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Tesoro Refining & Marketing Company LLC, a subsidiary of independent refiner Tesoro Corp. (TSO - Analyst Report) has formed a joint venture with supply system provider Savage Companies to build a port facility. The crude-by-rail unloading and marine loading facility will be located at the Port of Vancouver, Wash.

The Tesoro-Savage joint ventures’ new facility will have an initial capacity of 120,000 barrels per day (bpd) and can be expanded up to 280,000 bpd. The project will involve a total investment of approximately $75 million to $100 million and is expected to be operational in 2014. Both, Tesoro and Savage will also enter into a land lease agreement with the Port for an initial period of 10 years.

The unique location of the Port of Vancouver will help in the delivery of North American crude oil to West Coast refining centers. This joint venture will benefit Tesoro with sustainable revenues. It will also create construction and operation related jobs locally. The deal is subject to approvals by regulatory agencies and port commissioners.

Management at Tesoro believes that this new project will have an additional feedstock cost advantage to its other refineries in the West Coast.

Tesoro is expected to announce its first-quarter 2013 results on May 1. The Zacks Consensus Estimate for the to-be-reported quarter is a profit of 74 cents per unit on revenues of $7,171.0 million.

Tesoro currently retains a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next 1 to 3 months.

But there are certain other firms in the oil refining and marketing industry that are performing better and are worth considering at the current level. These include Lehigh Gas Partners LP (LGP - Snapshot Report), Global Partners LP (GLP - Snapshot Report) and Delek US Holdings Inc. (DK - Snapshot Report). All these stocks sport a Zacks Rank #2 (Buy).

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