(National Geographic – November 30, 2012) Oil Train Revival: Booming North Dakota Relies on Rail to Deliver Its Crude (by David LaGesse) for National Geographic News
http://news.nationalgeographic.com/news/energy/2012/11/121130-north-dakota-oil-trains/
North Dakota surpassed Alaska this year as the number two oil-producing state. It's thanks to fracking—the extraction of oil from the state's Bakken Shale formation. But all that oil would be stuck in the Midwest without trains. "Rail is cool again," said Rusty Braziel, an energy analyst at RBN Energy. U.S. railroads have seen the number of cars filled with petroleum products jump 44 percent in the past year. A large share of that traffic starts in North Dakota, where more oil is being transported by rail than by pipeline. That might be expected until more pipelines can be built. More surprising is that shipping by rail, which is costlier than pipeline transport and raises new environmental concerns, may become a fixture of the industry and not just a temporary fix, analysts say.
Rail also allows the oil producers to add and subtract shipping capacity—the number of train carloads—quickly, and to pick and choose the most lucrative markets. This summer, for instance, North Dakota producers shipping by rail could send their crude directly to the East Coast or Gulf Coast, where it sold at higher prices than if it had been transported by pipeline. The price for oil shipped by pipeline in the Midwest is depressed because too much crude is flowing into Cushing, Oklahoma, where pipelines converge. "There's been a real logjam in Cushing," said Braziel, of RBN Energy. "The darn thing about pipelines is they only go from one place to another. Railroads go just about anywhere."
