North America

TERMINAL NEWS

US

US$4.5 BILLION CLEAN HYDROGEN HUB TO BE BUILT IN LOUISIANA

US industrial gas company Air Products is to build a US$4.5 billion (€3.9 billion) blue hydrogen clean energy complex in Ascension Parish, Louisiana, US.

The complex, which will be built, owned, and operated by Air Products, will produce more than 750 million scfd of blue hydrogen from natural gas, capturing around 95% of the produced CO2 for permanent storage. Some of the hydrogen produced will be compressed for supply to Air Products’ customers on the US Gulf Coast, via its existing pipeline network. The rest will be used to make blue ammonia for transport around the world, for conversion back into hydrogen. The co-products – liquid nitrogen, liquid oxygen and liquid argon –will also be supplied to customers around the world. The CO2 captured at the facility will be compressed and transported via pipeline to a number of inland sequestration sites, where it will be stored in geologic pore space around 1 mile (1.6 km) below the surface. Air Products has received approval from the Louisiana State Mineral and Energy Board, part of the Louisiana Department of Natural Resources, for the permanent sequestration of the CO2. The project will generate 2,000 construction jobs over three years and 170 permanent jobs, with an expected annual payroll of US$15.9 million. The project is Air Products’ largest ever investment in the US. ‘This is a major industrial investment that will create quality manufacturing jobs while limiting environmental impacts, a goal envisioned by my Climate Initiatives Task Force. Carbon capture and sequestration are important to Louisiana’s efforts to reduce carbon dioxide emissions while maintaining jobs and growing our manufacturing base. This project is a clear demonstration of our ability to grow the Louisiana economy while lowering the carbon footprint of industry,’ says Louisiana Governor John Bel Edwards, who announced news of the project alongside Air Products chairman, president and CEO Seifi Ghasemi. Air Products is also building a net zero hydrogen complex in Edmonton, Canada, and a green ammonia production facility joint venture in NEOM, Saudi Arabia powered by renewable energy. ‘In addition to our leadership in grey hydrogen, our Canada project and this Louisiana project make us the leader in blue hydrogen. We also will be the world leader in the production and supply of green, carbon-free hydrogen when the NEOM Project comes onstream. The energy transition will occur in stages, and the megaproject we are announcing today in Louisiana will help the state meet its ambitious goals while providing new sources of blue products for customers in the US and around the globe,’ says Ghasemi. Hydrogen as potential fuel of the future seems to be gaining momentum globally, as governments and companies seek to meet climate targets. Earlier in October 2021, Exolum announced it would build a €2 million green hydrogen production plant near Madrid in Spain, using Fusion Fuel technology, while BP is considering producing green hydrogen at its Kwinana refinery site, which is shutting down. BP is also planning a 1 GW blue hydrogen plant in the UK. The Port of Rotterdam Authority, Koole Terminals, Chiyoda Corporation and Mitsubishi Corporation are carrying out a feasibility study into commercial-scale hydrogen imports. In the US, clean infrastructure firm Bakken Energy bought the assets of the Dakota Gasification Company (Dakota Gas), including the Great Plains Synfuels Plant in North Dakota, US, from Basin Electric, to form a hydrogen hub.

US

CALUMET AWARDS SEVEN-TANK CONTRACT TO MATRIX

US speciality petrochemicals producer Calumet Specialty Products Partners has awarded a contract for the engineering, fabrication and construction of seven new renewable diesel storage tanks in Great Falls, Montana, US, to Matrix Service.

Calumet is developing a renewable fuel plant at its Great Falls site, which is expected to be operational in Q2 2022. The new tanks will support the production of up to 12,000 bpd of renewable diesel from soybean oil feedstock. Engineering for the tank project will be carried out by Matrix Service’s sister company, Matrix PDM Engineering. ‘We are excited to help lead the North America’s energy transition in Montana, the Pacific Northwest, and western Canada. This project will help diversify our nation’s energy sources and reduce our carbon footprint immediately,’ says Bruce Fleming, executive vice president of Calumet. ‘We are pleased to have Matrix Service provide the engineering, fabrication, and construction of our renewable storage tanks for this critical infrastructure project.’

US

VOPAK OPENS GULF COAST INDUSTRIAL TERMINAL

Vopak has opened a new industrial terminal on the US Gulf Coast to serve Gulf Coast Growth Ventures (GCGV), a joint venture by ExxonMobil and SABIC for a worldscale plastics facility in San Patricio County, Texas, US.

