With U.S. crude oil producing at record amounts and outstripping pipeline capacity, the country is relying heavily on railroads to move new crude oil to refineries and storage centers, reported the U.S. Energy Information Administration (EIA) Wednesday.
The total amount of crude oil and refined products being transported by rail is close to 356,000 carloads during the first half of 2013, up 48 percent from the same period last year, according to Association of American Railroads.
“U.S. weekly car loadings of crude oil and petroleum products averaged nearly 13,700 rail tankers during the January to June 2013 period. With one rail carload holding about 700 barrels, the amount of crude oil and petroleum products shipped by rail was equal to 1.37 million barrels per day during the first half of 2013, up from 927,000 barrels per day during the first six months of last year. Crude oil accounted for about half of the 2013 daily volumes," reported AAR.
"Increases in rail transportation multifactor productivity can be traced to technical progress, such as improved capital inputs and technological changes in the form of improved methods of service delivery. Improved technology for locomotives, freight cars, and track and structures have increased reliability and reduced maintenance needs," added the United States Department of Transportation.
A large portion of the produced crude oil is from North Dakota where there is not enough pipeline capacity to move supplies, therefore dependency on delivery of oil by rail is substantial. North Dakota currently ranks as the second largest oil producing state after Texas, reported EIA.Oil & Gas Journal is reporting:
Increased shipment of crude oil by rail is making the US Department of Transportation examine its tank car standards, and possibly could result in a proposal for new requirements by the yearend, an American Petroleum Institute official said.
Cindy Schild, API’s downstream operations senior manager for refining and oil sands, said the effort was under way before a runaway train carrying Bakken crude to a Canadian refinery derailed early on July 6 in Lac Megantic, Que., resulting in fires and explosions that killed at least 15 people and left another 60 people missing.
A spokesman for DOT’s Pipeline and Hazardous Materials Safety Administration confirmed that the agency is considering amendments to current regulations that would enhance rail safety, including for the DOT Specification 111 tank cars, and further clarify the regulations.
“This is a tragic incident, and we sympathize with all the losses there. It’s important to learn from such events,” Schild said. “DOT is evaluating new specifications for tank cars transporting combustibles including crude oil, and we will be working with them on it.”