Barges are being utilized to move Eagle Ford crude oil to refining markets in Houston, New Orleans, and Port Arthur. Kirby Corp, a company that operates inland barges, said yesterday that as many as 140 barges across the U.S. are being used for crude oil. (That's in all areas and not just the Eagle Ford). The 140 represents a ten-fold increase from a decade ago. Moving oil on barges had become an almost non-existant business until plays like the Eagle Ford began producing oil in areas without spare pipeline capacity. Without pipelines, you begin looking for the next best thing. Utilization rates for trucks, tanks, and barges are at modern day highs.
Some of the Eagle Ford movements will be ultimately be kind of medium term" said Pyne, adding that pipelines under construction will eventually replace some of the barges as a means to carry crude from the Eagle Ford.
"But I do think that the the volume coming out of the Eagle Ford and Canadian crude that is being exported to Baton Rouge is sustainable."
Shale oil from the Eagle Ford deposit in southeast Texas has come on strong this year, rising to 272,000 barrels per day (bpd) in June from 70,000 bpd in April, according to energy consultancy Bentek. Some experts say it could top 400,000 bpd by 2013.
Read the full news release at reuters.com