Kansas City Southern, Sasol Sign Agreement

Kansas City Southern subsidiary Kansas City Southern Railway Company (KCSR), has reached an agreement with Sasol Chemicals for the construction and long-term lease of a storage-in-transit (SIT) rail yard to support Sasol’s new ethane cracker and derivatives project in Lake Charles, La.

KCSR also will replace and expand its existing rail car classification yard in Mossville, La.

“We are very pleased to expand our relationship with Sasol by entering into this long-term lease agreement,” Patrick Ottensmeyer, president, Kansas City Southern, said in a June 8 statement. “In addition to serving Sasol’s needs in Lake Charles for many years to come, this investment will better position KCSR to serve the growing petrochemical industry and other customers in the Lake Charles area.”

Last October, Sasol finalized its investment decision on an $8.1 billion ethane cracker and derivatives complex in Louisiana. The project includes construction of an ethane cracker that will produce 1.5 million tons of ethylene annually. The complex also includes six chemical manufacturing plants.  An additional $800 million will be invested in infrastructure and utility improvements. According to Sasol, construction is underway on the project, and the company expects that the facility will be operational in 2018.