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Ottawa considers buying rail cars with Alberta to move backlog of crude

Don Horne   


Ottawa is considering a request from Alberta to share the cost of buying rail cars to move an additional 120,000 barrels per day of crude oil from the nation’s oil-rich province, two sources with direct knowledge of the matter told Reuters.

Under the terms of the proposal submitted by the Alberta government last week, the additional rail cars would be in service by October 2019 and would run until some time in 2022, the sources added.

The Alberta government estimates the one-time capital cost of adding extra rail capacity at about $350 million, with the total operating costs spread over three years estimated at about $2.6 billion, the sources said.

The 120,000 barrels per day of crude oil would cover most of the current estimated oversupply.


A spokeswoman for Alberta Premier Rachel Notley would not confirm the details of the proposal, but said the premier has previously said she wanted to add 120,000 barrels per day of capacity.



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