Despite ridiculous protests a year ago, North Dakotans are reaping the benefits of a completed Dakota Access pipeline, according to the Wall Street Journal:
The pipeline has significantly lowered energy transportation costs and energy companies to move their oil to the Gulf Coast, where it fetches a higher price. So it’s little surprise that energy production has surged since the Dakota Access Pipeline opened.
Between September and October alone, oil production grew by 78,000 barrels a day, the biggest month-over-month increase North Dakota has ever seen.
And…
The Dakota Access Pipeline has also reduced oil-train traffic within the state. The last time oil production was this high, North Dakota saw as many as 12 trains, or 1,200 cars, pass through daily. Today, only two trains do. That’s a victory for the environment and public safety, given that oil-spill accidents occur with much greater frequency on railways than in pipelines.
Laughably inaccurate story, they picked meaningless, point-in-time stats to support a rah-rah thesis. Reality is even vastly better than they report. Wellhead price is only up an average $2 to $3 / barrel, depending on what formation the well is located at, the real story is more flexible shipping capacity. Production was capped the past few years at about 1.1 mpd because existing pipelines and rail availability was completely maxed out. Adding 400 mpd capacity via Dakota Access completely revolutionizes product shipping and, more importantly, product marketability.
Oil is not fungible: even in the relatively homogenous Bakken formation, there are five major crude “flavors” that are marketed as different products. Increased transportation will allow more timely delivery of which flavor is in demand by which refinery, etc. etc. etc.: all greatly increasing revenues to producers who may only have 1 flavor in their well set. Ability to better deliver product in demand as needed, increasing revenues for all product, is the real story.
“the real story is more flexible shipping capacity. Production was capped the past few years at about 1.1 mpd because existing pipelines and rail availability was completely maxed out. Adding 400 mpd capacity via Dakota Access completely revolutionizes product shipping and, more importantly, product marketability…Increased transportation will allow more timely delivery of which flavor is in demand by which refinery, etc. etc. etc”
Several good points, mhs. Solid post.
The country is crisscrossed with oil pipelines and will continue to be. The focus should not be on whether they are built, but on how they are built. I’m tired of the dishonesty on both sides of the pipeline debate. And I don’t want South Dakota to subsidize any more pipelines with tax breaks. The oil buyers and sellers can pay taxes like everyone else.
Pipes scare libbies. Trains don’t.
and boreholes. Always those boreholes.
Well Warren Buffet doesn’t make money off of pipelines….so hence pipelines are bad.
Remember it is only in Mr. Pay’s paranoid mind that The Borehole was going to be used for nuclear waste. The Borehole was just #4Science. Even Mr. H stated so.
I think The Borehole was one of Mr. H’s too blogging subjects for 2017.
So once it gets to the Gulf, will it be sold to China and shipped to North Korea?
“The pipeline has significantly lowered energy transportation costs and energy companies to move their oil to the Gulf Coast, where it fetches a higher price.”– Whoops, they just admitted the reason a foreign Co.is trying to steal Americans land through eminent domain…. I think the refinery region of the coast is a tax free zone…..Where does the oil go from there and what mode of transport?