For those that think that killing just this small extension makes any difference.....give your stupid head a shake.
Up to five times a week, a train 100 cars long and brimming with heavy oil slows to a halt in the yard of Gateway Terminals, a rail-to-barge transfer station located on the edge of the Mississippi River in St. Louis, Missouri.
Each train can carry up to 60,000 barrels of the viscous product, which needs to be heated before it is piped into one of four 98,000-barrel storage tanks located on site.
From there the oil is loaded into the shallow hauls of river barges, each destined for heavy oil refineries in Texas and Louisiana. In a good week, the terminal can transfer 350,000 barrels of oil into the slow-moving, flat-bottomed vessels.
It’s a fairly straightforward business. The throughput at Gateway Terminals, in terms of volume, hasn’t changed much in six years of operation.
But there has been one subtle adjustment. Up until mid-2013, the company transferred ethanol onto barges, but the terminal has since been converted to accept a more lucrative commodity: oil sands bitumen.
“We are targeting the Canadian barrel. That’s the business that we’re looking at,” says Marshall Bockman, the vice-president of Gateway Terminals LLC, the operator of the terminal.
On March 24, 2014, the company announced it had sent out its second-ever barge shipment of bitumen since converting from ethanol to heavy crude. Gateway, says Bockman, is now purchasing a fifth 98,000-barrel tank to expand its storage capacity.
Similar Development is taking place elsewhere. Tesoro Corp., a refiner, is building a $100-million rail-to-barge terminal in Vancouver, Washington, to supply Canadian oil to refining facilities along the U.S. west coast. Valero Corp., a company that owns and operates 16 oil refineries, can shuttle 35,000 barrels per day (bpd) down the Mississippi from a terminal in Hartford, Illinois, to facilities on the Gulf Coast, though it has been tight-lipped about precise volumes of its day-to-day shipments.
The Energy Information Administration recently reported Canada-sourced oil imports in 2013 reached an average of 2.5 million bpd, up 3.9 per cent from 2012, despite a highly publicized pipeline capacity shortage.
At least a portion of this is due to higher volumes of oil being shipped by railcar. And, because the rail business is so interconnected with inland river ports, increased railcar activity has led to increased opportunities for barge shipments.
Marshall Bockman, vice-president of Gateway Terminals LLC
Photograph Corey Woodruff
For companies like Gateway Terminals, converting to oil was a welcome alternative. “The ethanol business went through some difficult times with the drought a couple years ago,” Bockman says.
“Because of that drought, the ethanol market was very difficult.” For producers such as Calgary-based MEG Energy Corp., which ships a portion of its oil by barge, the method offers better trade optionality, the company has said. It is also a fairly economic mode of transportation.
But is it wise to ship large volumes of oil via water-borne vessels? After all, pipelines by design avoid waterways and cities; rail lines, less ideally and also by design, cut through cities and along waterways.
It might seem logical that the practice of transporting crude oil over water is an accident waiting to happen. Convincing the public this is a viable, safe option could be more work than transporting the oil itself.
Despite their chugging, cumbersome appearance, inland barges are relatively speedy, faster on average than pipelines – yet markedly slower than railcars.
When two freight-carrying waterborne vessels collide, it happens in slow motion. In the Houston Ship Channel in Galveston, Texas, where a barge delivering bunker fuel crashed into a bulk carrier in March 2014, radio recordings of the incident reveal that the two pilots spent five minutes attempting to clear out of one another’s path.
The barge, owned by Kirby Corp., the largest supplier of commercial barges in the United States, spilled 636,000 liters of fuel oil and caused irreversible ecological damage, according to some experts.
Some believe the spill exposed the risk of shipping oil by barge, particularly in one of the country’s busiest ports. But the trend isn’t solely taking place in the Gulf Coast region.
Excess heavy Canadian oil destined for refineries in the U.S. Midwest via pipeline may soon be transported by barge across various sections of the Great Lakes.
While no producers have yet expressed interest publicly, a proposed terminal in Superior, Wisconsin, is mulling the idea of converting its dock to accept crude oil shipments from inland water vessels.
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With production on the rise oil-by-barge traffic sets off greater safety concerns - Alberta Oil Magazine Canada s leading source for oil and gas newsAlberta Oil Magazine Canada s leading source for oil and gas news