Western Railroad Discussion > ND: Will an expanded Dakota Access pipeline mean hurt for rail?

Energy Transfer Partners, the owner of the Dakota Access pipeline, has announced plans to add more pumping stations along the now completed pipeline. The result will be a doubling of throughput, with crude oil flow of 1.1 million barrels per day by 2021.  That increase amounts to about seven unit oil trains daily.  (500,000 bpd / 700 barrels per unit train car. I've seen stenciling of 700-735 per car over the years)

The expansion doesn't require much new construction, and almost no new pipe and building permits. So, public uproar will likely be muted.  But the impact on rail companies could be signficant.  Various reports place the cost of shipping oil from the Bakken to NJ, eastern PA, or DE at $10.50 to $13 per barrel. That's double and a little bit more than comparable prices. If pipe was available.

If the government leaves well enough alone, a supply chain will tend to configure itself toward the lowest possible cost.  If it's cheaper to move the oil by pipe, then it's going to move by pipe.  No big surprise to anyone.  Of course, a lower delivered price for North Dakota oil should increase the demand for such oil.  This should increase the amount of drilling supplies brought in by rail and will dampen the adverse effects.  If the extra oil in the pipe is great enough it will just be more oil and rail movement will not suffer as much.

When this North Dakota oil boom was just starting I remember the BNSF forecasting that, in the end, they'd be moving about 25% of the oil.  At one time rail movement was up around 67%.  They knew pipelines would be built.  

 

My opinion is "not much". Most (not all) of the rail shipments are going west from the Bakken where the pipelines do not exist.

BB

bmarti7 Wrote:
-------------------------------------------------------
> My opinion is "not much". Most (not all) of the
> rail shipments are going west from the Bakken
> where the pipelines do not exist.
>
> BB

and the PES refinery in Philadelphia won't be receiving new shipments. 

NS delivers Bakken crude shipments to Conoco at Bayway / Linden NJ, and Delaware City DE.  Perhaps also to the Philadelphia area

Any info on how many bbls the PES plant in Philadelphia was consuming?

Hope they have slow creep throttles on those hi-speed pumps.

Lackawanna484 Wrote:
-------------------------------------------------------
snip
>
> The expansion doesn't require much new
> construction, and almost no new pipe and building
> permits. So, public uproar will likely be muted. 
> But the impact on rail companies could be
> signficant. 

I wouldn't bet on it, just depends if it reaches a certain awareness level.

Awareness Of Congresswoman.


Bob



Edited 1 time(s). Last edit at 06/26/19 15:57 by robj.

I read that the PES refinery was consuming 335,000 barrels per day; some by rail and some by ship.

But it did not take away all the production.  I saw a newspaper article saying that it still is processing about 100,000 barrels a day.

Lackawanna484 Wrote:
-------------------------------------------------------
> bmarti7 Wrote:
> --------------------------------------------------
> -----
> > My opinion is "not much". Most (not all) of the
> > rail shipments are going west from the Bakken
> > where the pipelines do not exist.
> >
> > BB
>
> and the PES refinery in Philadelphia won't be
> receiving new shipments. 
>
> NS delivers Bakken crude shipments to Conoco at
> Bayway / Linden NJ, and Delaware City DE. 
> Perhaps also to the Philadelphia area

CSX also delivers Bakken crude to Eddystone. Hopefully NS or CSX will start running Oil to Westville again as well (Westville just started getting new traffic in the past couple months)

Andrew Pine
,

tomstp Wrote:
-------------------------------------------------------
> But it did not take away all the production.  I saw a newspaper article saying that it still is processing about 100,000 barrels a day.

Later news articles say the owners plan to completely close the entire refinery.

Brian