The new terminal, which is 100% owned and operated by Vopak, has a total capacity of 144,000 m3. It is connected to the petrochemical complex by pipelines. The terminal has a 20-year commercial agreement in place. The multibillion-dollar GCGV project will make use of low-cost US gas. A cracker will produce 1.8 million tpa of ethylene from ethane, which will feed a monoethylene glycol unit and two polyethylene units. Construction began in Q3 2019 and the facility is expected to start up in 2022. ‘We are very excited to have successfully and timely delivered this new industrial terminal to support GCGV in the US. This new terminal fits well into our growth strategy for industrial terminals,’ says Eelco Hoekstra, chairman and CEO of Royal Vopak. ‘We are proud of our expertise and long track record of storing vital products. We have high standards on safety and environmental care and we are looking forward to being part of the Coastal Bend community.’

US

HOWARD ENERGY PARTNERS NAMED ‘MOST IMPROVED’ BY GRESB

US midstream company Howard Energy Partners (HEP) has been named as the ‘most improved’ in the GRESB 2021 Infrastructure Assessment.

GRESB (formerly Global Real Estate Sustainability Benchmark) is an index which assesses the environmental, social and corporate governance (ESG) performance of assets including buildings and infrastructure. It is one of the world’s leading sustainability benchmark, used as a comparison tool by investment funds to rate the quality of their investments regarding sustainability. HEP’s assets include natural gas and crude oil gathering and transportation pipelines, natural gas processing plants, liquid storage terminals, deep-water dock and terminal facilities, and rail, terminal and transloading facilities in Texas, New Mexico, Oklahoma, and Pennsylvania in the US and in Mexico.

Brandon Burch, executive vice president and chief operations officer of HEP says that the company is proud of the GRESB recognition as it is testament to the company’s ongoing efforts to provide clean, reliable energy. ‘We are proud to celebrate the achievements made by this year’s Most Improved organisations. Your dedication to advancing ESG transparency and performance is helping accelerate the whole industry’s progress towards a more sustainable world,’ says Sebastien Roussotte, CEO of GRESB. ‘ESG transparency and improved performance have never been more important, and it is inspiring to see such a high level of dedication from the industry, particularly when so much has been disrupted by the pandemic this last year.’

US

REGEN III READY TO PROCEED WITH RE-REFINERY AT OILTANKING GALVESTON

US cleantech company ReGen III is to begin front end engineering and design (FEED) work for a used motor oil re-refinery at Oiltanking Galveston County Terminal in in Texas City, US.

Oiltanking North America has issued a letter of readiness (LOR) to ReGen III to proceed after the successful completion of work on the pre-FEED/front-end loading (FEL-2) validation. Oiltanking is expecting the final independent report from its engineers, Burns & McDonnell, within the next week, and the LOR states that it will be ready to move to FEED on 18 October 2021. The re-refinery will take used motor oil and re-refine it into clean base oils for the domestic market. The process removes soluble and insoluble impurities to make a final product at least equal in quality to virgin base oils. The process uses less energy than crude oil refining. Oiltanking North America and ReGen III signed a non-binding letter of intent to build the re-refinery in July 2021, with Oiltanking agreeing to lease land at its Galveston County Terminal, and design, construct, and operate storage tanks, loading and unloading pipelines, rail and marine loading and unloading facilities and other logistics assets for the re-refinery. The FEL-2 pre-feasibility study aimed to develop cost and schedule estimates, and make any critical decisions that will influence the final design of the storage tanks, loading/unloading pipelines, rail and marine loading/unloading facilities and other logistics assets. Oiltanking will be responsible for designing, constructing, operating and maintaining the logistics assets. ReGen III and Oiltanking are working towards finalising and signing the longterm ground lease and the site services agreement. ‘As one of the largest independent tank storage providers for gases, chemicals and petroleum products in the world, Oiltanking is successfully active in the engineering, procurement and construction of tank terminals. Our experienced team is working closely together with ReGen III on a tailor-made and cost-effective infrastructure solution for their re-refinery facility at our terminal in Texas City. We look forward to advancing the project as it will provide a much-needed domestic supply of base oils recycled from used motor oil thus, strengthening the circular economy,’ says Dan Withers, director, business development at Oiltanking.

