Hi-Crush Partners and ARB Midstream are to jointly develop and operate two energy rail hubs, one in the DJ Basin and one in the Permian Basin.
Union Pacific Railroad will serve both hubs. Hi-Crush will operate the frac sand terminals with the frac sand sourced from its mines in Wisconsin, and ARB will operate the crude-by-rail terminals.
“By establishing a presence in the DJ Basin and significantly expanding our presence in the Permian Basin, we are excited to further expand our extensive distribution network to better serve our customers’ in-basin needs,” said Robert E Rasmus, co-chief executive, Hi-Crush.
“We remain focused on delivering a low-cost solution to our customers and look forward to a successful partnership with ARB.”
“ARB is excited to partner with Hi-Crush on these projects,” said Adam Bedard, Chief Executive Officer of ARB. “Entering a long-term relationship with one of the leading providers of frac sand is complementary to our vision of growth providing integrated terminals to the oil and gas industry in North America.”
Hi-Crush and ARB are jointly developing Nicon, a 225-acre site in Weld County, Colorado in the heart of the DJ Basin. The frac sand infrastructure will include silo storage capacity, allowing Hi-Crush to accommodate unit trains.
The Permian Gateway energy rail hub is proposed on 300 acres in Howard County near Big Spring, TX. ARB has entered into a definitive agreement to purchase the acreage with the closing expected to occur in May, subject to customary closing conditions.
The frac sand infrastructure will include silo storage capacity, allowing Hi-Crush to accommodate unit trains. Hi-Crush and ARB expect the Permian Gateway energy rail hub to be commercially operational by early 2016.