Sacramento Plans to Relocate Four Oil Terminals; Shell Sells

2017-05-09 01:28:26 EDT
Sacramento Plans to Relocate Four Oil Terminals; Shell Sells

The Port of West Sacramento in California will buy from Shell Oil Products U.S.
Shell's petroleum tank farm facility in Pioneer Bluff, according to the City of
West Sacramento.

The Pioneer Bluff District on the Sacramento River has been earmarked for de-
industrialization, and the future plan for that industrial area, which is
currently home to four oil terminals, includes real estate community
development and riverfront mix use.

A city official told OPIS on Tuesday that besides Shell, the other three oil
terminals at Pioneer Bluff belong to Buckeye, Chevron and ConocoPhillips. There
are two terminals in West Sacramento, and the other two are in Sacramento.

So far, there are no active negotiations with Buckeye, Chevron and
ConocoPhillips to decommission and relocate their terminals, he said. However,
the cities of West Sacramento and Sacramento are planning to relocate these oil
terminals and clean up that area in the future, but no dates have been set for
these three terminals.

The City of West Sacramento said that "the deal outlines a creative public-
private transaction which will allow Shell to phase out operations at the
facility within the next 4 years, by March 2021."

A Shell spokesman told OPIS on Tuesday that "Shell continually reviews and
actively manages its portfolio, and frequently considers a wide range of
opportunities. This is an ongoing process to help ensure we have the right mix
of assets to produce value for our shareholders and deliver our business
strategy."

Shell does not comment on the specifics of commercial transactions.

West Sacramento Mayor Christopher Cabaldon said, "This transaction is the next
and biggest step forward so far in the planned de-industrialization of West
Sacramento's Pioneer Bluff District."

"The Shell facility is one of four fuel terminals on both sides of the river
which have been viewed as immovable obstacles to taking back this stretch of
the waterfront to make a spectacular new district for life along the river.
Building on the momentum of exciting placemaking in the Washington area and The
Bridge District, as well as miles of trails along the riverbank, the agreement
demonstrates West Sacramento's resolve and leadership in creating great
attractions and neighborhoods worthy of our region's central natural asset."

The demolition and clean-up of the six-acre Shell facility, which has been in
operation since the 1940s, sends another strong signal to the real estate
development community that the transition of the Pioneer Bluff district from
legacy industrial operations to future riverfront mixed-use development
continues to move forward, according to the City of West Sacramento.

This latest agreement with Shell follows the relocation of the Cemex facility
to the Port's ship channel in 2008, and is an important first step toward
relocation of all the fuel terminal facilities on the Sacramento River to more
appropriate industrial locations in the region, said Yolo County Supervisor and
Port Commission Chair Oscar Villegas.

The agreement provides a framework for Shell to phase out operations and to
clean up all contamination on the property under the supervision of the
Regional Water Quality Control Board.

It also secures a strategic parcel which is located at the crux of future
traffic and bike/pedestrian infrastructure.

--Edgar Ang, eang@opisnet.com


Copyright, Oil Price Information Service