His Burlington Northern is the highest volume coal hauler in the country.
And despite his comments on the Keystone XL pipeline "I’m not an expert, but it certainly seems like it makes sense to me," "There are an awful lot of pipelines running in the United States and net, they've certainly been a huge plus for the country" he's moving a lot of oil that would have had to compete with XL oil had it been approved. Burlington hauls 75% of North Dakota's oil.
Warren Buffett and Carl Icahn are reaping the benefits of surging demand for railroad tank cars to haul shale oil from beyond the reach of existing pipelines.
Buffett’s Union Tank Car Co. is working at full capacity and Icahn’s American Railcar Industries Inc. (ARII) has a backlog through 2014. Trinity Industries Inc. (TRN), the biggest railcar producer, began converting wind-tower factories last year to help meet demand for train cars that can transport the petroleum product.
All three are getting a boost from a shale-oil boom that’s poised to make the U.S. the world’s largest crude producer by 2020. Rail carloads of crude tripled last year to more than 200,000, and demand for tanks designed for it soared, helping both Trinity and American Railcar outstrip the Standard & Poor’s 500 Index.
“People who want to ship oil can’t get them,” Toby Kolstad, president of the consultant firm Rail Theory Forecasts LLC said, referring to railcars. “They’re desperate to get anything to move crude oil.”And another look at MidAm's strategy, also from Bloomberg:
The shortage is exacerbated by makers who are keeping many of the tank cars they produce to supply their own leasing businesses, where rates in some cases have more than quadrupled to $2,500 a month. The manufacturers also are wary of boosting production too much and getting caught with unsold cars as they did in an earlier coal boom.
Rail shipping has become the method of choice at new production sites because obtaining permits and rights-of-way can slow pipeline construction and make it more costly, said Brad Delco, an analyst with Stephens Inc. in Little Rock, Arkansas....MORE
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