NTX Magazine Volume 4 - Page 26

feature story Railroads “ By 2015, the U.S. will be the single largest producer of oil in the world.” – Dr. Terry Pohlen, UNT Left: More crude oil is being moved by rail with an increase in U.S. domestic energy production. BELOW: BNSF employee. population, not to mention supply and power homes and businesses every day. Railroads carry more than 40 percent of freight in the U.S. by volume – more than any other mode of transportation – and provide the most fuel- and cost-efficient means for moving freight over land. “BNSF is the largest in North America largely because of its geographic network and the western ports. The company is investing $5 billion dollars in capital on top of the 4 billion it invested last year,” said Terry Pohlen, Ph.D., associate professor of logistics and director of the Center for Logistics Education and Research at the University of North Texas. “BNSF is upgrading infrastructure by adding parallel or triple tracks to existing routes, and it is investing in more locomotives and intermodal hubs. Their future is tied to intermodal hubs and energy.” With intermodal transport picking up steam, Pohlen predicts that intermodal rail will replace much of the long-haul trucking business because rail can reduce costs, give great service and allow companies to be more competitive. Tom Harris, president of Alliance Air/Aviation Services with Hillwood Properties, talks about BNSF’s success in its presence at Alliance. “They are an incredibly well-run organization. The BNSF team has done an incredible job over the last 16 years to ensure they are ahead of what’s going on in the industry. They are always improving how they operate their business,” he said. “The 24 www.ntc-dfw.org great news is that they have done very well on the intermodal side of their business. They have a number of yards like the one you see here at Alliance around the country. They are a very well-run organization.” “BNSF is the largest intermodal player because they are able to invest the capital,” said Pohlen. “By being under Berkshire Hathaway, they can focus on the long-term strategic perspective and make decisions that are good for the company and not just make short-term returns for shareholders.” Next Stop Increase in U.S. domestic energy production of crude oil and natural gas has created an increase in crude oil being moved by rail: in 2008, U.S. Class I railroads originated 9,500 carloads of crude oil and, in 2013, that number was a staggering 407,761 carloads. “BNSF is playing an important role in helping the U.S. and North America achieve energy independence by replacing overseas crude oil with fuels being produced from the continent’s vast oil reserves,” Carl Ice, president and CEO of BNSF, noted. “Rail offers producers a more flexible transportation option and gives refiners easy access to premium, domestic fuels.” By 2015, the U.S. will be the single largest producer of oil in the world, said Dr. Pohlen. “Many of the oil fields are not well-served by pipeline,” he said. “Railroads have the ability, capaci- Winter/Spring 2015 ty and flexibility to move with the market, allowing you to redeploy the railcar to another refinery, in case a refinery shuts down due to maintenance or market conditions. If the demand is for a certain product made from crude oil, then railcars can be reconfigured to make that happen – not so with pipelines.” BNSF helped pioneer the modern crude-by-rail option when the first crude oil train left Stanley, N.D., in December 2009. Today, the overwhelming majority of crud B