US

SENTINEL AND EXXONMOBIL FORM HOUSTON PIPELINE JV

Sentinel Midstream Texas and ExxonMobil Pipeline Company have formed a joint venture, Enercoast Midstream, to operate crude oil pipelines and transport infrastructure in Houston, US.

Enercoast will provide the ‘last-mile link’ for crude, including from the Permian and Gulf of Mexico, into the Houston crude oil market. Sentinel will be the operator of the JV, and has contributed cags for a majority equity position. ExxonMobil meanwhile has contributed a 16” pipeline originating at Webster Terminal with delivery points at ExxonMobil’s Baytown Refinery and Seabrook export terminal, and a 20” crude pipeline with access to Moore Road station. Sentinel says that it will work to commercialise capacity on the Enercoast system and increase its operating footprint by building or acquiring new pipelines. Tariffs are available on the Sentinel website. ‘We are extremely pleased to establish a joint venture with ExxonMobil to maximise the potential of Enercoast,’ says Jeff Ballard, president and CEO of Sentinel. ‘Sentinel looks forward to the opportunity to serve ExxonMobil and other shippers in the Houston market.’

US

SUNOCO COMPLETES NUSTAR AND CATO ACQUISITIONS

US fuel distributor Sunoco has successfully completed the acquisition of eight refined products terminals from NuStar Energy and Cato, for which it paid US$255.5 million (€215.1 million).

The deals to buy the terminals were first announced in August 2021 and were expected to close by the end of the year. Sunoco says it funded the acquisitions with cash on hand and through its revolving credit facility. From NuStar, Sunoco bought the Blue Island terminal in Illinois, Andrews Air Force Base, Baltimore and Piney Point in Maryland, Jacksonville in Florida, Linden and Paulsboro in New Jersey, and Virginia Beach in Virginia. The combined storage capacity of the terminals is 14.8 million bbl. From Cato it bought the 140,000 bbl terminal in Salisbury, Maryland, which and stores gasoline and distillate. ‘These accretive acquisitions significantly expand SUN’s midstream business and enhance its platform for fuel distribution growth,’ Sunoco says in a statement.

US

SHELL CONSORTIUM CHOSEN FOR LIQUID HYDROGEN STORAGE DEMO

A consortium led by a Shell subsidiary has been selected by the US Department of Energy (DOE) to demonstrate the feasibility of largescale liquid hydrogen (LH2) storage.

The consortium comprises Shell International Exploration and Production, McDermott’s CB&I Storage Solutions, NASA’s Kennedy Space Center, GenH2 and the University of Houston. The DOE’s Hydrogen and Fuel Cell Technologies Office has asked the consortium to show that large-scale tanks, from 20,000-100,000 m3 in capacity, can be feasible and cost competitive at import and export terminals. The project will have a total budget of US$12 million (€10.3 million). DOE has awarded the consortium US$6 million, while Shell and CB&I Storage Solutions will each provide an additional US$3 million. Plans for the project include developing a concept design for the large-scale LH2 storage tanks, and engineering and building a scaled-down demonstration tank to validate the feasibility of the design and the thermal model for commercial-scale design. The consortium partners each bring unique expertise to the project. Shell International Exploration and Production will provide guidance on hydrogen supply chain and safety. CB&I will advise on engineering, design and LH2 construction storage. GenH2 will design and manufacture one of the world’s most advanced thermal testing devices, known as Cryostat-900. The Kennedy Space Center already has the largest LH2 storage tanks in the world so NASA brings a wealth of experience, and will work with GenH2 on novel testing development. Academics from the University of Houston will develop detailed thermal models of the proposed insulation systems. The technologies developed as part of the project, including insulation technology, cryogenic testing equipment and thermal model, are expected to have wider, long-term benefits for LH2 applications. The project will help to reduce the cost of clean hydrogen and advance its role in the energy transition, and eventually achieve a global clean hydrogen supply chain. ‘A cost-effective, long-range hydrogen supply chain can have a transformative impact in shaping a sustainable future for energy. Our consortium recognises that this project can become a cornerstone in making that future possible. It’s a sizable engineering challenge – but we have the right people, partners and outlook to deliver this first-of-its-kind LH2 storage technology,’ says Yuri Sebregts, chief technology officer for Shell.

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US

NEW BULK JET FUEL STORAGE FACILITY OPENS IN ST LOUIS

A new 3 million gallon (13.6 million L) bulk jet fuel storage facility has opened at St Louis Lambert International Airport (STL) in the US.

