North America - Oil Transport By Rail

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Re: North America - Oil Transport By Rail

Postby Gilbert B Norman » Sun Oct 28, 2018 12:24 pm

There is an article, front page no less, regarding Federal leases of land in Southeast Wyoming for exploration of shale oil in the region:

https://www.nytimes.com/2018/10/27/clim ... l-gas.html

Fair Use:

The parade of trailer trucks rolling through Jay Butler’s dusty ranch is a precursor to a new fracking boom on the vast federal lands of Wyoming and across the West.

Reversing a trend in the final years of the Obama presidency, the Trump administration is auctioning off millions of acres of drilling rights to oil and gas developers, a central component of the White House’s plan to work hand in glove with the industry to promote more domestic energy production.

Seeing growth and profit opportunities at a time of rising oil prices and a pro-business administration, big energy companies like Chesapeake Energy, Chevron, and Anschutz Exploration are seizing on the federal lands free-for-all, as they collectively buy up tens of thousands of acres of new leases and apply for thousands of permits to drill.


While I realize the political agenda is in conflict with many a reader of this material, the area has already been "built out" with adequate trackage to serve the Powder River coal source. In short, if environmental interests want to "rid the earth of coal", the track capacity is already there and that could hold pipeline interests at bay.

We shall see.
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Re: North America - Oil Transport By Rail

Postby Gilbert B Norman » Sun Feb 03, 2019 8:51 pm

First half of the Super Bowl has been "dull bowl", so I'm catching up on my newspsper reading.

I'm not sure "what to make of" this Wall Street Journal article:

https://www.wsj.com/articles/oil-trains ... mail_share

Fair Use:

..The use of trains to carry crude is surging after dropping in recent years amid concerns about safety, as drillers in parts of North America produce more oil than area pipelines can accommodate.

An average of 718,000 barrels of crude a day traversed America’s railways as of October, the latest data available, an 88% increase from a year earlier, according to the U.S. Energy Information Administration. That compares with a peak average of about 1.1 million barrels in October 2014.

Much of the recent oil train growth is due to record shipments from Canada, where pipeline expansion projects, including Keystone XL and Trans Mountain, have stalled amid environmental opposition and legal delays. Crude-by-rail shipments also have ticked up from North Dakota’s Bakken region and the Permian Basin of West Texas and New Mexico, according to energy-monitoring firm Genscape Inc..

The "tone" conveys to me that the shippers will think of rail as their last resort. The article has this theme "pipeline is cheaper", but I wish it contained more analysis regarding capital costs.

Sure, it's great to learn that "business is picking up", but how about some talk that shippers are prepared to cast their lots with the railroads.
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Re: North America - Oil Transport By Rail

Postby gokeefe » Sun Feb 03, 2019 9:06 pm

Pretty sure I caught the same article. 88% increase over last year and climbing towards record territory.

It doesn't seem to be a question of casting lots so much as "fast and flexible". I've also noticed that in general oil to rail terminals appear to be relatively simple facilities. Nothing complicated or expensive about them.

Even the new tank car mandates haven't killed this service.
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