Pipelines can now handle all of the current Bakken crude production

Jun 6, 2017

State mineral resources director Lynn Helms (l) and state pipeline authority director Justin Kringstad (r).
Credit Dave Thompson / Prairie Public

A milestone for North Dakota Pipeline Authority director Justin Kringstad.

For the first time since he began that job – in 2008 – there is enough pipeline capacity to take the current production of Bakken crude to market. A substantial amount of crude has been shipped by rail – but that percentage has been reduced as more pipeline capacity comes on line.

The Dakota Access Pipeline is now operational – and is to carry 520,000 barrels of oil a day.

But Kringstad said oil will still move by rail.

"I don't believe anyone has the expectation that crude oil movement by rail will go away completely," Kringstad said in an interview. "We'll likely see some of that oil go by rail to the coastal markets."

Kringstad said the market itself will drive those decisions of where the barrels of Bakken crude will be marketed.

"But over the long term, we will see higher percentages of oil by pipeline," Kringstad said.

Kringstad said this will also spur some competition – meaning there will likely be less of a premium to ship oil by rail.