Zenith Energy, a crude oil company, transports over 200 million gallons of oil per year through its facility in Northwest Portland. Now, it's asking the city if it can expand its operation even more.
Environmental advocates say the City of Portland, which has promised to reduce carbon emissions by 80 percent by 2050, has an opportunity to stop the expansion and possibly shut down Zenith’s operations completely by not authorizing a land use document the facility needs to expand and operate. City officials, however, say they may be legally bound to greenlight Zenith’s expansion.
Zenith has been making waves in Portland since 2017, when the company acquired its facility from Arc Logistics, a fellow crude oil company, and immediately started ramping up its operation. When it was acquired, Zenith’s facility had space to unload 12 tanks of oil per day. Using permits granted to Arc Logistics, the company built three new railcar platforms and had enough infrastructure to unload 44 tanks of oil per day by the end of 2018. Each tank holds about 20,000 gallons of crude oil.
Since then, Zenith has been expanding its crude oil imports from Canada while simultaneously telling city officials that it was phasing out its oil transportation and moving towards diesel distribution. That lie, revealed in early 2019, has led to the city’s mistrust of the oil company—so much so that the city has directly cited that mistrust as a reason to reject some of Zenith’s other expansion requests. But this time, the city may not have that same option.
Zenith is currently requesting state permits to build two more railcar unloading platforms. In order for the energy company to receive the required permits from the Oregon Department of Environmental Quality (DEQ), Zenith first needs approval from the City of Portland on a new Land Use Compatibility Statement (LUCS)—a document that evaluates whether the proposed use of the facility is compatible with the city’s land use policies. The City is expected to make a decision on the LUCS sometime in August, but there isn’t a strict deadline.
If Portland leaders approve the LUCS, Zenith must then request an air permit from the Oregon DEQ before moving forward with construction. If the city rejects Zenith’s request for a LUCS authorization, the energy company would not be able to expand its terminal. The rejection of the LUCS—and thus rejection of an air permit—may also throw a wrench in Zenith’s ability to legally operate at all, because the company needs an air permit to continue transporting oil.
While city officials and environmental advocates agree that fossil fuel operations don’t fit with Portland’s vision of being a climate conscious city, the City says it may be in a legal bind to authorize the LUCS.
The city council passed an ordinance in 2016 banning new fossil fuel infrastructure in Portland. But, because of a timing loophole, Zenith’s terminal expansion is still allowed under that ban. The oil company’s current expansion request stems from a permit that its predecessor Arc Logistics applied for prior to the 2016 ordinance. The city has been legally bound to consider Zenith’s expansion request based on the city’s land use rules at the time the request was originally made.
But environmental advocates, who have long called on the city to shutter Zenith, say that this LUCS request gives the city an opportunity to reject Zenith’s operations. The LUCS authorization is different from a permit in that it allows the city to look at the company’s operations holistically and ask if Zenith is functioning in line with Portland’s current values, according to advocates.
Portland’s Bureau of Development Services, which is overseen by Commissioner Dan Ryan, is responsible for leading the city’s decision on the LUCS. In a written statement to the Mercury, a spokesperson for Ryan’s office said the City is reviewing Zenith’s LUCS in accordance with Oregon law.
“The City is committed to ensuring compatibility with the City’s Comprehensive Plan, including policies to reduce carbon emissions, increase climate resiliency, and keep Portlanders safe,” Ryan’s spokesperson Margaux Weeke wrote. Weeke said the City Council is currently exploring “all legal avenues related to this issue” and that the public should expect an update in July.
Denying Zenith’s LUCS runs the risk of Zenith launching a lawsuit against the city.
Environmental advocates say if Portland officials don’t take a stand and chance facing a lawsuit, they are setting a precedent for Zenith to continue to increase the amount of crude oil being transported through Portland.
During a “Stop Zenith” rally in Cully Park in early June, environmental advocates spoke to about 60 community members about the city’s pending decision.
“We know that the city is very scared of being sued by Zenith if they deny this LUCS,” said Nick Caleb, a lawyer with environmental advocacy group Breach Collective, during the event. “But here’s the thing: If after years of turning out to meetings, submitting comments, building the scientific record, and getting strong policy passed the City of Portland still isn’t willing to go to court to keep the fossil fuel industry from harming us, we’ve got a serious problem.”
According to Oregon DEQ records obtained by Columbia Riverkeeper, an environmental advocacy organization, Zenith Energy moved over 234.8 million gallons of crude oil through its Portland terminal in 2020—that’s a 67 million gallon increase from what the oil company transported in 2019. All of that crude oil isn’t used by Portland industries—rather, Zenith moves the oil through its terminal to then transport it to other states and countries.
The increase in oil moving through the Zenith facility concerns environmental advocates not just because of the diesel pollution associated with a higher volume of trains and the broader climate implications of facilitating the movement of fossil fuel, but also because of the increased risk of train derailment. The event in Cully Park was held on the fifth anniversary of a 16-tank-car oil train derailment in Mosier, Oregon, that sparked a massive fire and released 16,000 gallons of crude oil into the air.
Zenith’s trains run through the Cully neighborhood in North Portland. Cully Park, which is often busy with kids playing on the playground and neighbors socializing on the grass, would be in what the environmental advocates call the “blast zone” if one of the trains carrying Zenith’s crude oil derailed. While the community is concerned about the potential catastrophes, they are also sounding the alarm on the ever-increasing threat of climate change the fossil fuel industry contributes to.
“Even if another disaster never happens like what we saw in Mosier, this is still a disaster,” said Ryan Rittenhouse, a conservation organizer with Friends of the Columbia Gorge, during the event. “Even if Zenith operates perfectly as intended, it is still a disaster for our communities, our environment, and our ecosystem.”
While the city plans to provide updates to the public in July, environmental advocates are focused on organizing community events to make their position against the Zenith expansion known to city officials. On June 21, environmental groups like 350 PDX and Columbia Riverkeeper are leading a parade to City Hall to present city commissioners with signed petitions against Zenith’s operations. Columbia Riverkeeper is also leading an email campaign to keep community pressure on Commissioner Ryan’s office regarding the city’s LUCS decision.
“We are determined to make sure those decisions are made in the interest of public health and our shared environment,” said Kate Murphy of Columbia Riverkeeper. “It’s up to us to really make sure our city officials understand how we feel about it.”