Tuesday, October 28, 2014

Tar Sands Train to Ruin

How tar sands producer Southern Pacific Resources is going broke on shipping tar sands by rail

priceofoil.org   10/28/14
Lorne Stockman, co-written with Anthony Swift, Attorney at the International Program, Natural Resources Defense Council

...In the summer of 2012, advocates of Keystone XL hailed Southern Pacific Resources’ announcement that it had signed a five-year contract to bypass pipeline bottlenecks and ship tar sands by rail to the Gulf Coast as proof that tar sands projects would move forward with or without pipelines. Two years after becoming the first tar sands producer to attempt to rely entirely on rail to ship its production to the Gulf, Southern Pacific Resources’ stands on the brink of financial ruin.

Rather than proving that rail can be an alternative to pipelines to the Gulf Coast, Southern Pacific Resources’ experience illustrates the profound economic obstacles associated with tar sands production.....

....The State Department looked to Southern Pacific Resources as an example of the feasibility of tar sands by rail to the Gulf.....

...Unfortunately for Southern Pacific Resources, it hasn’t worked out. The combination of high transportation costs and poor performance at its main tar sands SAGD project have driven the company to the verge of bankruptcy. ....  read more here

Hat Tip to Mary Kaye for this link!

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