Bauer Business Focus

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Mark Reichman | July 12, 2013

Published on July 10, 2013

Mark Reichman, director of research at Simmons & Company, stopped by Bauer Business Focus recently to discuss how the events from the tragedy in Quebec may affect rail transportation for crude oil.

On Bauer Business Focus — A conversation on pipeline versus rail transport for crude oil with Andrew Schneider, business reporter for KUHF 88.7 FM.

On July 6, 73 tanker cars derailed in a Canadian town, flattening dozens of buildings in Lac-Megantic’s historic downtown and leaving over 60 people dead or missing. As the investigation continues, the advantages of transporting crude via railroad are being debated.

Mark Reichman, director of research at Simmons & Company, stopped by Bauer Business Focus recently to discuss how the events from the tragedy in Quebec may affect rail transportation for crude oil.

“I think the train accident has raised some questions in the public’s mind on the method of railroads transporting crude,” Reichman said. “Canadian crude oil supplies are dependent on rail movements, and if regulatory constraints develop, limiting rail movements, it could lead to logistical constraints for Canadian crude oils.”

While the outcome of this incident remains to be seen, the need to ship crude by rail is increasing, according to Reichman.

“I think both rail and pipelines have excellent safety records for transporting crude oil,” Reichman added. “The growth that we’ve seen in terms of volume shipped over rail is relatively new, and it remains to be seen how the railroads can adequately handle that volume.”

Click here to hear the full interview.

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