Rail said sufficient to deliver North Dakota crude oil

May 16, 2013 at 6:04 AM

BISMARCK, N.D., May 16 (UPI) -- There's enough rail capacity to get crude oil out of North Dakota even though the state continues to set production records, the state's oil commission said.

Director of the North Dakota Industrial Commission Oil and Gas Division Lynn Helms said early spring storms in the state meant oil and natural gas activity was slower than expected for the first part of 2013.

"Operators are gradually picking up the pace as summer weather begins while continuing to push higher efficiency and cost cutting measures," he said in a statement.

The NDIC published its March report on oil and natural gas development. The state set all-time records with more than 782,000 barrels of oil per day, 846,000 cubic feet of natural gas per day and 8,634 producing wells.

Regional oil companies are turning more to rail deliveries as the U.S. oil production boom strains existing pipeline capacity.

"Crude oil take away capacity continues to be adequate as long as rail deliveries to the coasts keep growing," Helm said.

The Association of American Railroads said crude oil delivery by rail continues to set volume records. The U.S. Energy Department said rail shipment of petroleum and petroleum products is more expensive than pipelines but generally offers energy companies a greater degree of flexibility of destination points.

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