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Construction of a new black oil terminal on the Houston Ship Channel is expected to commence during the third quarter of 2011.

The new facility will be developed by new business venture Battleground Oil Specialty Terminal Co. (Bostco), a company established by John McDonald, the founder of Houston Fuel Oil Terminal - the country's largest handler of heavy refining byproducts covering 310-acres of storage tanks and terminals.

McDonald established Houston Fuel Oil Terminal thirty years ago and later sold his stake in the company over time, but acted as an adviser until about four years ago. He now plans for his new venture to compete with his former company in the niche market of black oil.

Referred to as a 'next generation black oil terminal' on the Houston Ship Channel, the Bostco facility will handle residual fuel oil, slurry oil, blendstocks, vacuum gas oil and crude oil.

The terminal will provide two deepwater (45+2) ship docks, twelve barge spots, twelve rail spots, pipeline connections for crude and 7.8 million barrels of storage.

Bostco says that future development will allow for two additional deepwater ship docks, eight additional barge spots and 2.5 million barrels of additional storage and pipeline connections for other petroleum products.

During the past twelve months, Bostco has acquired the land, completed preliminary design of the facility, applied for permits and discussed the project with all regulatory agencies.

Bostco plans to start construction in the third quarter of 2011 and be operational by spring of 2013.

"Bostco has significant commitments for storage and, as a new modern facility, will provide a value proposition unmatched in the Gulf Coast," the company said in a statement.