The above is the headline on a short article (apparently dated "09.04.2009") in the Railway Age "News" section, at:
http://www.railwayage.com//content/view/737/217/
Following are the notable points:
- CN believes it can be price-competitive with a pipeline;
- Not enough pipeline capacity presently;
- Rail can be more flexible in delivery/ sales locations - to many different markets (inlcuding export) than a pipeline;
- CN will be shipping 10,000 barrels daily by the end of this year.
At 42 gals. per barrel and 23,000 gallons per tank car, that would be 18 to 20 tank cars per day.
I couldn't find anything directly related to this concept / marketing strategy or "Pipeline on Rail" at CN's website - esp. the Media section. However, I did find a web page on "Alberta Oil Sands" in the "Shipping - Where You Can Ship - North America" section, at:
http://www.cn.ca/en/shipping-north-america-alberta-oil-sands.htm
It addresses all aspects of possible rail involvement in those projects, but seems more focused on shipping the materials and equipment in rather than the bulk liquid product out.
This reminds me of Trains columnist and author John Kneiling's comments in the late 1960s and early 1970s - mainly in connection with the then-proposed construction of the 800-mile long Alaska oil pipeline - that when something like this was happening, the railroads usually limited themselves to asking "How do we route the pipe ?" Meaning, that the rails never tried to compete on the long-term movement of the produced oil itself - they just let the pipelines take that traffic - and instead contented themselves with the short-term traffic of hauling just the the construction machinery, production equipment, and various supplies during the construction phase - including the same pipe that they felt they couldn't compete with over the long-haul ! (both time-wise and geographically)
Here, however, it looks like CN is going to make a run at getting at least some of this traffic. And since then, the industry has the benefit of acquired experience from the several GATX "Tank-Train"(tm) operations, at least 1 of which is in Quebec, Canada, and the one in California that seems to have different end-points from time to time (and possibly others as well). So I'll wish CN well, and look forward to seeing how this plays out. It could be interesting !
Any other views and insights on this ?
- Paul North.
I believe PC had a "pipeline on rails" program to and from Oswego, NY back in the 70's or 80's...I think it was linked to barge from Port of Albany. Cars actually were hooked, or piped, from car to car. See Trains, etc. for the time for picturs, etc.
RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.
henry6 - Now that you mention it, I recall that one, too.
I've done a little more Internet searching on this and found a trio of much better (though similar within themselves) articles / commentary by Diane Francis of the Canadian Financial Post ("National Post") datelined April 8, 9, and 11, 2009, at:
http://www.financialpost.com/story.html?id=1479094
http://www.financialpost.com/news-sectors/energy/story.html?id=1479470
http://www.financialpost.com/related/links/story.html?id=1486255
From one of the comments to a re-publication of one of these articles in the "Free Republic" (?) at: http://www.freerepublic.com/focus/f-news/2225734/posts
“The rail option also circumvents the problem, for Canadian producers, of reliance on monopoly markets in the United States, and on the fickleness of environmental politics south of the border.”
This is the key to the article. They do not want to rely on the US market because of our lefty loony environmentalists. With rail it is more flexible to ship their product wherever the highest bidder is.
CANADA IS MORE CAPITALISTIC THAN THE US.
The 1st Financial Post article linked above says that the pipeline charge from Alberta to the U.S. Gulf Coast is $17.95 (Canadian $ ?) per barrel. So let's work with that number a bit little to see what an equivalent rail rate would be, and to assess the possible competitiveness of an all-rail move:
1 barrel = 138.8 kilograms** x 2.2* = 305.4 lbs. / 2,000 lbs. per ton = 0.153 ton.
* - Approximate or estimated value, subject to correction and refinement, as well as all subsequent figures that depend on it.
(** - For Texas Crude, per WikiAnswers - http://wiki.answers.com/Q/How_much_does_1_barrel_of_crude_oil_weigh - I couldn't find a comparable figure for oil sands crude very quickly or easily, so I'll use this one for the time being)
305.4 lbs. per (barrel = 42 gals.) = 7.27 lbs. per gallon (water is about 8.34 lbs. per gallon ["a pound a pint"] ), so this is a relative density of 7.27 / 8.34 = 0.872 - looks OK for now;
$17.95 / (barrel = 0.153 ton) = $117/ ton.
$117/ ton / 2,000* miles = 5.87 cents per ton-mile.
For a 23,000 gal. tank car x 7.27 lbs. per gal. = 167,210 lbs. / 2,000 lbs. per ton = 83.6 tons - OK, well within capacity for a 263,000 lb. gross wt. car = 131.5 tons.
83.6 tons x $117/ ton = $9,780 per carload revenue.
$9,780 per car / 2,000 miles = $4.89/ car-mile.
For a 100 car train, that would be $489 per train-mile; at 20 MPH, that would be $9,780 per train-hour.
