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#1 Bingo

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Posted 17 January 2012 - 07:33 PM

Tar Sands Express - Enbridge Northern Gateway Pipeline or the Railway? Or Both?

Since I am a fan of rail, that would be my choice for getting tar sands oil to a West Coast tanker terminal.

The rail line is already there, and it can be used for more than one purpose.


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Edited by Bingo, 03 October 2018 - 09:35 AM.


#2 Bernard

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Posted 18 January 2012 - 11:40 AM

Is there much history of bulk movement of oil by rail? The capacity of a rail car seems to be in the range of 600 to 800 barrels of oil. To move the same amount of oil as the proposed Northern Gateway pipeline, you would need 650 to 875 rail cars per day.

#3 Bingo

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Posted 18 January 2012 - 12:36 PM

Is there much history of bulk movement of oil by rail? The capacity of a rail car seems to be in the range of 600 to 800 barrels of oil. To move the same amount of oil as the proposed Northern Gateway pipeline, you would need 650 to 875 rail cars per day.


I don't know the value of this information, but this is what was said.

"By autumn 2008, CN Rail approached the Alberta government with its plan to move tar sands oil. Alberta's Energy Minister at the time, Mel Knight, told Dow Jones Newswire that CN and his government have had "very good meetings," with CN believing that it could eventually transport 400,000 barrels per day from eastern Alberta to the West Coast of Canada.
Just six months later, CN was estimating that it could transport 2.6 million barrels per day to the West Coast if 20,000 railcars were added to its fleet.
On April 15, 2009, the Financial Post's Diane Francis reported that CN "will deliver the oil sands production through the use of insulated and heatable railcars or by reducing its viscosity by mixing it with condensates or diluents. The ‘scalability' of the concept - up to millions of barrels per day - means that the railway can ramp up production cheaply and quickly to provide immediate cash flow to producers which otherwise will have to wait years for completion of upgraders and/or pipelines."
The project, wrote Francis, "will eliminate three barriers" to tar sands development: "the cost, delays and financial risks involved in building multi-billion dollar pipelines; the politics of obstruction south of the border from environmentalists, and the danger of selling oil to monopoly buyers in the US."

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#4 Bernard

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Posted 18 January 2012 - 03:27 PM

That would be a huge amount of traffic on the rail line. It also has a lot more opportunity for spills due to derailments and in the loading/unloading of the rail cars

#5 G-Man

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Posted 18 January 2012 - 04:19 PM

This would also limit the line for shipping containers to the new port in Prince Rupert.

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#6 Bernard

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Posted 18 January 2012 - 04:52 PM

2.6 millions barrels - that is 3300 rail cars arriving at the port per day. This is between 80 and 85 kilometers of rail cars arriving each day.

At 24 hours a day, this means you have to unload 2.3 rail cars per minute.

At something in the range of $150,000 to $200,000 per rail car, 20,000 of them would be a capital outlay of $3 to $4 billion, or more than half the estimated cost of the Northern Gateway pipeline, though 20,000 cars would deliver more oil

#7 Bingo

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Posted 09 February 2012 - 03:12 PM

If the rail line to Prince Rupert were double tracked in appropriate locations, tanker cars could keep up with the volume once the facilities on the coast were in place.

Oil by rail can be diverted to different locations as supply and demand changes, much like moving busses to a different route. Pipelines take time to build, the rail network is already in place, and it is a multi-purpose as to what travels over it.

Example:

"In the meantime, oil production in the Bakken Shale area of northwest North Dakota is ramping up rapidly. Last November, output passed the 500,000-barrel-a-day level. By 2013, state officials expect to drillers to pump 750,000 barrels per day from the stubbornly hard rock formations and to surpass 1 million by 2015. “Pipelines are by far the safest and most economically efficient way to transport oil, but we are left with a limited number of options if pipelines are off the table,”Tony Clark, chairman of the North Dakota Public Service Commission, told the AP. “Once the oil is flowing, it has to go somewhere.”

"If not by pipeline, producers have but one option: a train. A modern railroad tank car holds 700 or more barrels of crude oil. So a 100-car train can take 70,000 or so barrels of oil wherever the customer wants it to go."

"One-fourth of 500,000 barrels a day, the current production, comes to almost two unit trains a day, which is about what BNSF Railway and Canadian Pacific Railway are carrying. By the end of this year, make that three or four trains per day, and in 2013, five or six or seven. At the moment, BNSF has six loading facilities for crude oil in North Dakota, CP two (but CP is also active in Saskatchewan)."

http://cs.trains.com...-and-grows.aspx


Edited by Bingo, 04 December 2016 - 06:57 AM.

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#8 Mike K.

