including Portland’s 2016 ordinance.

“We are committed to delivering safe, reliable, efficient and flexible service to our customers while maintaining the highest environmental and operational safety standards,” she said.

Environmentalists say they fear a “rolling pipeline” of trains through Portland.

“To us, it seems like it’s another quiet effort to increase the capacity of that terminal to handle tar sands crude,” said Travis Williams of the Willamette Riverkeeper. “The vast majority of people in the city of Portland don’t want the risk — they don’t want the potential safety risk, the risk to the Willamette River, the risk to air quality in that area.”

Williams said he fears a repeat of the 2016 oil train derailment in Mosier, Oregon, only with a type of oil that is more difficult to contain and in an area like the Willamette, with a dense population and already a problem with existing pollution.

— OPB’s Amelia Templeton contributed reporting.