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Permitting process under way for third crude oil shipping terminal

(Aaron Lavinsky | The Daily World)  The Puget Sound and Pacific Railroad line ends just before Paulson Road and would be extended to cross the road if the US Development facility is built.Buy Photo
(Aaron Lavinsky | The Daily World) The Puget Sound and Pacific Railroad line ends just before Paulson Road and would be extended to cross the road if the US Development facility is built.
U.S. Development Group An artist's rendering of the proposed U.S. Development oil transfer facility.
U.S. Development Group An artist's rendering of the proposed U.S. Development oil transfer facility.

Much of the Port of Grays Harbor’s Terminal 3 in Hoquiam has been sitting empty for decades, since Rayonier used the land to store logs from the mid-1970s through the mid-1990s.

But over the next two years, the vacant lot could be transformed into a massive oil storage facility, with U.S. Development Group planning to build an oil storage and shipping facility, which would be capable of handling an average of 689.85 million gallons of crude oil each year.

The U.S. Development project, which will be called Grays Harbor Rail Terminal, is the third crude-by-rail project proposed for Grays Harbor. The company filed a shorelines substantial development permit application with the City of Hoquiam and the state Department of Ecology earlier this week.

U.S. Development has a lease option on property at Terminal 3, but has not yet inked a lease for the land. The lease option has been open for a year, with U.S. Development paying $7,000 and $21,000 at various periods for the right to start an actual lease on the site once it gets all the requisite permits and insurance.

Westway Terminal Co. and Imperium Renewables applied for permits more than a year ago and are in the process of completing an Environmental Impact Statement.

Preliminary plans for the Grays Harbor Rail Terminal predicted that an average of 766.5 million gallons of crude oil would be handled at the facility each year, but the permit application states that the facility would handle 689.85 million gallons each year — 76.65 million gallons fewer than the previous prediction.

Charla Skaggs, a spokeswoman for U.S. Development, said the decrease doesn’t signify a smaller project, it’s just a better estimate for the planned facility.

“That number is just a more finely tuned estimate for how much oil will be handled,” Skaggs said.

The oil will be delivered by train and stored in between six to eight large storage tanks. The proposal includes a large rail car storage area on the northeastern corner of the lot. Hoquiam City Administrator Brian Shay said reviewing the application will take at least 30 days. After that, the city and Ecology will issue a determination of non-significance, a mitigated determination of non-significance or a determination of significance for the project’s environmental impacts.

If the agencies issue a determination of non-significance or a mitigated determination of non-significance, the Grays Harbor Rail Terminal will likely be awarded a shorelines substantial development permit, Shay said. But if Hoquiam and Ecology issue a determination of significance, the company will likely have to go through the lengthy and costly process of completing and Environmental Impact Statement.

Terminal 3, the proposed site of the Grays Harbor Rail Terminal, was most recently used as a log yard for the former Rayonier saw mill.

According to Polson Museum Director John Larson, the land was cleared during the mid-1970s when the company built the mill, which operated until the mid-1980s. Rayonier continued to used the property to store logs until the early 1990s.

The site is bordered by the Grays Harbor National Wildlife Refuge to the east, the City of Hoquiam’s wastewater treatment plant to the southwest and Willis Enterprises to the southeast. Hoquiam High School is located to the northeast, across State Route 109.

As part of the Grays Harbor Rail Terminal project, the Puget Sound & Pacific Railroad will extend the rail line past Paulson Road to allow trains to back into the facility. The railroad currently ends about 50 yards before reaching the road.


The City of Hoquiam, Ecology, Imperium and Westway recently began work on an Environmental Impact Statement to analyze the cumulative impacts of the three facilities. Shay said the agencies will begin accepting public comments online today.

Project information is available on Ecology’s website, and Links to submit scoping comments were expected to be available on those pages as of this morning.

Comments can also be sent by mail to Westway and Imperium Renewables Expansion Projects, 710 Second Ave., Suite 550, Seattle, WA 98104 and people can contribute comments orally at two public meetings.

An April 24 meeting will take place in the Hoquiam High School Commons and an April 29 meeting will take place in the Centralia High School Commons. Both meetings will run from 5 to 9 p.m.

A 6 p.m., April 23 town hall sponsored by the League of Women Voters at the Elma Grange will not be a formal scoping meeting, but Shay said staff will be present to explain the process and encourage those to submit public comment. The grange is located at 401 W Waldrip St. in Elma.

“I think we’re expecting as many as 20,000 comments,” Shay said. “I’m hoping that the people who take the time to comment will really pinpoint their concerns. People could certainly come up with concerns we’ll need to look into.”

Since filing the initial permit application, Westway has made a substantial increase in the maximum amount of oil it’s asking to handle every year. In its earlier permit application, the company gave a maximum of 403.2 million gallons per year. In new permit applications filed March 11 as part of the EIS process, the number jumped to 749.9 million gallons, an increase of about 346.7 million gallons every year.

Imperium has not changed its throughput estimates, and still lists its maximum as 1.26 billion gallons per year.