U.S. Crude-By-Rail Shipments Continue to Sag

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Researched by Industrial Info Resources (Sugar Land, Texas)--Crude-by-rail shipments on U.S. railroads for the third quarter of this year were down nearly 52% from the same quarter in 2015, the Association of American Railroads (AAR) said Wednesday. Even so, the association says it saw "glimmers of hope" in overall rail traffic levels for November.

The AAR reported U.S. Class I railroads originated 48,978 carloads of crude oil in third-quarter 2016, down 52,189 carloads, or 51.6%, from the third-quarter 2015, and down 7,476 carloads, or 13.2%, from the second-quarter 2016.

Crude-by-rail shipments continue to drag as a result of low oil prices.

Among the crude-by-rail terminal projects being tracked by Industrial Info is NGL Energy Partners LLC's (NYSE:NGL) (Tulsa, Oklahoma) $75 million barge and truck loading and unloading terminal in Houma, Louisiana. Located on the Intracoastal Waterway, the 200,000-barrel-per-day (BBL/d) project is currently expected to be completed in April 2017. However, kick-off slippage so far has been 15 months beyond the date this project was originally planned to begin construction.

Despite the lower crude-by-rail shipments, the AAR indicated the overall U.S. railcar numbers for last month provide hope for the future. Carload traffic in November totaled 1,319,008 carloads, up 0.4%, or 5,406 carloads, from November 2015.

"There are glimmers of hope in rail traffic data in November, with carloads and intermodal totals both up over last year--something that hasn't happened for carloads in 22 months and for intermodal in nine months," said AAR Senior Vice President of Policy and Economics John T. Gray in a press statement. "Hopefully, these results are indicators of continuing future growth for the manufacturing economy, for trade, and for rail traffic. It appears that economic fundamentals are trending toward more positive results than have been seen in the recent past."

Industrial Info is tracking 154 active U.S. rail projects with a combined value of $12.8 billion.

In California, Burlington Northern Santa Fe Railway, a unit of Berkshire Hathaway Incorporated (NYSE:BRKA) (Omaha, Nebraska), is expected to begin construction in first-quarter 2017 on the 2.8 million-container-unit-per-year International Gateway Intermodal Facility near the ports of Los Angeles and Long Beach. The $500 million project could see completion by mid-2019.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.