The facility cost US$50 million (€43.1 million) and was designed and built by engineering firm Burns & McDonnell. It has three 1 million gallon aboveground storage tanks, an 11,000’ (3,353 m) underground fuel transmission pipeline with a leak detection system to deliver fuel to the terminal and five horizontal pumps capable of delivering 1,200 gallons of fuel per minute. The facility also includes a 4,300 ft2 operations building with a control room, offices and vehicle maintenance shop. STL invested an additional US$50 million in other fuelling infrastructure, including hydrant system improvements, a new emergency fuel shut-off system, a hydrant cart test facility, a truck load facility and parking, and new fuelling stations for ground service equipment. The new facility, which has space for an additional 1 million gallon tank, should that be required in future, is double the size of the previous facility, built 60 years ago. Rhonda HammNiebruegge, STL airport director, says that the new facilities will support future airport growth.

US

KINDER MORGAN AND NESTE JOIN FOR US RENEWABLE LOGISTICS

US energy infrastructure company Kinder Morgan and Finnish sustainable fuel and feedstock firm Neste are to develop a renewable raw materials supply hub at Kinder Morgan’s facility in Harvey, Louisiana, US.

Kinder Morgan plans to modify 30 existing tanks, and pipelines, to create segregated storage for raw material for Neste. This will include installing a new boiler to heat tanks and railcars, and infrastructure improvements for rail, truck and marine movements. The work, which is expected to be completed by Q1 2023, will be supported by the long-term commercial agreement with Neste. Neste will store feedstocks for renewable diesel, sustainable aviation fuel (SAF), polymers and chemicals, including used cooking oil (UCO), which it already collects from more than 40,000 US restaurants. The company has an option to further expand the facility if and when required. Neste says that the project will support a ‘more resilient, flexible and sustainable supply chain’, in turn supporting its growing production capacity to meet demand. In the longterm, the partnership with Kinder Morgan could improve the climate benefits and competitiveness of Neste’s products, due to more efficient, less carbon-intensive supply chain operations. Jeremy Baines, president of Neste US says: ‘This clearly shows the positive role America’s existing energy infrastructure can play in creating a sustainable future and fighting climate change. Neste and Kinder Morgan are transforming existing terminal assets into what can be considered green infrastructure, which will ultimately enable more American businesses and cities to power their fleets and supply chains with renewable fuels and other products.’ Kinder Morgan and Neste have previously partnered for sustainable projects, with Neste supplying SAF to San Francisco International airport through a Kinder Morgan pipeline since 2020, more than 1 million gallons so far. Kinder Morgan says that the agreement shows its commitment to offering low-carbon infrastructure solutions. ‘As North America’s largest terminal operator with existing infrastructure including 80 million barrels of storage, 266 docks, 462 truck bays and 6,800 rail car spots, Kinder Morgan Terminals is uniquely positioned to play a leading role in the transition to renewable fuels,’ says John Schlosser, president of Kinder Morgan Terminals.

US

CHEVRON AND ENTERPRISE TO STUDY CCUS

Chevron New Energies, part of US oil major Chevron, and a subsidiary of US midstream company Enterprise Products Partners are to jointly study business opportunities for carbon capture, utilisation, and storage (CCUS).

The companies expect the initial phase of the study to last six months. They will evaluate possible CCUS projects that combine Enterprise’s extensive midstream pipeline and storage network with Chevron’s sub-surface expertise. ‘The joint study with Chevron is part of our growing focus on developing and utilising new technologies and leveraging our transportation and storage network in order to better manage our own carbon footprint and provide customers with new midstream services to support a lower carbon economy. Our success in upgrading and repurposing existing assets will be important to the success of any initiative we move forward with,’ says AJ ‘Jim’ Teague, co-CEO of Enterprise’s general partner.

US

FIRE AT SECURE ENERGY’S ALBERTA TANK FARM

No casualties have been reported following a fire at Secure Energy’s Elk Point tank farm in Alberta, Canada on 23 October 2021.

Secure Energy told Global News that the fire broke out at 2.35pm local time. The company immediately initiated its emergency response plan, which included contacting local emergency services. Royal Canadian Mounted Police (RCMP) Alberta, which was amongst the responders, tweeted that the fire had been contained to the tank farm site and that no residences were under threat. It recommended avoiding driving in the area due to smoke. Officers closed the nearby Highway 640 to allow access for emergency personnel and equipment. ‘The fire is out, and we are working with all appropriate authorities to investigate the cause. The safety of our employees, the public and the environment remain our top priority,’ Secure Energy said in its statement to Global News.

