CHICAGO An Enbridge Inc.
subsidiary has formed a joint venture with Canopy Prospecting
Inc. to develop rail capacity that would deliver crude oil from
the Bakken shale in North Dakota to refineries in
Enbridge Rail (Philadelphia) LLC
and Edgemont, Pa.-based Canopy will together create Eddystone
Rail Co. and related pipeline and storage infrastructure near
Philadelphia, the two companies said Monday.
Enbridge, which will hold a
75-percent stake in the joint venture, estimated total capital
costs of about $68 million and predicted the project would be
in service by the third quarter of 2013, pending regulatory and
"Rail is the fastest way to
provide increased export capacity out of the Bakken, creating a
near-term solution to transportation bottlenecks," Enbridge
Inc. liquids pipelines president Stephen J. Wuori said in a
The Bakken shale, which
underlies North Dakota and parts of Canada, has seen a boom in
oil drilling, but pipeline infrastructure has been slow to
catch up to the relatively new energy play. That has resulted
in more rail, instead of traditional pipelines, being used to
take oil away from the region to consumption hubs elsewhere (
amm.com, June 12).
The Eddystone project will also
help boost U.S. employment by bringing domestically produced
crude oil to "once idle or under-utilized" refineries in the
eastern half of North America that have historically dependent
on "more expensive foreign imports," Wuori said.
The Philadelphia area is second
only to Houston in crude oil refineries, and Eddystone will be
among the largest rail suppliers of North Dakota Bakken crude
to the area, Canopy president Jack Galloway said in a
statement. "Eddystone will be the first to provide access
directly to those refineries from a rail facility."