Hearing on rail project proposed for Nipomo Mesa is postponed

County decides to revisit environmental impact report after receiving hundreds of public comments

clambert@thetribunenews.comApril 1, 2014 

After receiving a flood of comments about a proposed rail project at a Nipomo Mesa refinery, San Luis Obispo County officials have decided to postpone a Planning Commission hearing on it until later this year.

The county received about 800 comments on a draft environmental impact report on plans by Phillips 66 Co. to extend an existing rail spur so the refinery can receive up to five trains a week carrying rail-delivered crude oil.

As a result of some of those comments — and the specific questions they raised about potential impacts along the railroad’s main line outside San Luis Obispo County — the draft EIR will be revised and recirculated for public review, said Ellen Carroll, planning manager and environmental coordinator.

A Planning Commission hearing originally scheduled for April 24 has been pushed back to December.

Carroll couldn’t be reached for more information Tuesday, but a Phillips 66 spokesman said the county requested expanding the area the environmental impact study would evaluate.

The company would foot the bill for both the revised study and its recirculation.

“We remain committed to the proposal and obviously the safety of the project,” said Dennis Nuss, a senior adviser for Phillips 66. “We’re disappointed to see the process delayed but confident the revised (draft) EIR will help decision makers and the community understand the benefits of the project.”

The 1,780-acre refinery is off Highway 1 on the Nipomo Mesa.

The rail spur extension would add 1.3 miles of new rail as well as an above-ground pipeline and emergency access road.

Five parallel tracks would be built, each long enough to accommodate a train of 73 to 80 rail cars carrying about 2 million gallons of crude oil, according to the project description.

The refinery, which has operated since 1955, processes 44,000 barrels of oil a day, specializing in cheap, heavier crude oil from a variety of both onshore and offshore sources, mostly in Santa Barbara County, Phillips 66 employees said during a recent tour of the facility.

The refinery currently receives crude oil by underground pipe. The crude oil is refined into gas oil and a flammable oil called naphtha, which is piped to the company’s oil refinery in Rodeo in Contra Costa County, where it is refined into gasoline, diesel fuel and jet fuel.

The plant also produces petroleum coke and sulfur, which is sold and shipped out by rail car to be used in a variety of industrial processes.

But company officials expect supplies from the Central Coast oil fields will eventually drop off, and that the rail spur is necessary so that the company can replace that oil, site manager Jerry Stumbo and maintenance superintendent James Anderson said.

But the project faces significant opposition from local residents as well as some organizations, including local Sierra Club chapters, which argue that the environmental review only looked at the impacts of hauling crude oil in San Luis Obispo County and failed “to contemplate the risk involved in hauling crude oil in California via trains that will traverse some of the most challenging mountain passes in the U.S.”

Opponents point to derailments, explosions and fires including the disaster that killed 47 people and devastated the town of Lac-Mégantic, Quebec, in July, as well as the derailment and explosion of a train carrying crude oil in Casselton, N.D., in December.

They are also concerned about the type of oil that could be brought into the facility — specifically light, sweet crude oil from the Bakken region in North Dakota and Canada.

In January, the U.S. Pipeline and Hazardous Materials Safety Administration issued a safety alert that “recent derailments and fires indicate that the type of crude oil being transported from the Bakken region may be more flammable than traditional heavy oil.”

Phillips 66 officials said the refinery doesn’t have the type of process equipment necessary to refine significant quantities of light, sweet crude oil.

Stumbo said the facility could take some Bakken oil — maybe a train car now and then, which would be mixed with other heavier oil for processing.

The original draft EIR identified potentially significant impacts to visual aesthetics, air quality, noise, biological and cultural resources, transportation, and water and wastewater.

Phillips 66 has also received permission for a 10 percent increase in the capacity of the refinery, from 44,500 barrels a day to 48,900 barrels a day.

The Phillips 66 refinery employs about 135 full-time workers, residents of San Luis Obispo and Santa Barbara counties, with an average salary of about $100,000, company officials said. The company also works with 70 specialized contractors.

Tribune staff writer David Sneed contributed to this report. Reach Cynthia Lambert at 781-7929. Stay updated by following @SouthCountyBeat on Twitter.

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