US

PHILLIPS 66 TO BUY PHILLIPS 66 PARTNERS

US energy company Phillips 66 is to buy all remaining shares that it does not already own in midstream partnership Phillips 66 Partners.

Phillips 66 set up Phillips 66 Partners to operate, develop and acquire primarily fee-based crude oil, refined petroleum products and natural gas liquids pipelines, terminals and other midstream assets. Following the transaction, expected to be completed in Q1 2022, Phillips 66 Partners will become a wholly owned subsidiary of Phillips 66 and will no longer be a publicly traded partnership. Phillips 66 says that the transaction will simplify the governance and corporate structure. The all-stock deal is worth US$3.4 billion, based on the closing price of the companies on 26 October 2021. For each share they hold, Phillips 66 Partners shareholders will receive 0.5 of a share of Phillips 66 common stock. ‘We believe this acquisition will allow both [Phillips 66] PSX shareholders and [Phillips 66 Partners] PSXP unitholders to participate in the value creation of the combined entities, supported by the strong financial position of Phillips 66,’ says Greg Garland, chairman and CEO of Phillips 66.

US

OPERATOR ERROR CAUSED US NAVY’S HAWAII TANK FARM LEAK

The US Navy has completed an investigation into a leak from its Red Hill fuel tank storage facility in Hawaii on 6 May 2021 and found that it was caused by operator error.

Red Hill consists of 20 underground fuel storage tanks, dating back to the 1940s, and there have been longstanding concerns about the integrity of the tanks, particularly as they sit above a drinking water aquifer. However, according to a statement released to AP by the US Navy, an investigation by the Naval Petroleum Office of the Naval Supply Systems Command found that the leak of 1,618 gallons (6,125 L) of jet fuel in May came from a pipeline, rather than the tanks. An operator did not follow the correct procedures to close fuel line valves during fuel transfer operations, causing a pressure surge in in the system, which blew out a part and resulted in the fuel release. In the statement to AP, Navy Region Hawaii said that all but 38 gallons of the spilt fuel had been recovered. The Red Hill storage tanks were undamaged during the incident and all have subsequently passed tank tightness tests. The Navy has now added additional safeguarding measures to prevent recurrence, such as requiring more system operators in the control room during fuel transfer procedures.

Canada

BROOKFIELD CLOSES INTER PIPELINE ACQUISITION

Brookfield Infrastructure Partners has successfully completed its acquisition of Inter Pipeline.

Shareholders representing 99.91% of Inter Pipeline shares approved the agreed arrangement in a meeting on 28 October 2021. After obtaining the necessary shareholder approvals, Inter Pipeline received a final order of the Court of Queen’s Bench of Alberta approving the arrangement. For each Inter Pipeline share they hold, shareholders elected to receive either C$20 (€13.90) in cash, 0.250 of a class A exchangeable subordinate voting share of Brookfield Infrastructure Partners Corporation, 0.250 of a class B limited partnership unit of Brookfield Infrastructure Corporation Exchange Limited Partnership, or any combination. The takeover agreement was first announced in September 2021, after months of negotiations. Inter Pipeline shares will be delisted from the Toronto Stock Exchange on 1 November 2021. As previously announced, Christian Bayle, Inter Pipeline president and CEO, and Brent Heagy, CFO, have stepped down from their management positions and Bayle has also resigned from the Inter Pipeline board. Brian Baker has been appointed as interim CEO while a permanent replacement is sought, and Paul Hawksworth has been appointed CFO.

US

ENBRIDGE COMPLETES MODA ASSETS ACQUISITION

North American energy infrastructure company Enbridge has closed the acquisition of Moda Midstream Operating from Encap Flatrock Midstream for US$3 billion (€2.6 million).

The deal was originally announced in September 2021. Enbridge now has a 100% operating interest in the former Moda Ingleside Energy Center (MIEC), now the Enbridge Ingleside Energy Center (EIEC). The deal also included the 350,000 bbl Taft Terminal, the 300,000 bpd Viola pipeline, and a 20% interest in the 670,000 bpd Cactus II pipeline. ‘The acquisition significantly advances the company’s US Gulf Coast export strategy and connectivity to low-cost and long-lived reserves in the Permian and Eagle Ford basins,’ says Enbridge in a statement.

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