Traveling along new energy paths

It could be an energy footnote — but in Philadelphia, perhaps, it’s confirmation that the city isn’t treading a new energy path alone.

Shipments of oil and petroleum products by rail have soared in the first half of this year, up 38 percent, according to rail industry numbers.

The oil’s mostly coming from the Bakken Shale formation in North Dakota.In Philadelphia, when Sunoco announced it would partner with the Carlyle Group to run its Philadelphia refinery, the companies said they would start using Bakken crude, instead of importing fuel for the refinery from West Africa.Arup Mallik of the federal Energy Information Administration, an agency of the Department of Energy, explains that believe it or not, Nigeria’s easier to buy from than North Dakota.

Paradoxically, that’s actually resulting in cheaper crude from North Dakota.”It’s hard to get the crude out of the region so [North Dakota product] is discounted [by sellers] as an incentive to get the crude moving,” says Mallik.Without a lot of pipelines, that crude is moving by rail, and Philadelphia is putting money behind a bet that trend will continue.

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Pennsylvania’s Department of Transportation is contributing $10 million to extend rails to the doorstep of the South Philly refinery.

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