A Fortune 500 company has been given the go ahead to build a new trans-loading operation northeast of Alon's Big Spring Refinery.
After weeks of deliberation, the Big Spring Economic Development Board voted unanimously to grant Permian Energy Partners, LLC a lease to develop approximately 300 acres of unimproved land situated in Howard County, which is owned by the economic develop corporation.
Permian Energy Partners had entered a bid in competition with Houston-based Frontier Resources for the same piece of land east of the Sid Richardson carbon black plant with the intent of developing it as a transport station.
Trains 100 cars long will export crude and gas produced to various refineries around the country.
The crude and/or gas will be exported instead of refined locally because as executive director of the EDC Terry Wegman explained, “Alon doesn't have room for more. They've got all they can handle.”
Although crude oil is the primary product extracted and collected, Permian Energy will also be processing natural gas.
PEP has already begun building infrastructure at the site and bringing in oil field equipment. In preparation for drilling and extraction, the rail cars will be bringing in frac sand, pipe and cement for area oil companies.
While both companies that submitted bids were well-suited for the area and were objectively scrutinized, “We could only choose one,” said Wegman, who continued by saying the EDC believes the best company was chosen for the project.
“PEP won the bid based on its superior term agreement and its intangibles,” said Wegman. “PEP came to us in December and we have been in negotiations with them since then. Frontier Logistics didn't come in until April. PEP has more experience and offered more to the community. That group is comprised of several very large companies with a lot of experience and expertise in their field.”
As for Frontier Logistics, it may have lost the bid, but the company plans to stay in the area for now, according to liaison Jeff Vidal.
“It left a bitter taste in our mouth, but we'll stay in the area and look at alternatives or other avenues for something else we can do,” he said.