Conclusion: Oh, yeah, this pipeline rate is a sitting duck for a well-organized rail move. There's probably a good amount of "monopoly profit" in the pipeline rate - since pipeline capacity is apparently limited and hence constrained and priced higher, so the pipeline rate likely could be lowered in response to rail competition, esp. since the pipeline is already built and in place and up and running - but I doubt if it would get so low as to undercut the rail rates. Definitely worth exploring further. Will be interesting to watch !
Paul_D_North_Jr henry6 - Now that you mention it, I recall that one, too. I've done a little more Internet searching on this and found a trio of much better (though similar within themselves) articles / commentary by Diane Francis of the Canadian Financial Post ("National Post") datelined April 8, 9, and 11, 2009, at: http://www.financialpost.com/story.html?id=1479094 http://www.financialpost.com/news-sectors/energy/story.html?id=1479470 http://www.financialpost.com/related/links/story.html?id=1486255 From one of the comments to a re-publication of one of these articles in the "Free Republic" (?) at: http://www.freerepublic.com/focus/f-news/2225734/posts “The rail option also circumvents the problem, for Canadian producers, of reliance on monopoly markets in the United States, and on the fickleness of environmental politics south of the border.” This is the key to the article. They do not want to rely on the US market because of our lefty loony environmentalists. With rail it is more flexible to ship their product wherever the highest bidder is. CANADA IS MORE CAPITALISTIC THAN THE US. - Paul North.
I would hope that some of our Canadian forum members would elaborate but Canada has plenty of "green left" types in government..if power shifts back from the Conservative party to the Liberals there could be changes in Oil Sands production, ect..
"I Often Dream of Trains"-From the Album of the Same Name by Robyn Hitchcock
Some more thinking about this over lunch* leads me to the conclusions that:
(* - as the westbound NS local came by with 5 cars, an SD40-2 still in CR blue on the leading end, and a GP-40 on the training end)
1) If a significant portion of the potential production here goes by rail, it'll become close to another Powder River Basin size operation (on the order of 18 trains per day for 1 million barrels per day to the US Gulf Coast, 73 trains per day if all of the potential 4 million barrels per day go there);
2) The railroad can get set-up to do this for significantly less total capital investment - about only 35 to 65% of what the pipelines are reported to need - and still have all the advantages of flexibility, scalability, timing, etc.;
3) Study and design, experience, and technical advances will refine these preliminary figures. For example, as in the PRB, the optimum train length is more likely in the 135 to 150 car range - particularly as volume increases and track capacity in terms of number of trains per day becomes more of a constraint. Also, since the tank cars have less of a cross-section and load lighter per linear foot of train length than coal cars (since the oil is less dense), a given payload weight will need a longer train length for oil than for coal;
Where do I sign up to get started on this ?
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Some supporting calculations:
Consider an initial design train of 100 tank cars of 23,000 gal. capacity each, and 6 locomotives of 4,400 HP each.
Capital cost, per train: About $22 million
Cars: 100 cars @ $100K each = $10 million
Locomotives: 6 @ $2 million each = $12 million
Train Statistics:
Weight - Total Gross (loaded): approx. 13,260 tons
Cars: 100 @ 120 tons each = 12,000 tons
Locomotives: 6 @ 210 tons each = 1,260 tons
HP/ ton: About 2.0
6 locos x 4,400 HP = 26,400 HP / 13,260 tons = 1.99 HP/ ton - OK;
Typ. speeds: 20 MPH minimum
(from Al Krug's "Train Forces Calculator by AAK" at: http://www.alkrug.vcn.com/rrfacts/RRForcesCalc.html )
Level tangent track - 75 MPH
1 % grade & 5-degree curve: 20.5 MPH - OK;
Scheduling: About 10-day / 240 hours round-trip turnaround
2,000 miles one-way / 20 MPH average = 100 hours one-way;
Load (or unload) 100 cars at 5 / hour (12 mins. avg.) = 20 hours
Total = 120 hours = 5 days; x 2 directions = 240 hours = 10 days.
Capacity: 2.3 million gallons = 55,000 bbls. per train
23,000 gals. per car / 42 gals. (US) per barrel (bbl.) = 547, say 550 bbls. per car
100 cars @ 23,000 gals. = 2.3 million gallons = 55,000 bbls. per train
Productivity: About 5,500 bbls. delivered per day, per train-set
55,000 bbls. per train-set / 10-day turnaround time = 5,500 bbls. per day delivered, on average, per train-set
1 million bbls. per day / 55,000 bbls. per train-set = 18.2 trains per day.
No. of Train Sets Needed:
1 million bbls. day production / 5,500 bbls. delivered per day per train-set = 182 train-sets needed;
x 4 for 4 million bbls. per day = 728 train-sets needed.
