Monday, June 11, 2012

Phillips 66 to buy 2,000 rail cars to ship shale oil

Houston-based refiner and marketer Phillips 66 plans to buy as many as 2,000 railroad tank cars to ship oil from shale fields to its refineries, another indication that the shale boom is shaking up the U.S. energy industry, according to Reuters.

Phillips Chairman and CEO Greg Garland during a presentation at last week's Citi Global Energy Conference said the plan is targeted for "the next year or two."

Oil companies in thriving shale fields such as South Texas' Eagle Ford and North Dakota's Bakken have turned to rail, trucks and barges to move crude because pipeline development has not kept up.

"That's a pipeline on wheels," Garland said. "So, that could go to the Bakken. It could go to the Niobrara. It can shift as the opportunity shifts around the country."

The Eagle Ford has emerged as one of San Antonio's prime economic generators as energy companies work the play for crude, natural gas and natural gas liquids.

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Sanford Nowlin covers energy/utilities, transportation/aviation and manufacturing.

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