American Oil and Gas Reporter - November 2015 - 76

Unit Trains Deliver Record Frac Sand Volumes

On Oct. 2, a 150-car unit train carrying
16,500 tons of fracture sand and powered
by five diesel locomotive engines arrived
at Rangeland Energy's RIO Hub near
Loving, N.M., establishing a North American record for the amount of sand moved
in a single rail shipment according to a
company announcement.
Extending 6,675 feet in length, the
unit train originated in Ottawa, Il., and
was operated by BNSF Railway, which
transferred service of the train in Clovis,
N.M., to its short-line railway partner,
Southwestern Railroad, for delivery to
the RIO Hub, Rangeland says.
It notes the previous largest rail shipment of frac sand had occurred only three
months earlier, when Twin Eagle Sand
Logistics LLC landed a 140-car unit train
at the Mission Rail Terminal in Elmendorf,
Tx., on Independence Day. Powered by
four Union Pacific Railway engines, the
140-car train measured 6,200 feet long
and held 14,000 tons of frac sand supplied
by Unimin Energy Solutions for distribution in Eagle Ford Shale operations.
Despite reduced drilling and completion activity, proppant volumes
pumped per well are increasing in unconventional plays, leading to opportunities to increase efficiencies though
large unit train shipments, says Steve
Broker, Rangeland's executive vice pres"The crude oil market can be very
unpredictable, but moving shipments by
rail enables producers to respond to those
changes by moving their products where
they get the best price at any given time,"
she says.
According to the Association of American Railroads, U.S. Class I railroads
originated 9,500 carloads of crude oil in
2008. Last year, they originated 493,146
carloads-more than a 50-fold increase
(each tank car holds 700 barrels of oil on
average). Perkins says the biggest advantage rail transport offers producers is
increased flexibility to access premium
markets to ensure the highest net backs
for their sales volumes.
"Providing customers with origin optionality and destination diversity allows
them to pick and choose where their
product ultimately will be shipped to
maximize their profits for each shipment,"
she comments.
The oil price downturn is expected to
diminish the total volumes moved by
train, but Perkins says rail will continue
to play a pivotal role. "Modern U.S. oil
production has resulted in the market

76 THE AMERICAN OIL & GAS REPORTER

ident and chief operating officer.
"Despite the current pricing environment, the Delaware Basin remains an
economic play, and producers operating
in the region continue to require increasingly large volumes of frac sand to drill
and complete their wells," he remarks.
"We expect sand volumes to continue to
increase as operators drill longer wells
and complete larger fracs."
According to Broker, the unit train
was unloaded within 22 hours and the
sand was stored at the hub to supply an
operator with a large quantity of sand for
high-volume hydraulic fracture treatments
in Delaware Basin horizontal wells.
Part of Rangeland's RIO System, the
RIO Hub is a 300-acre rail terminal for
outbound crude oil and condensate and
inbound frac sand. The hub was fully
commissioned in July, Broker reports, and
provides frac sand suppliers with unit train
unloading, silo storage and truck loading
facilities for moving large quantities into
the Delaware Basin. Initial rail-to-truck
transload service began in November 2014.
"Unit train service provides a more
cost-effective and reliable means of shipping large volumes of sand than manifest
service," he says. "The RIO Hub has
received 31 unit trains and additional
manifest rail cars to date, with more
than 1 billion pounds of frac sand dis-

tributed into the region."
Rangeland commissioned 26,000 tons
of silo storage capacity in early August.
"Demand for frac sand remains high in
the Delaware Basin, and we expect volumes to increase significantly in the
months ahead," Broker remarks. "As a
result, we plan to expand the RIO Hub to
accommodate more than 1 million tons
of frac sand a year. We also are working
with crude oil and condensate customers
regarding the installation of truck unloading
facilities, tankage and storage services,
and rail and pipeline connectivity."
Griff Jones, Twin Eagle's chief executive officer, echoes the trend toward
larger proppant volumes per well in the
Eagle Ford and elsewhere. "The sand intensity of today's wells continues to rise
materially, with some requiring upward
of 80 rail cars of sand or more," he says.
The 1,000-acre Mission Rail terminal
was constructed to efficiently handle large
frac sand unit trains, and includes a 60million pound frac sand silo system. "The
silo system is scaled to house up to 300
rail cars' worth of frac sand and can load
a truck in less than two minutes." Jones
offers. "We believe world-class terminal
infrastructure is necessary to help our
Eagle Ford Shale customers manage their
logistics efficiently and reduce supply
chain costs into the basin."
❒

seeking transportation alternatives to
move oil to destination markets," she remarks. "Rail will continue to fill the gap
in crude oil transport capacity, providing
an innovative and reliable solution through
unit trains well into the future."
A single unit train can haul more than
70,000 barrels of crude. Unit trains offer
advantages versus manifest trains by
moving through the rail network with
fewer stops, getting products to market
quicker and with greater flexibility. "Transporting crude by unit train also means
that customers can get their crude to
market up to five times faster than by
pipeline," Perkins explains.

elsewhere.
"We have gone above and beyond the
federal requirements and operate those
trains at a maximum speed of 35 mph in
high-threat urban areas plus municipalities
with populations of 100,000 or more,"
Perkins details. "We also have enhanced
the frequency of rail detections by 2.5
times the rate required by federal regulations, and lead the rail industry in developing and testing positive train control
(PTC) technology, a networkwide system
using global positioning data to monitor
and control train movements to prevent
collisions."
As part of a $50 billion investment
during the past 15 years to improve its
rail network's safety and reliability, BNSF
already has invested more than $1.5
billion in testing, developing, purchasing,
and installing PTC components, she adds.
When fully implemented, PTC will be
deployed on roughly half of BNSF's system and host 80 percent of its freight
density.
"Rail is one of the safest ways to
transport crude oil. In 2014, we moved
99.99 percent of hazardous materials

Enhancing Safety
In March, BNSF changed its operating
procedures to help further reduce the risk
associated with moving hazardous materials, which included reduced speeds for
moving crude. The move pre-empted
rules the Federal Railroad Administration
issued in May that limited the maximum
speed for trains carrying crude oil and
other materials to 40 miles an hour in
"high-threat" urban areas and 50 mph

American Oil and Gas Reporter - November 2015

Table of Contents for the Digital Edition of American Oil and Gas Reporter - November 2015