February 27, 2018 / 9:53 PM / 20 days ago

UPDATE 1-Andeavor and Savage end joint Washington crude terminal project

(Adds details, background)

HOUSTON, Feb 27 (Reuters) - Independent U.S. refiner Andeavor and Savage Cos ended their effort to build a crude-by-rail-terminal at the Port of Vancouver, Washington, on Tuesday, Vancouver Energy, the joint venture set up by the companies to manage the project, said in a statement.

Vancouver Energy said it agreed to end its lease for space at the port a month early and was donating the March lease payment of $100,000 to charities in the Vancouver area.

The death-knell for the project was heard on Jan. 28 when Washington Governor Jay Inslee, a Democrat, approved a state board’s recommendation denying Andeavor a permit to build the rail-to-marine terminal, which was to transfer 11 million barrels of U.S. Midwest oil each month from trains to tankers at the Port of Vancouver.

Andeavor and Savage, a privately held transport and logistics company, touted the terminal as bringing jobs to southwest Washington and cleaner crude oil to the West Coast, but opponents in southwest Washington and northwest Oregon said the terminal increased the risk of oil spills and deadly explosions.

Opponents also said trains carrying crude oil along the Columbia River valley placed a key waterway in danger.

“It’s disappointing we won’t be able to provide the needed family-wage jobs and economic boost for the area that we had envisioned,” said Jared Larrabee, Vancouver Energy’s general manager.

In January, Andeavor said it booked a $40 million asset impairment charge in the fourth quarter of 2017 related to the project.

Inslee’s action was expected after the Washington Energy Facility Site Evaluation Council voted in late November to reject the project.

Andeavor and Savage began the push to build the terminal, expected to cost $210 million, in 2012 when West Coast refiners including Royal Dutch Shell Plc were looking to open rail terminals to bring cheaper oil from the U.S. shale fields to Pacific Coast refineries.

Reporting by Erwin Seba Editing by Leslie Adler

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