Capital Required: $16.0 Billion (for 4 million bbl. / day)
728 train-sets of 6 locos & 100 cars (4,368 locos & 72,800 cars)
at $22 million each (see above) = $16.0 Billion
U.S. Gulf Coast Pipeline estimate: $ 24.7 billion for 4 million bbls. per day
Rail is $ 16.0 B / $ 24.7 B = only 65 % as much
$22 million per train-set / 5,500 bbls. per day delivery capability =
$4,000 capital cost per bbl. per day delivery capability
Canadian West Coast Pipeline Estimate: $ 4 Billion for 600,000 bbls. per day
Rail would be 600,000 bbls. per day x $4,000 per bbl. per day capability =
$2.4 Billion / $ 4.0 B = only 60 % as much.
Actually, way less than that. The distance from Edmonton to Kitimat is about 850 miles direct, say 1,000 miles with circuity account of the mountains, so the cycle time would drop to about 140 hours or 6 days = 60 % as long. Hence, with similar calucaltions only 60 % as much equipment would be needed - about 66 trainsets @ $22 million each (11 trains per day) = $ 1.45 Billion, or about 36 % as much as estimated for the pipeline.
Paul_D_North_JrCANADA IS MORE CAPITALISTIC THAN THE US.
Hello Everyone.
Let us start with the above. Most of the players, but not the biggest one, are US companies working in the most conservative province in Canada where resource production is a provincial jurisdiction. So yes they're off to a good start.
As to your estimate of Oil Sands specific gravity, my gut feeling is your a little high. Lloydminister Heavy Crude has a S.G. of about 10 I think, and Oil Sand would be much less that that. Think thick oatmeal porridge, not cold maple syrup. It has to be processed once before it can be shipped by pipeline, and to save this cost and develop some kind of tank car/hopper hybrid would make this proposal interesting. If you didn't have to do this first processing, think coal train car weights and handling characteristics.
Now comes the difficult part. There is muskeg between Fort McMurray, AB and the rest of the world. The Alberta & Great Waterways Railway built the line up there in the 1920's. Waterways was/is a barge loading point for cargo up the Mackenzie River to communities up to the Arctic Ocean, less than 10 miles or so from Fort McMurray. It became the Northern Alberta Railway, then CN, then the Mackenzie Northern (I think) and it is now CN again.
Brief example of muskeg. In a TRAINS or CLASSIC TRAINS article within the last year or so there was a story about a man who took a round trip up there in about 1960. He was in the Passenger Car/Caboose looking back at water covering the rails as the train went forward. Next day they come back and the track is above water as the engine passes and he sees water coming over the rails behind him. They can't run trains there everyday, because the rails eventually wouldn't come back above water again. Needless to say this is hard on wood ties, hence the provincial assistance to CN for a ROW repair project mentioned in TRAINS Newswire in the fall of 2007.
Still though, with all the difficulties mentioned, the one thing I like about this plan is it's ability to adapt to changing market conditions and demand locations. If, they can keep their head's literally above water.
AgentKid
So shovel the coal, let this rattler roll.
"A Train is a Place Going Somewhere" CP Rail Public Timetable
"O. S. Irricana"
. . . __ . ______
Paul: Could I suggest some different values for some of the variables:
RWM
All I can say is:
1) It's about time..
2) I own shares in CN..so more power to them!
And CP ...I look forward to seeing your own plan for oil in AB.
A question and a comment.
Paul - Did I miss how we got from 10,000 bbl/day to 1,000,000 bbl/day?
RWM - I do not think the tare weight penalty for coils and insulation will be excessive. The question as to its value is how much time on steam the insulation would save and the value of that time. My 1979 GATX Tank Car Manual has data for two 20,000 gallon net, nominal 100 ton cars for general service. Uninsulated tare is 57,800 without coils. The implied weight of the coils is 2,000 pounds. The same car with 4" of insulation and heater coils tare is 70,300 pounds. Clearly a car designed for crude would be bigger and the tank size optomized for the specific product. The car would also have to be AAR specification unless the 263,000 gross weight limit for DOT cars has been or would be changed.
Mac
AgentKid: How I hate muskeg!!! Since it can vary mile to mile many different solutions are needed. Of course the pipeline would also have to deal with these problems. The problems of having to heat the oil mirror thoses that the Alask pipeline has had to deal with. Either pipeline or RR will have many problems to solve.
PNWRMNMA question and a comment. Paul - Did I miss how we got from 10,000 bbl/day to 1,000,000 bbl/day? RWM - I do not think the tare weight penalty for coils and insulation will be excessive. The question as to its value is how much time on steam the insulation would save and the value of that time. My 1979 GATX Tank Car Manual has data for two 20,000 gallon net, nominal 100 ton cars for general service. Uninsulated tare is 57,800 without coils. The implied weight of the coils is 2,000 pounds. The same car with 4" of insulation and heater coils tare is 70,300 pounds. Clearly a car designed for crude would be bigger and the tank size optomized for the specific product. The car would also have to be AAR specification unless the 263,000 gross weight limit for DOT cars has been or would be changed. Mac
See 74 FR 1802, Jan. 13, 2009. Weight in excess of 263,000 can be increased to 286,000 so long as quantity of commodity isn't increased. I think this would apply to the insulation and coils. It does for TIH shields and shells.
