Oil by Rail: On the Rise?

With all of the political heat and opposition to the Keystone XL pipeline, it may be time to explore other modes of transportation for “Texas Tea” in the US and Canada.

In the article “Analysis: Crude-by-rail carves out long-term North American niche” by Nicole Mordant, the use of American and Canadian railways is explored.  Railroads are a great way to move many commodities across the continent, oil included.

Since 2007, oil shipments in the US have grown from around 11,000 barrels to over 300,000 barrels per day.  This growing trend, combined with the continued rise in inter-modal transportation should be great for the rail industry.

While transporting oil via rail can be four times as expensive as using pipelines, once the high fixed costs and political barriers that the implementing pipelines and carry are factored in, utilizing already-existing railroads sounds like an option worth pursuing.

Rail was the main choice of oil transportation before pipelines were around, and it appears that the industry may be heading back in the direction of its past.

Source:  http://www.reuters.com/article/2012/11/04/us-railways-oil-northamerica-idUSBRE8A30AX20121104

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s