Friday, January 31, 2014

If crude by rail, why not water?

Written by  Bruce Kelly, Contributing Editor
I can’t help but watch the wildfires and water shortages taking place in California and wonder if BNSF and Union Pacific, and perhaps a few of their shippers, are able to respond to this drought with the same urgency with which they’ve answered the call for hauling crude. How many weeks, or months, would it take for BNSF and UP to corral enough tank cars together and set up locations in states with a greater abundance of water where those cars can be filled and then rushed toward California?

Hauling water by train might sound outlandish to most, but tank cars were routinely used during the steam era to transport and store water in railway operating territories where wells, streams, or other water sources were not available. And well into the modern diesel era, tank cars continued to bring drinking water to remote communities or facilities whose only physical connection to the outside world was the railroad.

Supplying enough water to partially refill depleted reservoirs or irrigation systems in areas that are not already served by aqueducts and that are most vulnerable to California’s worsening drought will require something along the lines of a pipeline. Or, where pipelines don’t exist, a rolling pipeline on rails.

In other words, trains moving as many as 100 carloads of water at a time, which translates to roughly three million gallons of water per train. Much the same way that crude by rail is now moving oil across vast distances where previously there was no reasonable or competitive way to do it. Trains cannot possibly move enough water to enough places to fully substitute for a lack of winter precipitation, but they could at least deliver some measure of relief to specific areas facing the worst water shortages. In the broader context, water by rail could even be a seasonal or long-term solution to chronic drought or exhausted groundwater in almost any state or region.

For California, tank cars of non-potable water could be dispersed among cities and small towns, and even to remote locations reached by rail, to keep on hand as back-up for ground-based firefighting equipment. Food-grade tank cars could deliver potable water to specific communities where municipal systems are at immediate risk of running dry, and to select farms that are deemed vital to the nation’s food supply. Supporting water by rail on a widespread, long-term basis would likely require the manufacture of hundreds of new tank cars dedicated to such service.

The crucial value of water has been plainly documented, and sometimes hinted at, throughout human history, from the book of Exodus to the movie “Chinatown” to the U.S. Defense Intelligence Agency’s “Global Water Security” report issued in early 2012. “Water is the oil of the 21st century,” Andrew Liveris, CEO of Dow Chemical, told The Economist back in 2008. That same sentiment has been voiced by other executives, military strategists, and think-tankers from across the social and political spectrum.

So I ask those who are better positioned and educated than I to calculate: What logistical challenges could prevent such an undertaking? How many tank cars can be made available, and when? At what point does the value of water approach that of crude, at least in terms of transporting it in bulk, by rail, across hundreds or even thousands of miles? Is there profit or purpose in rail-hauling water to a state that grows much of the nation’s produce, the same as there’s profit in rail-hauling crude oil that ultimately becomes part of that state’s fuel supply? Can railroads actually haul enough water to be of any meaningful impact?

If it can be done, now is the time to begin working out the details. With California already this dry in January, imagine the desperate situation some areas of the state may be facing this summer. Water by rail will need to already be established and operating by the time that worst-case scenario unfolds. And some are already predicting that scenario might continue for years to come.