Heating the oil so it will flow, I understand. How about churning it or even pumping it from car to car to keep it fluid? Or does it have to be heated?
henry6Or does it have to be heated?
To pump it, you heat it. Otherwise you use a shovel.
Paul:
Actually, if anyone was seriously thinking about moving 1mm bbl/day of heavy oil, one would probably say, "let's build refineries in Edmonton and push product through pipeline instead." It is highly economically undesirable to move large quantities of low-value unrefined commodities over land for long distances for long periods of time. Even iron ore, which ostensibly moves long distances, is usually only moving half-way to meet the coal, which is also moving half-way.
AgentKidhenry6Or does it have to be heated? To pump it, you heat it. Otherwise you use a shovel. AgentKid
But on the bright side of things, when the unheated car derails, the oil doesn't go too far.
Paul_D_North_JrThe 1st Financial Post article linked above says that the pipeline charge from Alberta to the U.S. Gulf Coast is $17.95 (Canadian $ ?) per barrel. So let's work with that number a bit little to see what an equivalent rail rate would be, and to assess the possible competitiveness of an all-rail move: 1 barrel = 138.8 kilograms** x 2.2* = 305.4 lbs. / 2,000 lbs. per ton = 0.153 ton. * - Approximate or estimated value, subject to correction and refinement, as well as all subsequent figures that depend on it. (** - For Texas Crude, per WikiAnswers - http://wiki.answers.com/Q/How_much_does_1_barrel_of_crude_oil_weigh - I couldn't find a comparable figure for oil sands crude very quickly or easily, so I'll use this one for the time being) 305.4 lbs. per (barrel = 42 gals.) = 7.27 lbs. per gallon (water is about 8.34 lbs. per gallon ["a pound a pint"] ), so this is a relative density of 7.27 / 8.34 = 0.872 - looks OK for now; $17.95 / (barrel = 0.153 ton) = $117/ ton. $117/ ton / 2,000* miles = 5.87 cents per ton-mile. For a 23,000 gal. tank car x 7.27 lbs. per gal. = 167,210 lbs. / 2,000 lbs. per ton = 83.6 tons - OK, well within capacity for a 263,000 lb. gross wt. car = 131.5 tons. 83.6 tons x $117/ ton = $9,780 per carload revenue. $9,780 per car / 2,000 miles = $4.89/ car-mile. For a 100 car train, that would be $489 per train-mile; at 20 MPH, that would be $9,780 per train-hour. Conclusion: Oh, yeah, this pipeline rate is a sitting duck for a well-organized rail move. There's probably a good amount of "monopoly profit" in the pipeline rate - since pipeline capacity is apparently limited and hence constrained and priced higher, so the pipeline rate likely could be lowered in response to rail competition, esp. since the pipeline is already built and in place and up and running - but I doubt if it would get so low as to undercut the rail rates. Definitely worth exploring further. Will be interesting to watch ! - Paul North.
Paul, I think if you had free, spare infrastructure or very little new infrastructure to move this business, that's one thing. For large quantities, the costs will skyrocket. Moreover, this is a Catch-22 freight business: the bigger the volume becomes, the more economically incentived the shipper is to look for lower-cost alternatives. Long-distance movement of petroleum products by rail in North America has only occurred in special cases:
I know of just one long-term movement of significant quantities of petroleum products by rail in the U.S. not as a result of #2 or #3 above -- in other words, exactly one case where there was a solid economic case for rail versus pipeline. That economic niche is quite small; either the quantities are small and the move not significant, or the quantities large and the economics more favorable for pipeline. That example is the now going on 90-years move of refined petroleum from Denver to Grand Junction, Colo., which amounts to about 50 carloads per day at present, for what was at first Conoco, then Conoco and Vickers, then Conoco, Asamera, and Vickers, then Conoco and Total, and now Suncor. The business has never been quite enough to justify a pipeline, especially because there's truck competition out of North Salt Lake City/Woods Cross, Utah; Roosevelt, Utah; sometimes Sinclair (Parco), Wyoming; and Gary, Colorado, from 1958-1983 or so. And as the business grows, so does the cost of the pipeline; the pipeline economic case has always been just out of reach.
BTU input per ton/mile for pipelines is usually significantly lower than rail, ranging from 2:1 to 4:1 depending upon specific pipeline commodity and route characteristics. That's the Achilles heel of the rail cost delta, because it accumulates over time.
Thanks to all for your thoughtful responses, and dialogue. My initial approach to this was, "Do we laugh at it, or take it seriously ?" I was just treating this as a "back-of-the envelope" exercise (I have big envelopes !) merely to see if this concept had any hope of working out, or if it was just wishful thinking - "Will it get off the ground ?" is a common expression that is used - and was only going as far into it as the results seemed to lead me.
