USD to test crude-by-rail shipments with new customer at Oklahoma terminal

USD Partners L.P. last week announced it entered into a three-month rail-to-truck terminal services agreement with a new third-party customer at a terminal in Stroud, Oklahoma.

Served by the Stillwater Central Railroad, the terminal will be tested as a destination for waxy crude oil produced in the Uinta Basin in eastern Utah. If tests are successful, a longer-term terminal services agreement could be executed with the customer, said USD officials — who did not identify the customer — in a press release.

Inbound freight is delivered to the Stroud terminal by the 400-mile Stillwater Central, a Watco-owned short line that interchanges with BNSF Railway Co. and Union Pacific Railroad. Outbound crude-oil shipments are transported via USD’s 17-mile pipeline from the terminal to a storage hub in Cushing, Oklahoma.

The terminal features unit train-capable unloading capacity of about 60,000 barrels per day — which is expandable to 80,000 barrels — and two onsite tanks with 140,000 barrels of total capacity.

“We are excited about this new business opportunity and the re-purposing of our Stroud Terminal to handle waxy crude from the Uinta Basin,” said USD Group Chief Commercial Officer Brad Sanders. “The Uinta Basin’s significant growth trajectory is constrained by its lack of access to rail logistics destinations.”

USD's operations include rail-car loading and unloading, inbound and outbound pipeline connectivity, truck transloading and other related logistics services. In addition, the partnership provides leased rail cars and fleet services to facilitate the transportation of liquid hydrocarbons and biofuels by rail.