Another ethanol company is coming to Selma’s petroleum hub.
Archer Daniels Midland, a food-processing and commodities-trading corporation, announced in December its plan to construct a rail facility and ethanol offloading system in Selma.
The company expects to complete the project by the end of 2016, according to a news release. However, Selma Town Manager Jon Barlow said the company has yet to get a permit for the project.
Archer Daniels Midland will partner with Kinder Morgan Inc., the largest energy-infrastructure company in North America. Kinder Morgan will build the offloading facilities at Bailey Feed Mill. The operations will have the capacity to bring in up to 96 tanker cars every 24 hours, according to the news release.
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Kinder Morgan will also build a 2.6-mile pipeline to connect the offload system at Bailey Feed Mill to its tanks at the Selma oil terminals. This will allow Kinder Morgan to blend ethanol at the terminals.
“This project will help us improve the efficiency of our ethanol delivery in this market with added unload capacity, quick-turn time on rail cars and a pipeline connection to tankage,” Craig Willis, president of ethanol for Archer Daniels Midland, said in a news release.
“And by working with Kinder Morgan and Bailey Feed Mill on this project, we will achieve the benefits in a cost-and capital-efficient manner,” Willis said. “Archer Daniels Midland has been a long-time supplier in this market, and we are excited to work with Kinder Morgan and Bailey Feed Mill to bring a more flexible, reliable and efficient solution to customers in the Selma area.”
David Halphen, vice president of business development for Kinder Morgan’s Products Pipelines, called the partnership a transportation solution.
“This project will reduce the ethanol-delivery carbon footprint through a more efficient use of rail capacity and pipeline transportation,” he said.
Archer Daniels Midland is the second ethanol company to announce construction in Selma in the past two months.
In November, Eco-Energy Distribution Services, a biofuel-supply company, announced its plan to start construction at the oil terminals.
The company has entered into a service agreement with Marathon Petroleum Co., which will upgrade its terminal to receive, store and load biofuels. It will also bring the ethanol in by rail car and pipe it to the blending stations at the oil terminals.
Barlow said Selma’s petroleum hub has been mixing ethanol for a while, but these companies will provide a larger capacity for blending.
“We have a very large tank farm here. It’s a great location, and it’s growing,” he said. “Ethanol is apparently a growing market within the petroleum industry. It just makes sense to expand the capacity.”
Piping ethanol will also be safer and take a number of big tanker trucks off the highways, Barlow added.