It seems everyone thinks this idea has some merit, and concur that this is probably worthy of further study (by CN or someone). I'm seeing points that indicate a need for a 2nd stage of early study and refinement, not "show-stoppers", and I pretty much agree with all of them. For example, to address just one of the comments (what I think is the most glaring omission in my little exercise) - I was seeing if just the capital cost for the equipment would put this out of the running (it didn't). As a result, I didn't take the time to address the infrastructure needs and costs. But even using a "worst-case" scenario of having to upgrade the whole 2,000 route-miles from Edmonton to the U.S. Gulf Coast at RWM's figure of $2.5 Million per mile would add only $ 5.0 Billion to the $16 Billion for the equipment, for a total of $21 Billion for the rail move, as opposed to $24.7 Billion for the pipeline alternative.
If I have more time tonight or tomorrow morning, I'll try to respond further.
By the way: The 10,000 bbl. / day is the expectation for the end of 2009; 4 million bbl. / day is the ultimate possibility mentioned in the article. But as an "intermediate" or "unit" figure just to simplify the calculations, I used 1 million bbl./ day, since of course it is simple to scale up or down from a nice round figure such as that to other values that might be more applicable as this goes on.
Thanks again.
20 carloads a day is a nice-to-have for a division's revenue figures and will hit the radar screen (for a couple of minutes) on the executive floor. 200 carloads a day is an appreciable quantity, but that's also a threshold level where serious costs start appearing for infrastructure. 20 carloads a day might not be "seen" by the infrastructure for quite a while, but 200 carloads a day will quickly have effects. Generally speaking, if the infrastructure can support a new business with 200 carloads a day during ordinary economic times without a huge cost impact on the infrastructure (on a single-track railroad), someone had really missed the mark on building and maintaining that infrastructure.
Railway Man 20 carloads a day is a nice-to-have for a division's revenue figures and will hit the radar screen (for a couple of minutes) on the executive floor. 200 carloads a day is an appreciable quantity, but that's also a threshold level where serious costs start appearing for infrastructure. 20 carloads a day might not be "seen" by the infrastructure for quite a while, but 200 carloads a day will quickly have effects. Generally speaking, if the infrastructure can support a new business with 200 carloads a day during ordinary economic times without a huge cost impact on the infrastructure (on a single-track railroad), someone had really missed the mark on building and maintaining that infrastructure. RWM
Meaning that the infrastructure was seriously overbuilt in some respects (kind of like the railroad verison of that proverbial glass that's half-full - it's twice as big as it needs to be !)
That would be yet another illustration of a principle in many parts of life - if it has a name, I have not heard it - to the effect that you can get away with almost anything on a small scale. It either falls between the cracks, no one notices, no one cares, or if they do, they can work around whatever inconvenience or disruption that it may cause, etc. But when that "exception" becomes the norm, then things change drastically - it cannot always be scaled up from a small minority to a large majority of anything without disproportionate effects showing up. This is another example of that - 20 more cars can be fit in without too much trouble, but 200 are going to have real effects.
Except that "It depends" on the "background" pre-existing configuration, condition, and usage of that infrastructure. 200 cars a day is only 2 or 3 decent sized trains. Most of the NS secondaries and mains that I'm familiar with around here could easily handle that with only a pro-rata increase in the maintenance - but then they're almost all 132 RE rail with good ties and ballast - and the traffic is only 2 to 4 trains a day on the secondaries, 30 to 50 trains a day on the 2 main tracks lines, so no new passing sidings, etc. would be needed. If the track(s) is(are) lightly used for what it is - remember, there's no such thing as a partial track, if it's there at all - then it's going to be sitting unused a lot of the time. But I can easily picture a single-track line with 100 lb. jointed rail and sidings at 30 to 50-mile intervals and 10 to 12 trains a day where adding 2 or 3 more trains is going to mean either drastic changes in the scheduling, or a lot of new sidings, etc.
However, this doesn't appear to be such as middle or marginal case. Once CN gets past the current year's projection of around 20 cars a day and starts to ramp up on this, each 1 million bbls. per day looks like it will need around 18 trains a day - each way. I doubt those northern ALberta lines have anything near that capability now, and so that's going to force serious infrastructure investment to occur, regardless of what's there now and how it's being used, no question about it.
