UPDATE 1-Global Partners says NY railport expansion could be curbed

Mon Mar 31, 2014 1:47pm EDT
 
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(Adds quotes, detail about other rail projects and phase-out of older crude railcars)

March 31 (Reuters) - Global Partners LP's plans to expand its Albany, New York, crude rail-to-barge operation to handle heavy Canadian crude could be hampered by a government-imposed moratorium, Chief Executive Officer Eric Slifka told analysts on Monday.

The company runs a 160,000-barrel-per-day operation in which North Dakota Bakken crude oil is moved by rail to Albany, then loaded onto barges for delivery to East Coast refineries.

Global Partners is seeking permits to add boilers, reconfigure a railyard and make other changes to add the capability of handling heavy Canadian crude that must be heated before it is offloaded onto barges.

Earlier this month Albany County issued a moratorium that put the company's application to expand crude oil processing in the Port of Albany on hold pending results of a public health investigation.

In January New York Governor Andrew Cuomo directed a state safety review of crude-by-rail shipments from the Bakken oilfields after a spate of fiery crashes in the United States and Canada. The state expects to finish a report on rail safety by the end of April.

Albany has become a major shipping point for North Dakota crude. Buckeye Partners LP also has a 130,000 bpd rail-to-barge operation there.

Slifka said the moratorium does not affect current operations, but would hamper "the carrying of different products," such as Canadian crude.

"The facility continues to run and operate the way it has been for the past couple years," he said during the company's fourth-quarter earnings call. "We have applications in to try and broaden the array of products that we can carry at the facility and that's really what it's all about."   Continued...