New assessment captures value of prolific Bakken crude production at the nexus of both pipeline and rail takeaway capacity
May 3, 2016, Houston, TX – Genscape launched a daily price assessment for Bakken crude located in the most evolved trading hub in North Dakota. The Beaver Lodge hub is situated between wellhead production and pipeline and rail transportation access from the Williston Basin, the producing basin for Bakken crude. Genscape’s Bakken Beaver Lodge assessment aims to transparently represent the value of the incremental Bakken barrel with this transportation optionality.
The Bakken spot market is comprised of two main modes of takeaway capacity: crude-by-rail and pipeline. Crude-by-rail emerged in 2009 as a way to send land-locked production to destination coastal markets. Since, pipeline capacity from the Bakken region has expanded substantially. North Dakota producers seek flexibility in sending barrels to market, using pipeline capacity as a first option and rail in times of arbitrage incentive.
While a Bakken crude spot market developed over the last five years at Clearbrook, MN, (junction between Enbridge’s North Dakota Pipeline system and the Enbridge mainline system), Clearbrook is removed from the producing basin, and has only pipeline connectivity. Genscape’s Bakken Beaver Lodge assessment is poised to represent the value of the spot barrel as close to the wellhead as possible, with flexibility for these multiple transportation options.
“A pricing benchmark has yet to take hold in the Williston Basin, despite the ample Bakken crude production levels coming from the region. Genscape’s new Bakken Beaver Lodge provides a reference price that is reflective of the incremental Bakken barrel’s value at the most evolved trading hub in the Williston Basin,” said Suzanne Evans, Director, Products and Pricing Assessments Development.
The Bakken Beaver Lodge assessment, which was assessed for the first time on Monday, will be published daily in Genscape’s PetroRail Daily Bakken Update publication, and weekly on Tuesdays in the PetroRail publication, alongside pertinent regional pipeline flow and crude loading data. Genscape provides insight into the entire North American crude oil landscape with data and market intelligence that follows the supply lifecycle from forecasted production to transportation on rail, pipeline, and ships, to its delivery at key refineries or storage facilities.
Genscape recently published a white paper, Beaver Lodge: A Bakken Crossroads, which explains how the hub offers takeaway optionality for the evolving North Dakota market. To read the full paper, please visit: www.genscape.com/beaver-lodge.
To view the full press release, visit: Genscape Launches Crude Oil Daily Price Assessment for Bakken Crude at Beaver Lodge, North Dakota
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