Paul_D_North_Jr Meaning that the infrastructure was seriously overbuilt in some respects (kind of like the railroad verison of that proverbial glass that's half-full - it's twice as big as it needs to be !) That would be yet another illustration of a principle in many parts of life - if it has a name, I have not heard it - to the effect that you can get away with almost anything on a small scale. It either falls between the cracks, no one notices, no one cares, or if they do, they can work around whatever inconvenience or disruption that it may cause, etc. But when that "exception" becomes the norm, then things change drastically - it cannot always be scaled up from a small minority to a large majority of anything without disproportionate effects showing up. This is another example of that - 20 more cars can be fit in without too much trouble, but 200 are going to have real effects. Except that "It depends" on the "background" pre-existing configuration, condition, and usage of that infrastructure. 200 cars a day is only 2 or 3 decent sized trains. Most of the NS secondaries and mains that I'm familiar with around here could easily handle that with only a pro-rata increase in the maintenance - but then they're almost all 132 RE rail with good ties and ballast - and the traffic is only 2 to 4 trains a day on the secondaries, 30 to 50 trains a day on the 2 main tracks lines, so no new passing sidings, etc. would be needed. If the track(s) is(are) lightly used for what it is - remember, there's no such thing as a partial track, if it's there at all - then it's going to be sitting unused a lot of the time. But I can easily picture a single-track line with 100 lb. jointed rail and sidings at 30 to 50-mile intervals and 10 to 12 trains a day where adding 2 or 3 more trains is going to mean either drastic changes in the scheduling, or a lot of new sidings, etc. However, this doesn't appear to be such as middle or marginal case. Once CN gets past the current year's projection of around 20 cars a day and starts to ramp up on this, each 1 million bbls. per day looks like it will need around 18 trains a day - each way. I doubt those northern ALberta lines have anything near that capability now, and so that's going to force serious infrastructure investment to occur, regardless of what's there now and how it's being used, no question about it. - Paul North.
Paul, I am skeptical that any line that can bite off an additional 12 MGT/year (the equivalent of 200 286K cars + empty return) with only a pro-rata increase in maintenance is not overmaintained and overinfrastructured. I'm sitting here with a couple of Division Engineers tonight, and they're rolling their eyes.
A line with 100-lb stick rail and 10 to 12 trains a day? 2-3 more trains aren't going to be much of a problem there because they'll never be able to get past all the derailments from the 10-12 trains.
Interesting thread! Thanks Paul/RWM.
If this idea of the oil train takes off and CN ends up with (picking an average) of 125-150 cars/day and I would wonder which route to refineries it would take: Central US or interchange elsewhere? If Central US I'd wonder how close to needing 2nd track/more sidings CN is through WI. With container traffic coming from the Pacific to Chicago & returning on the CN there are times when (to me anyway) it seems there are some botlenecks, especially if local/manifest trains stay near where they are in terms of quantity & lengty. That being said paper traffic is (was) declining through the same area at the same time. I'm not sure of how many carloads of material that generated (paper) but I'd imagine it was or had the potential to be in the neighborhood of ~100 carloads/day (total). So if the paper industry comes back and the oil is going strong...there you are again I suppose.
Either way...I think this will be an interesting story to follow.
Dan
AgentKid, I'm just curious, are you saying the Arctic Ocean is less than ten miles or so from Fort McMurray? Or that Waterways is? I think it's pretty obvious that the Arctic Ocean is much farther.....much, much farther. Also, Waterways is no longer the terminus of the line nor anywhere near that far from town. You might be looking at a mile, but it's more likely even less than that. The last railway serving town before CN reacquired the trackage was the Athabasca Northern.
First off, we need to figure out whether they are proposing to move oil, or bitumen by rail. They are not the same thing here at all. Very little bitumen is actually shipped by pipe right now, the majority is upgraded in the Fort McMurray area into a synthetic oil blend. That product is very easy to pump, easier in fact than conventional crude oil. Bitumen is more along the line of tar, but as I mentioned, very little is actually shipped in it's raw state anyhow. The material that is shipped in bitumen form, is diluted so that it will flow easily. No heating is required provided it is diluted, and it is pumped to upgraders north east of Edmonton.
My bet would be that they are planning on hauling the upgraded synthetic crude, as it would be easier to sell to people on a spot market type of situation.
The real issue with this plan, is the extreme state of decay associated with the current rail line to Fort McMurray. I have heard it estimated that the upgrade of the line to the standards that would be required for day to day use of this type would be in the neighborhood of 1 billion dollars.
Couple that with the fact that the current railhead is anywhere from 40 or so km from the nearest plant, and 80 or more from the most distant, and I think you would find costs to be a bit prohibitive.
Brian
Brian, Yes, I admit it, my original post was grammatically unsound. I know where Fort McMurray is, as my uncle was an electrical foreman on the original Great Canadian Oil Sands plant, now Suncor, when it was built in 1966. As to Waterways distance from Fort McMurray I was going from my memory of the TRAINS article I mentioned.
I hadn't read the article posted in the link before I posted, so I mixed Mackenzie Northern with Athabasca Northern. MN has a similar history in north west Alberta; original builder-Northern Alberta Railway-CN-Mackenzie Northern-CN.
I was going to post all this and more once I was able to locate links to stories about CP's activities near Edmonton to answer Ulrich's question above. Mention of paper plant's above also got me looking at the Canadian Trackside Guide and SPV's Western Canada Railroad Atlas. I hope to get back to this thread later today.
