Dakota Plains Facility Expansion Expected Online in December - Video

November 27, 2013 R.T. Dukes

Dakota Plains expects to commission an expansion of its Pioneer Terminal in New Town, ND, on December 18th.

When completed, throughput capacity at the rail terminal will increase from 30,000 b/d to 80,000 b/d. The facility will also have 180,000 barrels of storage.

The expansion couldn't come at a better time. The spread between WTI and Brent oil prices is at the highest point since March. A larger spread makes moving oil by rail more attractive.

“With price spreads and throughput volumes at their current high levels, and with our newly expanded Pioneer Terminal soon allowing higher throughput volumes, we believe we will be well-positioned for profitability as we move forward.”

— Mr. Craig McKenzie, CEO

Enbridge Completes Bakken Pipeline Expansion & Berthold Rail Facility

August 21, 2013 R.T. Dukes

Enbridge has completed the most recent Bakken Pipeline System expansion and opened its Berthold Rail Facility.

The Bakken Pipeline Expansion included two projects that added 145,000 b/d of pipeline capacity out of the Bakken region. The Berthold Rail Facility added 80,000 b/d of capacity and Enbridge now has the capacity to move 415,000 b/d out of North Dakota. That's a little more than half of the 820,000 b/d of oil produced in North Dakota.

“The completed Bakken Pipeline Expansion and Berthold Rail Facility are now providing options that are sorely needed. Combine these finished projects with the upcoming capacity within the Sandpiper Pipeline, and Enbridge will have the ability to move 660,000 barrels per day from the Bakken by early 2015.”

Enbridge partnered with the Berthold Farmers Elevator to construct the new rail facility and the facility has been in service since the second quarter of this year.

The company is also holding open houses in North Dakota, Minnesota, and Wisconsin this week related to the path of the proposed Sandpiper Pipeline Project. The pipeline will add 225,000 b/d of capacity out of the basin and has an expected in service of late 2014 or early 2015.

Derailed Train In Canada Was Carrying Bakken Oil

July 9, 2013 R.T. Dukes

A train carrying Bakken oil crashed in Lac Megantic, Quebec. The train was pulling 72 car loads or approximately 50,000 barrels of oil when it lost control. The train was making its way through Canada in route to a refinery in New Brunswick. An investigation will ensue, but initial reports make it sound as if the air brake was engaged and someone shut down the engine. From there, the train rolled out of control almost seven miles before derailing in Lac Megantic. We've included a video report below:

The death toll now stands at 13, with 50 people still missing.

It's a horrible tragedy and I believe we owe it to ourselves to ask the question whether or not it should be as difficult as it is to build pipelines in the U.S.

Bakken Oil Moving Back To Pipelines As Differentials Narrow

May 29, 2013 R.T. Dukes

Our friends at RBN Energy published an article this morning that notes pipeline flows have increased in May.

The increase in volume is likely the direct result of more narrow differentials on the East and West Coasts.

Enbridge's North Dakota pipeline system has been moving almost 50,000 b/d more than it has for most of the year.

Louisiana Light Sweet and Brent crude are both trading at premiums of less than $10 to WTI. That's after trading at premiums of ~$15 or more earlier in the year. Losing the differential means less can be gained by railing to areas not connected to pipelines.

Read the full article at rbnenergy.com

Rail Is Here To Stay In The Bakken - Bentek

May 15, 2013 R.T. Dukes

Moving crude oil by rail is here to stay for the foreseeable future. That was the message delivered multiple times at Bentek's annual Benposium conference in Houston.

Wide spreads in WTI and waterborne oil prices have made rail receipts attractive on the East and West Coasts. Once oil is committed to rail, it's there to stay.

"When barrels are committed to rail terminals, rail wins" state Rusty Braziel of RBN Energy at Bentek's Benposium conference.

Well, at least for some period oil will utilize rail. Many rail terminals have very short paybacks that make developing the facilities attractive even if they are only utilized for 1-2 years.

Over 50% of the crude oil produced from the Bakken is being moved by rail and all indications point to that being the case for some time. Prices are better at rail delivery points. The Gulf Coast is seeing growing production from the Eagle Ford and Permian, which only puts more pressure on prices to the South.

“Over time oil will begin moving back onto pipes, but its going to be a fight. Pipelines will always be the most efficient way to move crude, but they’ll have to be competitive on pricing and be able to deliver crude into competitive markets. ”

It's not surprising, but Bentek also noted that Bakken production has grown twice as fast as anyone thought in 2011. Current production is approximately what analyst were predicting for 2016. The play is just three years ahead of schedule!

Bentek's Benposium conference is held in Houston each Spring.