Tag Archives: North Dakota

“Shale by Rail”

In a previous post we noted the transformation of America’s energy industry by the development of “shale oil” from fields in North Dakota and Texas.  The development of these fields, their size and the technology to reach them was entirely unexpected even by industry experts.  A few years ago the term “peak oil” was on everyone’s lips.  Today, we’re looking at a new gusher that may last a thousand years.

The fact that this development was so unexpected and so fast has meant that the infrastructure to bring the oil and gas to market has lagged.  It has proved to be a boon to railroads, just as coal shipments have slipped.  From OilPrice.com we get this analysis:

If North American infrastructural constraints have yielded one clear winner, it is the railroads. With much of the production increases coming from remote locations in North Dakota and Alberta, there has been a major shortage of pipeline outlets for the glut of crude. Railroads have eagerly rushed to fill the gap in a phenomenon that is rapidly becoming known as “shale by rail.” Crude oil shipments on US Class I railroads have correspondingly increased over 3200% in the past five years. A Class I railroad is defined as a carrier with an operating revenue of more than $433.2 million.  Presently, there are seven such railroads operating in the United States. The American Society of Civil Engineers estimates that freight tonnage will increase 22% by 2035, rising from 12.5 billion tons to 15.3 billion tons.

Rail Carloads of Crude Oil


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The REAL American Transformation!

People in Washington may believe they’re transforming America. They are wrong. America is being transformed, but it has nothing to do with politics. It’s happening in North Dakota, Texas, the Rust Belt and Silicon Valley.


• By 2016 the United States will surpass Saudi Arabia and Russia as the world’s biggest oil producer and is on track to become energy self-sufficient in two decades. North Dakota and Texas are leading the charge.


• Steel manufacturing in mini-mills is replacing big, antiquated mills using a fraction of the labor and energy cost. Thanks to energy and labor cost advantages, foreign companies are building major new plants in the US.


• While no one was looking, 3D printing is beginning to revolutionize manufacturing and medicine. GE is making major parts of its jet engines via 3D printing. Medical device manufacturers are developing casts, bones, skin and even lungs using 3D printers.

These developments are creating jobs, transforming our lives and creating an American renaissance. But because they are not in the headlines, few people are even aware that this is where the real American transformation is taking place. There is a very good chance that the 21st Century, not the 20th Century, could be the REAL American Century.

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