Railway Man Paul, I am skeptical that any line that can bite off an additional 12 MGT/year (the equivalent of 200 286K cars + empty return) with only a pro-rata increase in maintenance is not overmaintained and overinfrastructured. I'm sitting here with a couple of Division Engineers tonight, and they're rolling their eyes. A line with 100-lb stick rail and 10 to 12 trains a day? 2-3 more trains aren't going to be much of a problem there because they'll never be able to get past all the derailments from the 10-12 trains. RWM
to that last paragraph above ! [emphasis and emoticon added - PDN.]
There's just too much fun to be had here, but this is ancillary to a sidetrack to the main point of this thread - and I've just gotten assigned to a "special project" at work that's likely to keep me busy through the middle of next week; So, briefly:
- 200 cars a day is one thing; that they're 286K cars is quite another thing (that detail wasn't in your earlier post). But that does change my initial response to the comment. It's long been known that 286K cars (and by extension, 315K cars) are disproportionately harder on the track than 263K cars that I referenced earlier - but no one on the executive floor (or the operating or marketing floors, either) wants to hear that, or more importantly, budget the appropriate $ and track time to fix up the additional wear-and-tear that the heavier cars cause - so why bother ? But I do concur with the 12MGT/ year figure - actually, I got closer to 14 MGT;
- With the bigger rail, improved metallurgy, and concrete ties & fasteners, etc., I think that going forward, most of the damage or effects from the heavier cars is now going to show up primarily further down/ deeper in the track structure instead - such as in the subgrade below the ballast section, or the main structural elements of the bridges, etc.
- I was going to make some snappy comeback about your Division Engineer friends, but on further reflection I suspect there's a regional and operational / historical disconnect between me, and you and them, such that we're not really discussing the same image in our respective minds. Here in eastern Pennsylvania and nearby areas all of the main lines and most of the branches have had 130 lb. or heavier rail (OK, the 122 CB on the B&O, but up to 155 PS on the PRR) to accomodate heavier "mineral" (coal, iron ore, stone, etc.) traffic since before I was born, and what ConRail kept didn't then suffer from much downsizing or degrading from that. We also have excellent and cheap ballast rock sources, and subgrade soil conditions that are generally as good as or better as those to be found anyplace else. So what we take for granted here and could easily accomodate 2 - 3 more trains a day for the most part perhaps would seem overbuilt and overmaintained someplace else, such as a single track line through the vast open spaces of the west.
- Accordingly, my 10 to 12 trains per day on 100 lb. jointed rail example was merely a fictional attempt to create a common scenario in both of our minds of a line that is "on the cusp", where that much more traffic is enough to push it over the maintenance edge (or be the last straw that breaks the back of the proverbial camel) from the standpoint of creating far more maintenance costs that merely a proprotional increase in the tonnage would indicate. I can only think of 1 line of that nature in this region - the former PRR DelMarVa Secondary from Wilmington to Cape Charles (a barge ride opposite Norfolk), which used to be just that in a mix of sand and stone ballast. But ever since the power plant at Indian River (Del.) was expanded for coal in the late 1970s, that too became 132+ CWR. So I have to reply on pictures of lines in the muskeg country, across (or through) the "gumbo" and other alluvial soils down south, etc. Recalling what happened to the ICG and others when they started running unit trains of grain hoppers on poorly surfaced jointed rail track (39-ft. lengths with staggered surface-bent joints ==> harmonic rocking off the track), the track getiing beat down into the mud, etc. - if my experiences had been with that stuff, I might well feel the same way;
- That said, I still have to challenge that point in a couple of ways: Are you guys serious that a double-track main line with 136 RE CWR on concrete ties on 12"+ of trap-rock ballast, presently signallled and used for around 20 trains a day each way (say, 100 to 130 MGT annually total, including empties), is going to suffer disproportionately (= significantly more than just pro rata) higher maintenance costs from adding just 2 or 3 more trains to move those 200 286K cars (12 to 14 MGT) each day ? Or if that cost increase isn't happening, do you really mean to say that means the line is instead seriously overbuilt and/ or overmaintained ? (That reminds me of the response to a complaint about Mozart having too many notes in one of his operas: "OK, which ones should I take out ?")
If the track maintenance budget can be tracked that closely and predicted that well - which I respectfully doubt - then someone tell me how the coefficient of the MGT component in that budget (or costs) - i.e., the "X" in the $X per MGT amount - changes significantly just because the traffic level changes from 120 MGT by a 10 % increase to 132 MGT or so. Further, in which component of the track is that cost increase chiefly occurring - rail wear ? tie deterioration / surfacing ? subgrade settlement ? If these questions can't be answered authoritatively, then there are at least several cases that disprove the general proposition, and we're back to where I started: "Maybe - it all depends on the existing configuration, condition, and usage of the line."
More to come later.
