Utah coalition selects Drexel Hamilton Infrastructure Partners to build Uinta Basin Railway

Written by Kyra Senese, managing editor
Uinta Basin Railway
Officials say crude oil extracted in the Uinta Basin, near the site of a new rail system, is essential to supporting national demand for fuel.

Utah’s Seven County Infrastructure Coalition board voted to select Drexel Hamilton Infrastructure Partners, LP for a public-private partnership to finance and build the proposed Uinta Basin Railway.

The new railway will bring about a line proposed by the coalition to connect the Uinta Basin’s various industries to the national rail network, according to a May 10 statement from the coalition.

“The railway will provide the long understood need for a cost-effective solution for additional transportation infrastructure in the Uinta Basin,” officials said in a statement.

Mike McKee, executive director of the Seven County Infrastructure Coalition, said he believes Drexel Hamilton brings a wealth of industry experience and valuable resources.

“We are excited to partner with them to advance the Uinta Basin Railway,” McKee said. “This is an important milestone for the project and shows our commitment to furthering the railway to drive economic development, enable sustainable communities and enrich the quality of life for residents throughout the state and region.”

Following the finalization of the public-private partnership through definitive agreements, Drexel Hamilton is expected to finance, develop and build the new Uinta Basin Railway. The company is also partnered with Rio Grande Pacific Corporation to operate and maintain the railway.

The coalition is set to continue in its current role as the public partner responsible for obtaining environmental clearance and authorization from the U.S. Surface Transportation Board. The Surface Transportation Board will oversee the National Environmental Policy Act process for the railway by preparing an environmental impact statement.

The Board also voted to approve a rail term sheet with the Ute Indian Tribe.

“The coalition and the tribe continue ongoing, positive discussions in an effort to take steps towards a formal partnership,” a statement said. “The Coalition appreciates the support that the Tribal natural resources offices and energy and minerals departments have provided thus far.”

Similar projects that Drexel Hamilton has successfully completed include acting as the developer of a $2.5 billion crude oil terminal complex called Plaquemines Liquid Terminal. The terminal is served by the New Orleans & Gulf Coast Railway, a shortline railroad owned by Rio Grande Pacific that operates about 700 miles of shortline and regional railroads in six midwestern and western states.

“We think the Uinta Basin is America’s most prolific stranded crude oil basin and deserves its place alongside the other great oil plays like the Permian and Bakken,” said Mark Michel, managing partner, Drexel Hamilton. “The Uinta is similar to Alberta oil reserves in Canada where transportation bottlenecks exist and have limited its ability to be refined in distant markets.”

Officials said the Uinta Basin Railway will provide economic stability to communities in the Uinta Basin by creating well-paying jobs and increasing opportunities for the Basin’s primary industries: mining, oil and gas, and agriculture and livestock.

The goods produced by these industries play a critical role in the U.S. economy, providing fuel for automobiles, plastics for medical supplies, and feed for livestock throughout the U.S., the coalition notes.

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