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PBF Energy completes rail facility for Bakken crude oil delivery

Looking to move Bakken crude oil, PBF Energy Inc. announced Feb. 4 the completion of the second crude-oil unloading facility at its subsidiary’s refinery in Delaware City, Delaware. The construction of the 70,000-barrel-per-day (bpd) rail facility was announced in mid-2012 and was completed on schedule and on budget.

The first unit train of Bakken crude oil is expected to discharge this week, with 17 more unit trains scheduled to arrive in the next two weeks. With the completion of this project, the Delaware City rail facilities are now capable of discharging 110,000 bpd of crude oil directly at the refinery – 40,000 bpd of heavy crude oil and 70,000 bpd of light crude oil.

Tom Nimbley, PBF Energy’s CEO, commented that the completion of this rail facility puts its East Coast refining system at a competitive advantage compared to its Atlantic Basin peers. “PBF is now able to deliver significant quantities of cost-advantaged North American crude oils directly to Delaware City at very competitive pricing,” Nimbley said.

PBF Energy also announced that it has increased its previous guidance on the quantity of Canadian heavy crude that it can process at its Delaware City refinery. Based on the success the company has had running the Canadian heavy crudes to date, PBF Energy plans to increase the discharge capacity of the heavy-crude rail unloading facility to 80,000 bpd.

“We believe that Canadian heavy barrels will be the most economic barrels on the market,” Nimbley said, “and we intend to take the necessary steps to maximize our exposure to this advantaged crude.”

The new rail project should add an additional 40,000 bpd of heavy-crude unloading capability to the existing 40,000 bpd rail facility. The project is anticipated to cost approximately $50 million and to be completed in the fourth quarter of 2013. The project is expected to be approved this month at the company’s board meeting.

PBF Energy also announced that it has entered into agreements for an additional 2,000 coiled and insulated rail cars capable of handling heavy crude oil, and also for 500 general-purpose cars. The 2,000 coiled and insulated cars are expected to be delivered beginning in 2014 through the first quarter of 2015, and the 500 general-purpose cars will be delivered in 2013. This will bring PBF Energy’s total number of owned or leased coiled and insulated cars to 3,600, and will allow the company to move the previously mentioned 80,000 bpd of Canadian heavy crude in its own rail cars.

PBF Energy is one of the largest independent refiners in North America, operating, through its subsidiaries, oil refineries and related facilities in Delaware City, Delaware; Paulsboro, New Jersey; and Toledo, Ohio.


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