In the December issue of WorkBoat we once again take a look at the Top 10 news stories of the year.
One of the top news stories of 2014 is the effect crude oil production increases due to hydraulic fracking have had on domestic inland barge companies.
Though rail is still the dominant mode of transportation from the Midwest and Canadian oil fields to the East Coast, barges are getting a lot more play between there and the Gulf Coast. In response, barge carriers have been committing more equipment to crude in the Mississippi River corridor.
“Our potential as a global energy leader is rooted in our ability to safely transport our game-changing energy resources safely every time, be it by barge, truck, pipeline or rail,” the American Petroleum Institute (API) said in its latest report on the state of U.S. energy.
“While these alternatives provide flexibility for transportation gaps, they must be integrated into a systematic restructuring designed to meet long-term needs.
“In the absence of sufficient pipeline location and capacity, transportation by rail and barge has increased significantly. Barge shipments from the Midwest to the Gulf Coast are up nearly 90,000” barrels per day since 2010, the API report said.
This has led to a big increase in crude oil shipments along the Mississippi and other inland waterways.
In 2010, crude oil shipments from the Midwest to the Gulf were nonexistent. By the end of 2013, volumes were close to 5 million bbls. per month.
To meet demand, tank barges have been built at a record pace. In 2013, inland tank barge deliveries topped the 300 mark, up from 261 in 2012. Demand was so strong that Trinity Marine Products converted its Caruthersville, Mo., hopper barge construction facility so it could build more 10,000-bbl. tank barges.
The construction binge has continued in 2014. Through September, 266 tank barges were delivered to the inland barge sector, up from 251 over the same period in 2013, according to River Transport News. Ironically, while the number of barge deliveries has increased, capacities have decreased slightly as 10,000-bbl. tank barge orders have overtaken the demand for 30,000-bbl. barges, RTN reported.
“We’re seeing a tremendous amount of crude oil and chemicals, fracturing sand, Bakken oil moving by rail,” Mike Toohey, chief executive of the Waterways Council Inc. told WorkBoat in September. “Oil is considered a higher value commodity, so it gets the rail capacity.”
