Kinder Morgan and Martin Midstream Partners are to form a joint venture, called Pecos Valley Producer Services, which will see a multi-commodity rail terminal built in Pecos, Texas.
The terminal will have a number of services such as oil hauling, storage, transloading and marketing. It will also give access to the Louisiana sweet crude oil markets for local producers.
The joint venture will offer NGL storage, takeaway, and fractionation services, and it has plans to develop natural gas and crude gathering and processing systems within the area.
The first phase of the development is scheduled to come online by May 2012, and the total railcar capacity will be about 300-600 a day, depending on the demand.
The terminal will serve the oil and gas sectors, which are growing, throughout the Permian Basin. It is located near the Pecos Valley Southern Railway and opposite the Union Pacific mainline in the city of Pecos.
The development is expected to create 45 new jobs and Bill Oglesby, executive director of the Pecos Economic Development Corporation, says: ‘This is a significant step for Pecos and Reeves County, and the development of our oil and gas resources.’
Duane Kokinda, president of Kinder Morgan Texas Pipeline, adds: ‘We believe this unique partnership will provide a wide range of services and expertise for the benefit of customers in Reeves County and surrounding areas, while expanding each company’s footprint in this very active rich gas shale play.’
Watco has won the contract to build the terminal, and the company is the largest privately held short line railroad business in the US.