Daily Blog

Crude Loves Rocking Rail – Plains, Enbridge and Global Terminals in the Bakken

North Dakota Bakken crude production continues to grow at record rates with nearly 770 Mb/d produced in December 2012 up 40 percent since January 2012. The North Dakota Pipeline Authority estimates that 64 percent of that crude was transported to market by rail in December. After local refinery consumption (80 Mb/d) that means 440 Mb/d moving by rail. Today we continue our survey of North Dakota crude rail loading terminals with an in-depth look at three midstream companies that between them can potentialy load 280 Mb/d of crude in North Dakota.

The first episode in this series provided an introduction and overview of the “Year of the Tank Car” (see Crude Loves Rocking Rail). We described the rapid growth in US crude oil production that pressured pipeline logistics and made rail a viable alternative for taking crude to market. The second installment (see Crude Loves Rocking Rail – The Bakken Terminals) began our survey of rail loading terminals with a map and a complete list of facilities in North Dakota.

In the previous episode to this we began a more detailed review of the Bakken terminals with a look at EOG, Hess and Inergy (see Crude Loves Rocking Rail – EOG, Hess and Inergy) and today we turn the spotlight onto Plains, Enbridge and Global. As you read this series you will probably find it useful to refer back to the map and table listing of terminals that we provided previously (click here to download a PDF copy of the map – let us know at info@rbnenergy.com if you have trouble). The three companies that we are reviewing today are midstream merchant terminal operators that provide various crude loading/unloading storage and transport destinations to Bakken shippers.


Plains All American (PAA) and its predecessor the Canadian logistics company CANPET have been involved in NGL rail transport since the late 1980’s. Between 2002 and 2012 PAA expanded their North American NGL rail business to include 19 NGL rail load/unload facilities. In 2011 PAA began shipping Bakken crude in manifest loads from the Manitou terminal at Ross, ND (Montrail County). During 2012 they built out a unit train loading facility at Manitou (cost $40 MM) that went into service in November and can load 65 Mb/d. The terminal has two 150 MBbl storage tanks. The Manitou rail terminal is linked to a PAA crude gathering system in Stanley. The PAA Bakken infrastructure also includes a gas processing plant at Manitou and the rail terminal is used to ship NGLs as well. PAA also recently completed the Bakken North “Nelson” pipeline from Trenton, ND (about 65 miles west of Manitou) northwest to the Wascana Pipeline. The pipeline provides 50 Mb/d crude takeaway capacity to Saskatchewan where it connects with the Enbridge mainline to Clearbrook, MN.

In December 2012 PAA paid $500 MM to acquire the assets of US Development Group (USDG) - including three crude oil rail loading terminals located in the Eagle Ford, Bakken and Niobrara producing regions with an aggregate daily loading capacity of approximately 85 Mb/d, a rail unloading terminal at St. James, Louisiana with capacity of approximately 140 Mb/d and a project to construct a crude oil unloading terminal near Bakersfield, California. The North Dakota rail loading facility that PAA acquired from USDG is the Van Hook terminal (Montrail County) that currently handles 35 Mb/d but will expand to handle unit trains and 65 Mb/d in 2H 2013. Van Hook has two 90 MBbl storage tanks. The Van Hook terminal is on the Canadian Pacific (CP) rail network and the PAA Manitou terminal is on the BNSF network.

PAA’s strategic acquisition of the USDG rail terminal assets puts the company in a strong position to provide multi level services for Bakken oil producers. The table below from a December 2012 PAA investor presentation lists the company’s rail loading and unloading terminals in North America as well as expansion plans. By the end of 2013 PAA will have 265 Mb/d of takeaway rail loading capacity from the Bakken, Eagle Ford and Niobrara production basins. The PAA 140 Mb/d rail unloading facility at St. James is fully operational (see Plains, Trains and Diluent Deals) and the Yorktown, PA facility is expected online by the end of June 2013 with 130 Mb/d of rail unloading capability. PAA has an agreement with CSX to move crude by rail into Yorktown that is located on the Chesapeake Bay on the former site of Western Refinery and will include waterborne loading facilities. PAA is also developing a destination rail terminal at Bakersfield, CA to be completed in 2014. By the end of 2013 PAA will have approximately 6,700 rail tank cars under lease split about 50/50 between NGL and crude.

Source: Plains Investor Presentation (Click to Enlarge)


Enbridge has the largest pipeline takeaway capacity in North Dakota with a number of gathering systems feeding into the Enbridge North Dakota Pipeline (ENDP) that moves barrels into the Enbridge Mainline crude pipeline at Clearbrook, MN. Enbridge has a number of projects currently underway to expand access for North Dakota crude to its pipeline system including the Bakken Pipeline Expansion project that will run from Berthold, ND to Cromer (where it joins the Enbridge Mainline) as well as the Bakken Access Program of enhancements and expansions of the crude gathering systems that feed the ENDP. Enbridge is also discussing the Sandpiper project with shippers and regulators - a proposed new 200 Mb/d pipeline from Sanish, ND to Clearbrook and Superior, WS.  As a complement to these projects Enbridge is also building a rail loading terminal at Berthold, ND to offer shippers the flexibility to load barrels from pipeline and truck gathering systems onto rail cars. The Berthold facility is an interesting defensive development by Enbridge and reflects how important rail options have become to shippers in North Dakota.

