• 1 day PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 1 day Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 1 day Syrian Rebels Relinquish Control Of Major Gas Field
  • 1 day Schlumberger Warns Of Moderating Investment In North America
  • 1 day Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 1 day Energy Regulators Look To Guard Grid From Cyberattacks
  • 1 day Mexico Says OPEC Has Not Approached It For Deal Extension
  • 1 day New Video Game Targets Oil Infrastructure
  • 2 days Shell Restarts Bonny Light Exports
  • 2 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 2 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 2 days British Utility Companies Brace For Major Reforms
  • 2 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 2 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 2 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 2 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 2 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 2 days Rosneft Signs $400M Deal With Kurdistan
  • 3 days Kinder Morgan Warns About Trans Mountain Delays
  • 3 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 3 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 3 days Russia, Saudis Team Up To Boost Fracking Tech
  • 3 days Conflicting News Spurs Doubt On Aramco IPO
  • 4 days Exxon Starts Production At New Refinery In Texas
  • 4 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 4 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 4 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 4 days China To Take 5% Of Rosneft’s Output In New Deal
  • 4 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 4 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 4 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 5 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 5 days OPEC Oil Deal Compliance Falls To 86%
  • 5 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 5 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 5 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 5 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 6 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 6 days Aramco Says No Plans To Shelve IPO
Kuwaiti Minister: OPEC Deal Extension May Be Unnecessary

Kuwaiti Minister: OPEC Deal Extension May Be Unnecessary

Kuwaiti Oil Minister Al-Marzouk has…

5 Picks For A Booming Tech Market

5 Picks For A Booming Tech Market

Technological breakthroughs like artificial intelligence…

Railways Favouring Oil, Leaving Canada’s Record Grain Crop Stuck on the Prairie

Railways Favouring Oil, Leaving Canada’s Record Grain Crop Stuck on the Prairie

As the boom in production of crude oil in North America has grown it has far exceeded the flow capacity offered by pipelines. Transporting oil by rail has proven an effective alternative and demand for rail car tankers has risen to record levels.

One problem is that much of the supply given over to meet the new demand has been taken from elsewhere, meaning that other commodities are losing out as railway operators favour crude oil shipments. A record harvest of wheat and canola last year, combined with the increased shipments of crude by rail, means that an estimated 3 million tonnes of grain are still stuck on the Canadian Prairie, awaiting transport to the grain buyers.

Keith Bruch, the vice president of operations for Paterson Global Foods Inc., claimed that shipments of grain are two months behind schedule due to a shortage of rail cars created by the increased demand to transport oil.

“It’s looking more and more that grain is becoming second choice to oil. The railways make decisions on where they put their power and crews to maximize revenue.”

Related article: DOT-111 Safety Major Issue in Crude-By-Rail Debate

Transport Canada reported that the number of rail cars carrying crude oil in 2012 was at 53,453, compared to just 143 in 2009, as the country’s two largest railway companies, Canadian National Railway Co. and Canadian Pacific, tap into the growing demand to ship crude oil created by rising production in Alberta.

Mark Hemmes, the president of Quorum Corp., which monitors the transportation of grain around Canada, explained that organising and allocating rail cars and labour for transporting grain and oil can take months of planning, meaning that the surge in demand from the oil industry has clashed with the unexpected surge in demand from the grain industry, and left railway operators struggling to respond.

Ed Greenberg, a spokesman for Canadian Pacific, said that “Grain is Canadian Pacific’s single largest commodity and therefore very important to our railway. We are responding to our grain customers as efficiently and quickly as possible.”

Bruch stated that grain buyers are getting angry as the delays are costing companies money. Some ships have been idling in Vancouver for weeks as they wait for grain to arrive, costing from C$12,000 ($10,700) to C$20,000 ($18,000) a day.

Sam Snyder, the director of corporate development for Grain Millers Inc., said that “moving crude by rail has definitely impacted our ability to supply our facilities.” He stated that carriers are trying to respond to this new demand from the oil industry and that it is difficult to tell whether or not it is just a “blip or the new standard.”

By. Charles Kennedy of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News