EIA: Additional Transnational Pipeline Capacity Could Reduce Crude Shipped by Rail
The U.S. Energy Information Administration (EIA) recently highlighted the role of new additional pipeline capacity in potentially reducing the amount of crude oil that is shipped via rail:
The Enbridge Line 3 replacement pipeline, which delivers crude oil from Edmonton, Alberta, in Canada to Superior, Wisconsin, became fully operational on October 1, 2021, increasing the pipeline’s capacity to 760,000 barrels per day (b/d). Before the replacement, Enbridge Line 3 had a capacity of about half that amount. Because the Line 3 replacement project increases the capacity to import crude oil by pipeline from Canada, this pipeline could reduce the need to ship crude oil from Canada by other modes, especially rail.
U.S. crude oil imports from Canada have gradually increased over time and made up more than 60% of total U.S. crude oil imports in 2020. Most of this crude oil from Canada comes into the United States by pipeline. Importing crude oil from Canada by rail is often more expensive than by pipeline, but crude oil producers and shippers in Canada sometimes ship crude oil by rail because of its destination flexibility or because the pipeline capacity is insufficient to support all of the crude oil imports from Canada.
Studies have shown that pipelines are the safest, most efficient, and most environmentally-conscious method of shipping oil and gas. Further, projects like Line 3 and Dakota Access are key to safely and affordably transporting the oil that fuels the U.S. economy while also strengthening U.S. energy security interests. Policymakers must continue to foster a regulatory environment that welcomes investment in critical energy infrastructure and development of North American energy resources.