Railroads offer crude shippers flexibility

11/19/2012 | Reuters

Railroads are expected to play a larger role in the oil-transportation business in the wake of an expected surge in production due to a frenzy of drilling projects. "Railroads offer the shippers of crude flexibility you just can't get with a pipeline because you have the ability to divert to the exact destination you wish, where the market's the best," said Keith Schoonmaker, a Morningstar analyst. Petroleum shipments have skyrocketed from 11,000 barrels per day in 2007 to 340,000 this year, according to the Association of American Railroads.

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