Ethanol demand prompts rail yard expansion
January 4, 2007
Motiva Enterprises LLC, a fuel refiner, distributor and marketer, plans to expand its rail yard in Sewaren, N.J., according to Barry Schaps, general manager for Portfolio Planning and Strategy, which will handle the construction project. The project, which was in the permitting phase at press time and expected to be completed sometime in 2007, was needed to handle the growing demand for ethanol. "Essentially what we are going to do is double the railhead capacity that exists today and boost that up to be able to receive a unit train up to 100 cars long," Schaps told EPM.
The rail yard at Sewaren, a refined products terminal, is already the single-largest receipt point for ethanol on the East Coast. With the expansion, it will be able to receive more ethanol, and do so in a more efficient and low-cost manner, Schaps said.
From the Sewaren rail terminal, ethanol can be moved by barge to high-demand areas on the East Coast, such as Connecticut, Rhode Island, New York and as far south as Baltimore. "It's a key shipment hub for ethanol," Schaps said.
The concept of using ethanol unit trains is becoming more widely accepted with the growth of the ethanol industry. Both ethanol producers and the railroad companies have been supportive of the expansion project. "This wasn't something we dreamed up on our own," Schaps said.
Using a dedicated ethanol unit train to shuttle the product from ethanol plants typically located in the Midwest to high-demand markets is more efficient. A unit train should be able to make the round trip from its point of origin and back again in less than a week, Schaps said. Further, some estimates show that utilizing a unit train could reduce shipping costs by as much as 50 percent. "That is a much more efficient means for transporting ethanol not only from the consumer perspective, but also from the producer perspective," Schaps said.
Motiva, a joint venture of Shell and Saudi Refining Inc., is headquartered in Houston. The company refines and markets gasoline for about 7,600 Shell-branded service stations.
The rail yard at Sewaren, a refined products terminal, is already the single-largest receipt point for ethanol on the East Coast. With the expansion, it will be able to receive more ethanol, and do so in a more efficient and low-cost manner, Schaps said.
From the Sewaren rail terminal, ethanol can be moved by barge to high-demand areas on the East Coast, such as Connecticut, Rhode Island, New York and as far south as Baltimore. "It's a key shipment hub for ethanol," Schaps said.
The concept of using ethanol unit trains is becoming more widely accepted with the growth of the ethanol industry. Both ethanol producers and the railroad companies have been supportive of the expansion project. "This wasn't something we dreamed up on our own," Schaps said.
Using a dedicated ethanol unit train to shuttle the product from ethanol plants typically located in the Midwest to high-demand markets is more efficient. A unit train should be able to make the round trip from its point of origin and back again in less than a week, Schaps said. Further, some estimates show that utilizing a unit train could reduce shipping costs by as much as 50 percent. "That is a much more efficient means for transporting ethanol not only from the consumer perspective, but also from the producer perspective," Schaps said.
Motiva, a joint venture of Shell and Saudi Refining Inc., is headquartered in Houston. The company refines and markets gasoline for about 7,600 Shell-branded service stations.
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