Paul_D_North_Jr- 200 cars a day is one thing; that they're 286K cars is quite another thing (that detail wasn't in your earlier post). But that does change my initial response to the comment. It's long been known that 286K cars (and by extension, 315K cars) are disproportionately harder on the track than 263K cars that I referenced earlier - but no one on the executive floor (or the operating or marketing floors, either) wants to hear that, or more importantly, budget the appropriate $ and track time to fix up the additional wear-and-tear that the heavier cars cause - so why bother ? But I do concur with the 12MGT/ year figure - actually, I got closer to 14 MGT; - With the bigger rail, improved metallurgy, and concrete ties & fasteners, etc., I think that going forward, most of the damage or effects from the heavier cars is now going to show up primarily further down/ deeper in the track structure instead - such as in the subgrade below the ballast section, or the main structural elements of the bridges, etc.
- Accordingly, my 10 to 12 trains per day on 100 lb. jointed rail example was merely a fictional attempt to create a common scenario in both of our minds of a line that is "on the cusp", where that much more traffic is enough to push it over the maintenance edge (or be the last straw that breaks the back of the proverbial camel) from the standpoint of creating far more maintenance costs that merely a proprotional increase in the tonnage would indicate. I can only think of 1 line of that nature in this region - the former PRR DelMarVa Secondary from Wilmington to Cape Charles (a barge ride opposite Norfolk), which used to be just that in a mix of sand and stone ballast. But ever since the power plant at Indian River (Del.) was expanded for coal in the late 1970s, that too became 132+ CWR. So I have to reply on pictures of lines in the muskeg country, across (or through) the "gumbo" and other alluvial soils down south, etc. Recalling what happened to the ICG and others when they started running unit trains of grain hoppers on poorly surfaced jointed rail track (39-ft. lengths with staggered surface-bent joints ==> harmonic rocking off the track), the track getiing beat down into the mud, etc. - if my experiences had been with that stuff, I might well feel the same way; - That said, I still have to challenge that point in a couple of ways: Are you guys serious that a double-track main line with 136 RE CWR on concrete ties on 12"+ of trap-rock ballast, presently signallled and used for around 20 trains a day each way (say, 100 to 130 MGT annually total, including empties), is going to suffer disproportionately (= significantly more than just pro rata) higher maintenance costs from adding just 2 or 3 more trains to move those 200 286K cars (12 to 14 MGT) each day ? Or if that cost increase isn't happening, do you really mean to say that means the line is instead seriously overbuilt and/ or overmaintained ? (That reminds me of the response to a complaint about Mozart having too many notes in one of his operas: "OK, which ones should I take out ?")
If the track maintenance budget can be tracked that closely and predicted that well - which I respectfully doubt - then someone tell me how the coefficient of the MGT component in that budget (or costs) - i.e., the "X" in the $X per MGT amount - changes significantly just because the traffic level changes from 120 MGT by a 10 % increase to 132 MGT or so. Further, in which component of the track is that cost increase chiefly occurring - rail wear ? tie deterioration / surfacing ? subgrade settlement ? If these questions can't be answered authoritatively, then there are at least several cases that disprove the general proposition, and we're back to where I started: "Maybe - it all depends on the existing configuration, condition, and usage of the line." - Paul North.
Somewhere I think the two of us got a bit tangled up on whether we were talking the specific case or the general. To recap where I'm at, I'm arguing the general case. In general, I am skeptical that the general rail line in the U.S., in normal economic times (which means normal traffic) can take 12 more MGT a year, and the engineering department saying "no problem, just an "x" percent increase in our costs based on the proportion increase to the existing MGT." Because the moment they say that, everyone is going to start doubting their veracity on every budget they publish. Sure, I can find specific lines that can take it, but those were already overbuilt for their current tonnage.
Here are two of the links I was looking for regarding CN's operation up to Fort McMurray.
http://www.trains.com/trn/default.aspx?c=a&id=2530
http://www.trains.com/trn/default.aspx?c=a&id=2909
More to follow, I hope.
UlrichAnd CP ...I look forward to seeing your own plan for oil in AB.
Ulrich,
Here is the link I was looking for to answer your question.
http://www.trains.com/trn/default.aspx?c=a&id=1996
Search engines and me do not get along, but I find myself on a bit of a roll at the moment. Yesterday I would never have guessed the keywords necessary to find this link. "Shell" and "upgrader."
So, just hypothetically speaking....200 cars per day (loaded) = 400 per day (with mts).
If the destination were say...Whiting, Indiana BP refinery, which is gearing up with a major rebuilding, or if it were the Louisiana area then CN would definately have some capacity issues in and around Chicago on the EJE and on the IC south of Chicago.
The IC was double tracked at one time and no doubt the ROW could go back to 2 tracks. The J would be a possible issue...wouldnt it?
ed
CN stock up 42% off of its recent lows. BNSF up 34%. UP is up 46%.
So, the market is probably not factoring in a oil sands catalyst, at least yet.
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