Bakken Pipeline Analysis -- Update -- Oil & Gas Journal

Updates

March 3, 2014: the WSJ had an almost identical article. It seems I've read it before; I don't know. Regardless, here is the WSJ article -- rail trumps pipeline in North Dakota. 

Original Post

This is a very, very good analysis of the Bakken pipeline, sent in by a reader. It is at The Oil & Gas Journal and may require a log-in. If it does and you don't have a subscription, take a phrase and google it. It's a very, very good page to save to your computer for archival purposes if interested in this stuff. Some data points:

More than 760,000 b/d, or 71%, of Williston basin production is leaving North Dakota by rail. This number dipped slightly as the WTI-Brent spread narrowed, but the spread between North Dakota light sweet and Brent was still wide enough to warrant prudent crude-by-rail shipments.

The majority of crude oil moving by rail within the US and Canada is from the Bakken. EPRINC estimates that of the 1.4-million b/d of crude oil and petroleum products moving via rail in the US alone, roughly 900,000 b/d is crude oil. Of the 700,000 b/d of crude oil and petroleum product moving via rail in Canada, about 160,000 b/d is crude oil. Together, 1-million b/d of crude is moving via rail in the US and Canada, 780,000 b/d of which is Bakken crude.

An additional 100,000 b/d is likely moving from other plays within the US (the Niobrara and Anadarko formations). Roughly 160,000 b/d is moving out of Canada to refineries within Canada, along the US East Coast, and increasingly to the Gulf Coast. And roughly 600,000 b/d of ethanol bound for the gasoline supply is also moved via rail.

Canadian railroads have not moved as quickly as US railroads to accommodate growing, discounted production in their backyard. Origin terminals are being planned and rapidly built in Canada, but only a few sites are currently available to unload and process heavy bitumen via rail. The most likely method for shipping bitumen via rail would be heated cars, avoiding diluent or condensate use, each of which add cost. Without the diluent, however, proper unloading of the rail cars requires heating, which in turn requires the necessary infrastructure at the unloading facility.

The story includes several graphics and spreadsheets. A very good source, again, for those interested in this stuff.