BNSF says it can handle more crude-by-rail shipments if Dakota pipeline is shut

By Devika Krishna Kumar and Stephanie Kelly

NEW YORK (Reuters) – BNSF, the railroad unit of Warren Buffett’s Berkshire Hathaway Inc, is prepared to handle any increase in rail traffic if the Dakota Access oil pipeline (DAPL) is shut due to an ongoing legal dispute, the company told Reuters.

The operators of the 570,000 barrel-per-day line, led by Energy Transfer LP, have been locked in a battle to keep the line open after a federal judge last year scrapped a key permit and ordered an environmental review of the line. A U.S. District Court could issue a ruling as early as May on whether the line can stay open during the review.

Any closure of the line would divert most crude production in the region onto railcars and create transportation bottlenecks.

BNSF operates the greatest number of route-miles in North Dakota, the second-biggest oil producing state in the country and leading producer of agricultural products such as wheat and canola.

“We are confident in our ability to handle additional volume across our Northern Corridor, whether it comes from more agricultural products, consumer goods or industrial products, including energy,” spokeswoman Lena Kent said in a statement late Thursday.

The other major railroad serving the region, Canadian Pacific Railway Ltd, did not immediately respond to a request for comment.

Before DAPL began operations in 2017, the booming Bakken shale basin relied on rail to transport barrels, which is typically more expensive than pipeline shipments. Volumes spiked, creating congestion on the railroads.

In 2014, BNSF invested more than $1 billion toward maintenance and expansion projects in that region, where the railway serves agricultural and energy customers, to alleviate congestion.

“A shutdown of the pipeline would be easily accommodated and would not adversely affect the movement of other products that move on our railroad,” Kent said.

(Reporting by Devika Krishna Kumar and Stephanie Kelly in New York; Editing by Marguerita Choy)

Derailed BNSF fuel train fire in Texas nearly extinguished

(Reuters) – A BNSF Railway Company train carrying products including coal and gasoline to Houston in Texas was still burning on Wednesday, a day after it collided with a truck near Cameron, causing an explosion in gasoline-carrying carriages.

BNSF, owned by Berkshire Hathaway Inc and one of the largest railroad operators in North America, had said on Tuesday that 13 of the train’s 110 carriages were derailed, with five of those carrying gasoline.

Five other carriages carrying non-hazardous loads were also on fire, the company added, forcing an evacuation of the surrounding area.

“Local first responders and BNSF personnel are still on site, working to completely extinguish the flames,” BNSF, one of the largest railroad operators in North America, said in a statement.

The train crew and truck driver were not injured, BNSF said, adding it would assess the damage and plan a clean-up once the fire was fully doused.

The fire is expected to be extinguished on Wednesday, the Cameron fire department said.

“It’s not completely out, we’re still putting water on it,” said fire department chief Henry Horelica.

The accident is the second incident since 10 BNSF Railway carriages carrying crude oil derailed, with three catching fire, in Custer, Washington, in late December.

The Texas-based company did not respond to a request for further comment and it was not immediately clear what companies would be affected by the delay in shipments.

BNSF is one of the largest U.S. coal carriers.

The region is already contending with an unprecedented power crisis caused by brutal cold weather and any fuel delays could further pressure the state’s electricity grid operator, which uses natural gas, coal and other fuels to power generators.

(Reporting by Asha Sistla and Swati Verma in Bengaluru; Editing by David Goodman)