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Posted 10 March 2012 - 12:51 PM

I wasn't aware that an Enbridge pipeline ruptured in Michigan back in 2010.

A friend of mine just posted the following picture on Facebook showing a sign along a riverbank warning individuals not to enter the river.


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#9 Coreyburger

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Posted 10 March 2012 - 07:23 PM

Can I vote for neither?

#10 North Shore

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Posted 10 March 2012 - 07:45 PM

^ Me, too. Or at least let's build a refinery in Alberta, and export refined products - keeping jobs here in Canada.
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#11 renthefinn

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Posted 10 March 2012 - 09:46 PM

^ Me, too. Or at least let's build a refinery in Alberta, and export refined products - keeping jobs here in Canada.


There are refineries in Alberta, even a couple in BC.... I know the Burnaby Chevron refinery is having a hard time competing though...

#12 VicHockeyFan

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Posted 10 March 2012 - 09:47 PM

^ Me, too. Or at least let's build a refinery in Alberta, and export refined products - keeping jobs here in Canada.


Is that feasible? All BC refineries together process about 70,000 barrels a day, while some Gulf of Mexico refineries are at or over 500,000 barrels per day. And aren't the northern Alberta refineries just upgrader plants, making the heavy oil suitable to stuff into a pipe?

A refinery produces all kinds of other byproducts when it processes crude, I'm not sure locating a full refinery so far away from where the other products are of use is economically viable.
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#13 Sparky

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Posted 10 March 2012 - 10:35 PM

^ Great questions VHF, but we have the raw materials. Couldn't we figure out how to make a value added product....and sell retail instead of wholesale?

Perhaps our labour costs are too high?

#14 VicHockeyFan

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Posted 11 March 2012 - 03:58 AM

^ Great questions VHF, but we have the raw materials. Couldn't we figure out how to make a value added product....and sell retail instead of wholesale?

Perhaps our labour costs are too high?


Oh, we could make it. We could make it right up in northern Alberta. But does it make economic sense to have rail cars and/or trucks leaving Ft. McMurray with benzene, kerosene, motor oil, gasoline, grease, varsol, plastic base, propane etc. and all the tens or hundreds of other things we make crude oil into. It sounds to me that we'd have lots of car/trucks leaving, then going all over the place, after traveling long distances, then an awful lot of the same vessels coming back empty.

On the other hand, the big Irving refinery in the Maritimes makes all that stuff, and trucks/trains it a small distance to consumers and industrial plants in New York, Pennsylvania or Ohio.

It's easy for me to see which one is less expensive. It's easy for me to see that a pipeline right down to Beaumont, TX makes more sense, the goo goes down there, becomes end-products, and supplies the Texas, Arizona and southern California markets.
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#15 Mike K.

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Posted 11 March 2012 - 08:26 AM

Canada has some of the largest oil reserves in the world and supplies a number of countries with crude. Meanwhile our gas prices at the pump are the highest in North America.

Why is that?

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#16 VicHockeyFan

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Posted 11 March 2012 - 08:50 AM

Canada has some of the largest oil reserves in the world and supplies a number of countries with crude. Meanwhile our gas prices at the pump are the highest in North America.

Why is that?


Because we haven't nationalized our resource industries, and we shouldn't. We should pay market rates just like the rest of the world does. Why should we buy oil from ourselves for a low price, when we can get a higher price from the rest of the world? There would be less incentive to be competitive and efficient if we sold to ourselves for cheap.

Check out why communism doesn't work, Mike. Oh, and prices at the pump have a lot to do with the taxes at the pump. The US has much less, most of Europe much more.

Persian Gulf nations including the U.A.E. subsidize domestic utilities and commodities such as gasoline as a way of redistributing oil income to the local population.


http://www.bloomberg...any-losses.html

But that's a bad idea. Even ridiculous societies like the UAE are realizing it.
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#17 Mike K.

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Posted 11 March 2012 - 09:37 AM

What does communism have to do with anything?

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#18 Sparky

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Posted 11 March 2012 - 09:51 AM

What does communism have to do with anything?


In communist countries the state has control of the goo. (VHF that was the best line I have read ever)

In the free world we let big business have control of the goo. :mad:

#19 VicHockeyFan

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Posted 11 March 2012 - 10:45 AM

What does communism have to do with anything?


What Sparky said. Also, with communism, you nationalize most if not all industry, then suddenly there is no competition or profit motive for companies to innovate and work at maximum efficiency. You can see this underway today in Cuba.
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#20 Mike K.

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Posted 11 March 2012 - 03:32 PM

Right, I understand what communism is, but why are you saying "Check out why communism doesn't work, Mike?"

I'm not making comparisons between different economic theories, I'm pointing out we pay more for gas in Canada than in America, Mexico, even Honduras.

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