Calumet Shipping More Oil By Rail, Lake Superior

Another incredible North American energy story -- and at the end of the day, it's all about the Bakken.

The Dickinson Press is reporting:

In 2012, Calumet Superior LLC built a $10 million train-loading oil terminal across the street from its refinery on the south edge of Superior, adding 18,000 feet of new track.
Calumet now is loading about 5,000 barrels (210,000 gallons) of oil per day by rail, said refinery manager Kollin Schade.

“This was never intended to be a major part of our operations,” Schade said during a recent tour. “But if we have customers that have a need, we can help fill that.”

Calumet’s effort is part of a national trend spurred by oil production outpacing pipeline capacity. In 2008, 9,500 carloads of oil moved on major U.S. railroads. By 2013, that had risen to more than 400,000 carloads. Each car holds between 590 and 630 barrels of oil, about 25,000 gallons.

Nationwide, the increase in oil moving by rail has spurred increased problems, including derailments, oil spills and serious fires. More oil spilled from railroad cars in 2013 — 1.15 million gallons — than in the previous 37 years combined, according to the U.S. Pipeline and Hazardous Materials Safety Administration.

Calumet is the partner with MDU (50/50) building the new refinery west of Dickinson.

I believe that refinery should be operational by the end of the year (2014) -- conceived, approved, and built in less time than it took the US State Department to issue the recent environmental impact statement on the Keystone XL. And that's why North Dakotans don't want the Feds involved in approving oil and gas permits. There, now I've said it. For the umpteenth time.

By the way, back to the story at the top -- about Calumet shipping oil by rail: only rail has this flexibility; pipelines cannot do this -- turn on a dime, depending on the market.