It looks like this company is looking to move a specific type of oil to refineries in Delaware and New Jersey from the Bakken shale in North Dakota and Southern Alberta.
From the description of the oil is $17 a barrel price difference enough to pay for rail vs ocean. The oil they were getting was from the North Sea and West Africa.
From what I can remember about pipeline setups their is not a competitive pipeline route. A combination of the product(high sulphur or sour) and refinery(a refinery designed for this product) puts this by rail.
I’ll admit I’m no great expert here. Any idea how long this will last? Also how much of a train is 180,000 barrels of oil?
There are US 42 gallons of oil/barrel. That is 7.56 million gallons of oil. Divide by 25,000 for an average tank car and you get 302 cars of oil to be shipped. This a light sweet crude and there is a market for it. Shipping it to refineries that serve the gulf coast is a problem as there is not enough pipeline capacity out of the Bakken area, and the refining capacity is at maximum. A lot of this oil has been shipped via rail to the east coast. Both BNSF and CP have an increasing number of trains with this oil headed to the Chicago area.
There is another oil shale area in Canada that has made the news because of resistance to a new oil pipeline across Nebraska. This oil has high sulfur rates, and is shipped to China. I suspect it would be too costly to clean it up to meet US emissions standards
I saw this on a Peoria transportation board, they are constructing an oil barge transload terminal at Hennepin on the Illinois River, at the end of the Kankakee Secondary on NS. Hennepin is where the Illinois River swing bridge used to be, a few miles from the BN interchange, but now the trains will need to go to Streator and then head west. The last time I crossed this line it had rust on it after the former J&L (later LTV and then Mittal) steel plant at Hennepin closed, but according to the story there is an ethanol plant there as well now so this will just add to the traffic.
Running a pipeline to the east coast would involve both the trunk line and distribution lines to the various coastal refineries in a densely populated area. Nevertheless, there are projects to expand pipeline capacity from the mid-west to the gulf coast. Competition may come in the form of tankers from there to the east coast refineries which are set up for boat delivery. Oil is such a volatile market.
JR, the latest tank cars for hauling Bakken Crude are nearly 31,800 gallon cars with 286k loaded weight. You can’t use these cars for some of the very heavy Crudes or the Bitumen that comes from the Canadian Tar Sands, but for the Light Bakken Crude and the even lighter Eagle Ford Crude out of Texas they are perfect.
I sorta ‘guessed’ at the capacity of the cars I saw rolling by. 25,000 gallons made it easy to calculate how many cars it might take to move the OP’s number of barrels of oil. There does appears to be some different capacity/type tank cars I have seen on both BNSF and CP along the Mississippi River. UP’s ‘frac’ sand train out of Winona seems to have more consistent cars in it(50’ gons).
I have been seeing a significant quantity of, mainly, 30,000 gallon tank cars placarded for crude oil (1267) on UP trains headed to and from Bakersfield. I wonder if that is Bakken crude oil that originated on CP.
Bakersfield on the old SP now UP. UP has been handling a tank train from around Paso Robles to Bakersfield for quite a number of years. It is a relative short haul that as a unit train just made a lot of sense. Rgds IGN
This is the first I have heard about anything like this. There used to be a crude oil unit train that ran from Bakersfield (railroad station of Saco) to Carson, CA. There is currently a crude oil unit train that runs from Wunpost (south of San Ardo, CA in southern Monterey County) to Carson.
Thanks. I wonder if Alon will consider doing this to refine at its plant in Bakersfield. It was a refinery and as far as I know can still refine crude oil. The last I heard they were shipping distillates to it from their refineries in the LA area for further processing.
Here is an interesting quote from the article. “Late last month, railroad watchers who share their observations on trainorders.com tracked the movement of a train carrying about 60 tankers of Bakken crude into Kern Oil & Refining. That amounts to more than 40,000 barrels of oil in a single shipment.”