Bakken Oil Being Shipped To California -- A Great Story To Start Off The Week

Link here to Bakersfield.com.This story is huge, and immensely enjoyable to read. The data points do not do the story justice.

Data points:

• Kern County (Bakersfield, heart of California oil country) refinery buying "large amounts" of Bakken oil
• 26,000 bbl/day refinery
• Kern Oil & Refining Co
• turns a bigger profit refining Bakken oil than using same grade of oil produced in Kern County
• the site says the shift appears to have begun in 2010
• California's 2-million bbl/day refining industry needs more oil than California able to produce
• due to pipeline issues, there is a relative "glut" of Bakken oil
• $20 differential between Bakken and Kern oil
• experts estimate rail costs no more than $18; maybe less than $15/bbl

The article has much more information and some nice links embedded.

What a great way to start the week.

A huge thank you to a reader for alerting me to the story. 

Other refiners across the country are considering the same thing. The "genius" of all that unit trains and crude-by-rail terminals in North Dakota -- as someone else said, "necessity if the mother of innovation."

One small point might need clarification for the experts: early in the article the writer suggests that Bakken oil and Kern County oil are similar grades, but later in the story the writer refers to Kern County oil as "heavy" oil. If accurate, it is less expensive to refine Bakken oil than heavy oil, all things being equal.