Posted on 09/23/2014 1:05:22 PM PDT by thackney
In May 2008, a locomotive with a grizzly bear painted on its side pulled into a railroad siding next to an abandoned grain elevator in the ghost town of Dore, N.D. The engine, property of the Yellowstone Valley Railroad, hitched up a couple of tank cars of crude from nearby oil wells and set off on a thousand-mile journey to Oklahoma.
Dore would never be the same—and neither would the U.S. energy industry. Until then, most oil pumped in North America moved around the continent in pipelines. Suddenly, and just as the oil industry began a period of unprecedented growth, there was an alternative: "crude by rail."
Today, 1.6 million barrels of oil a day are riding the rails, close to 20% of the total pumped in the U.S., according to the Energy Information Administration, chugging across plains and over bridges, rumbling through cities and towns on their way to refineries on the coasts and along the Gulf of Mexico. If all the railcars loaded with crude on one day were hitched to a single locomotive, the resulting train would be about 29 miles long.
Initially conceived of as a stopgap measure until pipelines could be constructed, and plagued by high-profile safety problems, crude by rail has nevertheless become a permanent part of the nation's energy infrastructure, experts say. Even pipeline companies have jumped into the rail business, building terminals to load and unload crude.
Behind the new industry are powerful economics. While it costs a bit more to ship petroleum on trains than through pipelines, railroads have the flexibility to deliver it to wherever it will fetch the highest prices. And capital expenses are far lower. Major railroads' revenue for hauling crude has jumped from $25.8 million in 2008 to $2.15 billion in 2013, according to federal data.
(Excerpt) Read more at online.wsj.com ...
ping,
Found this one searching for the Permian Rail Articles.
Dore was pretty small, but not a ghost town.
There was a scattering of towns along the rail lines, about a day's wagon ride apart. Some flourished, some faded, and a few are true ghost towns. Dore also had the highway running from Trenton, ND to Fairview, (or Williston, ND to Sidney, MT) so it wasn't as isolated as some of the small railroad towns that died out.
Now, though things are booming...
It was the first of the rail oil loading terminals in the area.
Ping. This article could easily be about the Phoenix-Durango Railroad.
This is what Third World nations do and since we have a third world Presidente it all makes sense.
A first world nation builds a pipeline ASAP! North to South.
Hope there’s no long tunnels on the way to the refineries.....................
Thanks for the ping.
I can see why the railroads (Warren Buffett) would oppose Keystone XL. They are cashing in. But despite the increase in rail capacity, it’s still not as efficient, safe or cheap as pipelines.
Is there a reason why shipment on the Mississippi River is not being utilized?...........
There is crude moving on the Mississippi River.
https://rbnenergy.com/rock-the-boat-don-t-rock-the-boat-the-inland-crude-tank-barge-fleet
https://rbnenergy.com/good-year-for-the-barges-part-2
https://rbnenergy.com/float-float-on-crude-oil-barge-volumes-continue-to-surge
Warren Buffett Buys Stake in Pipeline Company on Same Day as North Dakota Oil Train Explosion ...
http://www.huffingtonpost.com/steve-horn/warren-buffett-buys-stake_b_4534613.html
A shrewd businessman knows when the fix is in.
Or the Great Lakes? The only ports I'm seeing are in Chicago and a couple on Lake Erie. I'm wondering why Duluth/Superior isn't a major hub, since its port is well known among Lake sailors, and it's relatively close to both the Canadian and North Dakota fields. Granted, winters can be daunting on Superior, but it would seem hard to beat for a fair-weather port.
It appears that certain facilities exist to unload the tanker cars onto barges via manifolds. I assume that is a huge pipe/valve assembly alongside a side-track where 50 or so cars can be bottom drained at the same time.
Then it is pumped into storage tanks or onto a barge.
Is that about right?
They typically drain or load 10 or 12 cars at a time, then pull the train forward for the next dozen cars.
http://www.freerepublic.com/focus/f-news/3207045/posts
The above link shows the “unforeseen consequences” of not building a pipeline. Food grain left to rot in storage due to not enough trains to get it to market.
I’m not so sure it is unforeseen either. Lots of attacks on the food markets.
Destroying dams/irrigation.
Preventing using water due to “endangered” species.
Using cropland to grow corn for fuel.
And now increased pressure on trains.
I wonder why they couldn’t build a mega-manifold yard facility at a pipeline terminal and just run the trains shorter distances.
Thanks for the ping.
and then there was Lac Megantic
Typically there would be large tanks at the site. They would rarely plan to go directly from the rail to the barge as scheduling becomes a bigger problem and any other problems on one delays the other. You want both to keep moving product in or out while they are there. Large tanks acts as a buffer to prevent holding up the traffic.
Indigo Resources Ltd Plans Rail-To-Barge Crude Oil And Petroleum Terminal In Osceola, Arkansas
http://www.areadevelopment.com/newsItems/4-8-2013/indigo-resources-oil-terminal-facility-osceola-arkansas347848.shtml
Crude-by-Barge
http://www.maritime-executive.com/magazine/CrudebyBarge-2013-10-15
Now there’s crude-by-barge – another business, like crude-by-rail, that basically didn’t exist two years ago. And it’s all because of the shale oil boom, which has added two million barrels a day of new production in just the last two years. That new production initially overwhelmed the existing infrastructure of pipelines and terminals, and producers had a hard time getting their output to refiners. Crude-by-rail helped alleviate the bottleneck, but crude-by-barge was the vital missing link.
It began on the inland waterways. About a year ago Houston-based Kirby Corp. (NYSE: KEX) announced that it had begun barging Bakken crude from St. Louis down the Mississippi to refineries in Baton Rouge and downstate Louisiana. The crude arrived in St. Louis by unit train and was offloaded there onto Kirby barges. The company had transported Canadian tar sands from St. Louis before, but this was the first shipment of Bakken crude.
Kirby, of course, is the nation’s largest tank barge operator with more than 25 percent of the inland fleet of 3,100. American Commercial Lines of Jeffersonville, Indiana is a distant second with about 10 percent of the market. You can buy Kirby stock. You can’t buy ACL, which is a private company, like most of the major barge operators, including Canal Barge (#3), Ingram (#5) and Florida Marine (#6). You can also buy #7 Enterprise Products Partners (NYSE: EPD), a Houston-based midstream energy company. Enterprise is not just tank barges – it operates pipelines, storage terminals, natural gas processing facilities and more and, as its name indicates, offers all the benefits of a master limited partnership, including an attractive dividend.
While there’s nothing new about tank barge movements on the inland waterways, what is new is the cargo. Tank barges traditionally carry petrochemicals and natural gas feedstocks to the nation’s chemical plants, or else bottom-of-the-barrel stuff like asphalt and tar for road work and construction. Transporting crude oil is new, and it’s safe to say that crude-by-barge was made possible by crude-by-rail.
The economics are compelling. A typical 30,000-barrel tank barge can carry the equivalent of 45 rail tank cars at about one-third the cost. Compared to a pipeline, barges are cheaper by 20-35 percent, depending on the route. And for barge operators, it’s a win-win: They can transport crude oil down the Mississippi to Gulf Coast refineries and haul refined products back up the river to chemical plants and other end-users.
The Mississippi and its tributaries are not the only beneficiary of the rail-barge connection. Canadian Pacific (NYSE: CP) is moving Bakken crude by rail to Albany, New York, where it is transferred onto barges for transit down the Hudson River to the Phillips 66 refinery in Bayway, New Jersey. Current capacity: 160,000 barrels per day.
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