Western Railroad Discussion > Another new Bakken oil loadout

With the downturn in oil traffic, here's some news that bucks the trend.  It's from the Yahoo North Dakota Railroading Group:

"BNSF recently operated the first crude train from the facility at East Fairview, ND (just east of, not surprisingly, Fairview, Montana on remnants of the Watford City branch), just over 100 cars for Philadelphia, PA and CSX delivery"

Fairview is on the BNSF Sidney Line Sub.  Routing could either go up to Snowden on the High Line or down to Mandan on the Forysth Sub.  There is a wye at Fairview allowing moves to go either way.

There was discussion about the 'new' loading facilities processing the Bakken crude to reduce the flammability, Any info if this facility is doing that?

TCnR Wrote:
-------------------------------------------------------
> There was discussion about the 'new' loading
> facilities processing the Bakken crude to reduce
> the flammability, Any info if this facility is
> doing that?

I don't have the info at hand, but there was discussion about facilities which would strip high volatility components out of Bakken crude oil. The feds published rules, and posted inspectors to enforce them.  There's a parallel directive which ends flaring off of natural gas liquids from crude, requiring those liquids be captured and removed.

Crude has a pretty bad name right now, removing that stuff 'should' help things out.

There was a transcript on the morning News from the Kentucky derailment of the First Responder radio conversations. There was confusion about the fire and a comment about crude oil in the tank cars. Then they said they needed to look up the car numbers.

TCnR Wrote:
-------------------------------------------------------
> Crude has a pretty bad name right now, removing
> that stuff 'should' help things out.

The problem is what to do with it once the NGL's (Natural Gas Liquids) are stripped out...no easy answers and producers are not crazy about having to spend the bucks to pay for transporting it by rail.  A new pipeline in the Bakken being built to take away NGL's will help but probably not enough.

This might help: 

DEFINITION of 'Natural Gas Liquids' - Components of natural gas that are separated from the gas state in the form of liquids. This separation occurs in a field facility or in a gas processing plant through absorption, condensation, adsorption or other method. Natural gas liquids as classified based on their vapor pressure:


Low = condensate
Intermediate = natural gas
High = liquefied petroleum gas

Read more: http://www.investopedia.com/terms/n/natural-gas-liquids.asp#ixzz3emPQGKEp


Allen
 



Edited 1 time(s). Last edit at 07/02/15 16:33 by bradleymckay.

I caught the first train from this loadout passing thru my hometown of Downers Grove IL this afternoon: U EFVCXP01

Slight typo in my message, the symbol was U EFVCXP0 01T

Agree about the NGL's. I read about it in general in The Economist, they said most pipelines refuse to handle crude until the NGL's have been removed as it corrodes the pipe (and welds) and contaminates any subsequent material through the pipline. The article/Author didn't understand why the RR's accepted it.

TCnR Wrote:
-------------------------------------------------------
> Agree about the NGL's. I read about it in general
> in The Economist, they said most pipelines refuse
> to handle crude until the NGL's have been removed
> as it corrodes the pipe (and welds) and
> contaminates any subsequent material through the
> pipline. The article/Author didn't understand why
> the RR's accepted it.

Mostly because the refineries were willing to pay a premium price to ship the stuff.  Bakken crude typically sells at a discount to the benchmark US oil price, partly because of the NGLs, etc.  So, even adding $11-$14 a barrel (about $8,000 per tank car), the stuff was cheaper than buying oil from overseas. That was meaningful when east coast refineries had limited access to pipelines.

Enbridge, the pipeline operator, received a waiver from the feds, allowing them to refuse crude which had excessive levels of hydrogen sulfide and other nasty stuff.  The railroads, other pipelines, and shippers, for some reason, never saw a need to seek a similar waiver.

In the Permian Basin of West Texas there is serious talk of transporting alot more condensate by rail than is currently taking place.  Both UP and BNSF are interested.  The reason is in quotes:

"Lightness of crude oil is largely determined by its API gravity (rating), a measure of how light or heavy it is compared to water. Typical WTI's (WTI = West Texas Intermediate crude oil) API gravity ranges from 38 to 40, while condensate is generally 45 to 80 or even higher. An ultra-light condensate's API is generally higher than 70. Too much very high-gravity condensate can exceed pipeline API gravity limits, but trains can move it. Rail provides a solution for high-gravity condensates," said Pat McGannon, vice president of Rangeland Energy, at the American Business Conferences of Crude Markets and Storage Summit in Houston.


Allen



Edited 2 time(s). Last edit at 07/02/15 19:09 by bradleymckay.

Condensate is greatly prized in Japan and Korea, among other (export) destinations.  And the Obama administration has allowed several "one off" condensate export deals already. One way to move the lightly refined crude, and certainly good for the railroads...

Too bad they didn't have to reopen the lift bridge and tunnel!

PrairieRailfan Wrote:
-------------------------------------------------------
> Slight typo in my message, the symbol was U
> EFVCXP0 01T

I'm still wondering:  did it go up to the High Line at Snowden or down the Sidney Line to Glendive?

Coalca Wrote:
-------------------------------------------------------
> Too bad they didn't have to reopen the lift bridge
> and tunnel!

Was this on the old GN or after the merger? where exactly?

This new loadout is on the old GN, west and southwest of Williston in Montana.

Here's what I'm curious about.  The producers don't want to take out all this extra
stuff to ship the cude, but from what I can tell from the information provided, this
is all stuff they can sell!  Can't they find buyers for it?  Seems odd to me.

Nick Tharalson,
Marion, IA

ntharalson Wrote:
-------------------------------------------------------
> This new loadout is on the old GN, west and
> southwest of Williston in Montana.
>
> Here's what I'm curious about.  The producers
> don't want to take out all this extra
> stuff to ship the cude, but from what I can tell
> from the information provided, this
> is all stuff they can sell!  Can't they find
> buyers for it?  Seems odd to me.
>
> Nick Tharalson,
> Marion, IA

Nick, the transportation costs to move it from the Bakken/Williston Basin to the Gulf Coast (primary export location) is the problem.  Producers are very unwilling to eat the extra transportation costs.   Very difficult for Bakken/Williston Basin producers to compete against NGL's from the Permian Basin and Eagle Ford shale locations in Texas...they have a logistical advantage.  IF the demand for condensate continues to increase this may change.

See here.  This NGL pipeline was completed but they want to expand it:

http://thebakken.com/articles/864/oneok-expands-gas-capacity-of-bakken-ngl-pipeline


Allen



 



Edited 2 time(s). Last edit at 07/03/15 19:37 by bradleymckay.