" avoid long term commitments to pipeline operators."
Thats the key statement. example California refineries are trying to take advantage of bottlenecked oil such as Bakken which is coming in by rail, and are refusing to bite the bullet and setup something more permamnet.
Kind of screws the consumer and the refineries don't care since they just pass the costs onward. In the long run it will bite the refineries, since they are juggling supply and over the long haul pipelines are cheaper.
if you dig ito Kinder you will find that they also benefit from rail transport of oil (except I don't remember the details)
Nine hours ago I raised an important concern regarding KMP's future. I hoped to get valid feedback. Since then Johnson_Bruce has made 34 nonsenical posts. Please sell KMP if you are so upset! It's pretty simple.
It is way more expensive to transport via rail. Rail is being used where no pipelines exist. It is also easier to get started since the track exist and no government approval is required. But if there is a pipeline no rail option is viable. If a pipeline is being built rail will be the looser.
I understand it is much more costly, but when special interests and various concerns block new pipeline routes then it becomes necessary. After the keystone pipeline was blocked, producers gave up on waiting and then shipping by rail along that route increased.
I tried to find the article to see if costs were discussed ... could not find it. But I did find many similar articles. Yes, it is more expensive to ship by rail.
For a good discussion check out this June 13, 2013 article in BloombergBusinessWeek titled "Amid US Oil Boom, Railroads Are Beating Pipelines in Crude Transport". It mentions a pipeline proposed by KMP between Texas/LA that was recently canceled.