US Phillips 66 plans to buy rail cars to move shale oil

11 June 2012 22:50  [Source: ICIS news]

HOUSTON (ICIS)--Phillips 66 plans to buy 2,000 rail tank cars to move shale oil to its US refineries in the next year or two, a company spokesman said on Monday.

Spokesman Romelia Hinojosa said the energy producer intends to purchase the railcars.

Phillips 66 CEO Greg Garland said last week during an energy conference that the company was considering the purchase.

“We’re considering buying a couple thousand more rail cars so we can get Bakken crude either east [or] west,” said Garland during the conference.

There are 100 rail tank cars per train, said Garland. If Phillips 66 purchased 2,000 cars, they would add more than 100,000 bbl/day of crude for the company’s refiners to process, he said.

Currently, Phillips 66 refineries can process about 100,000 bbl/day of shale-related crudes, said Garland. The shale crude is very light, close to a condensate, and is blended with conventional oil for processing at the refineries.

“If you think about the [mid-continent], we think there’s about 2 million barrels a day of new light sweet crude coming on in the central part of the US,” Garland said.

He said every dollar saved on a barrel of oil equates to about $500m (€400m) of net income gained for Phillips 66, so there is incentives to find ways to process these crudes at the company’s refineries.

$1 = €0.80

Twitter: Sheena_Shale_ICIS

By: Sheena Martin
+1 713 525 2653

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly

Get access to breaking chemical news as it happens.
ICIS Global Petrochemical Index (IPEX)
ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index