The $145 MM Berthold Station Expansion Project will offer takeaway capacity on the BNSF rail network by early 2013. The project has two phases. Phase 1 is already complete and allows trucks to deliver 10 Mb/d directly into rail cars. Phase 2 will be completed in the first quarter of 2013 and includes construction of a double-loop track and unit-train facility and 2 X 150 MBbl crude oil storage tanks. Phase 2 allows for the staging of three unit-trains at a time that can load up to 80 Mb/d. The parallel Bakken Access project will enhance Enbridge gathering assets including a 40 Mb/d pipeline connection to EOG’s Stanley terminal (see Previous Episode).

Enbridge further demonstrated the company’s embrace of rail by crude options in November 2012 by announcing that its U.S. subsidiary, Enbridge Rail (Philadelphia) L.L.C., has entered into an agreement with Canopy Prospecting Inc. to create the Eddystone Rail Company that will develop a unit-train facility and related local pipeline infrastructure near Philadelphia, Pennsylvania to deliver Bakken and other light sweet crude oil to Philadelphia area refineries. The Eddystone terminal will unload 80 Mb/d by 3Q 2013 for subsequent transport by barge or pipeline to East Coast refineries. There is an option to expand unloading capacity to 160 Mb/d by 2014. Enbridge will own 75 percent of the joint venture and serve as operator of the facility. The estimated project cost is $68 MM. The facility will accommodate 120 car unit-trains and includes 200 MBbl of storage and a barge loading facility. Additional storage and pipelines connecting Eddystone to Philadelphia area refineries are also under development.

Global Partners LP

Global Partners LP owns and operates one of the largest refined product terminal networks in the Northeast US. The company is expanding into crude oil logistics including gathering, storage, transportation and marketing. In October 2011 Global began transporting crude by rail from North Dakota to the company’s Albany, NY terminal for trans shipment to barges for delivery to East Coast refiners. In August 2012 Global completed a 100 Mb/d crude rail storage facility at the Basin Transload Stampede ND rail loading facility. In October 2012 Global acquired a 60 percent interest in Basin Transload including the Stampede terminal and the Zap rail loading terminal at Beulah, ND. (see map below). The Stampede terminal at Columbus, ND (Burke County) is on the CP railroad. Stampede can load 120 car trains at present at a rate of 80 Mb/d. The terminal will have a link to the Tesoro Pipeline in 2013. The major advantage of the Stampede terminal is the direct “single-haul” trip to Albany, NY that takes 10 days round trip. The Zap terminal (Mercer County) is on the north segment of the BNSF railroad and can accommodate 120 car unit trains. The Zap terminal can load 60 Mb/d and Global is constructing a 140 MBbl storage facility. The BNSF railroad allows Global to ship to West Coast destinations.

Source: Global Partners LP Presentation (Click to Enlarge) 

Global has invested heavily in the company’s Albany, NY rail terminal that can now unload up to 160 Mb/d of crude. In January 2013 the company said that current throughput was averaging 100 Mb/d. Crude is delivered by rail on CP from the Bakken then offloaded into storage (as needed) and onto barges for the trip down the Hudson River to New York Harbor and refineries along the US East Coast. The refineries currently receiving crude this way are in New Jersey and Philadelphia. In January 2013 Global signed a 5 year take or pay contract with Phillips 66 to deliver 50 Mb/d of crude to the Linden, NJ Bayway refinery.

In January 2013 Global also purchased a West Coast crude oil and ethanol facility near Portland, OR, from Cascade Kelly Holdings L.L.C. for $95 million. The transaction includes a rail transloading facility served by BNSF, 200 MBbl of storage capacity, a deepwater marine terminal, a 1,200-foot dock and the largest ethanol plant on the West Coast. In November 2012, the facility began transloading unit trains of crude oil. The Oregon site is linked via BNSF to the Global Zap terminal in Beulah, N.D.

The three companies that we surveyed in this episode of our Bakken terminals series are all large midstream players that have recognized the advantages of providing access to rail for Bakken crude shippers. Plains has built up a network of rail load and unloading terminals that provides customers with access to East and West Coast destinations as well as a large terminal at St. James, LA on the Gulf Coast. Enbridge is a “thoroughbred” pipeline company that came late to the rail terminal game but the company’s investment in the East Coast Eddystone Terminal indicates that they are doing more than just flirting with crude by rail as an alternative to pipelines. Global is a regional midstream company with most of its operation in the Northeast US but has rapidly adapted to the possibilities that crude by rail offers and has now expanded to the West Coast. The significant investment that these companies are continuing to make is testament to their belief that the crude by rail business is here to stay. Above all they are offering shippers optionality in their crude destinations that pipelines cannot match. In the next episode in this series we will look at the smaller crude by rail terminal operators in North Dakota.

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Big New Crude by Rail Terminal for Port Arthur, TX

David Starling the CEO mentioned that Kansas City Southern Railroad is negotiating with a customer to locate a Crude by Rail terminal at Port Arthur, TX. The terminal would be designed to unload five unit trains per day of Heavy Canadian Crude, this would imply that the terminal would be twice the size of the recently announce Kinder Morgan terminal at Houston. The announcement caused a big spike in KCS stock as it would increase KCS traffic as much as 8 % depending on whether the trains come from CN or CP. Interchange from CP would give KCS a longer haul meaning more revenue.

John Beaulieu