Shipping Oil on Great Lakes Won’t Be Happening
Calumet Specialty Products, based out of Indiana, has scrapped its $20 million dollar plans to ship oil via freighters on the Great Lakes. The company’s plans were to build an oil terminal in Lake Superiors to serve as a transfer station for the constant oil shipments coming in from the western U.S. and Canada to tankers heading towards eastern refineries. “As domestic production of crude oil from unconventional shale plays… continues to increase, so too will the need to identify the safest, most reliable methods by which to transport crude oil to our nation’s refining centers,” said Noel Ryan, a Calumet spokesman.
Calumet is the owner of what used to be Murphy Oil refinery, and is Wisconsin’s only oil refining company. The Enbridge pipeline system carries oil to Calumet for processing into fuels such as gas and materials to make black-tops, but the pipeline is clogged with too much oil shipments coming in and can’t keep up. Even shipping by rail isn’t enough – Makers of rail cars aren’t able to roll more cars out fast enough to stay afloat and the new pipeline project is routinely faced with new delays from environmental concerns.
The plan for the Superior terminal was to be a temporary fix to get more oil moved in and out, until the pipeline can get back on track. “Given a lack of sufficient pipeline and rail capacity to transport crude oil from northern production fields to key refining centers, this project has received significant indications of interest from our customers,” Calumet said in a statement. But the company kept hitting snags.
Earlier this year, the Wisconsin Department of Natural Resources (DNR) denied a permit for rebuilding the waterfront in the area where Calumet planned to build their transfer station because of “harbor fill” details. Without support from eastern refineries, the company retracted their application for an air permit from the Wisconsin DNR and decided to “go in a different direction.”
Kollin Schade, Calumet’s plant manager, said, “We always said the project depended on getting a partner, preferably on the customer side of things, and that just didn’t happen. There was some interest … but no one would commit. He continued, “I guess you never say never. But that window appears to have passed and we’re not directing any resources toward it.”
Environmentalists criticized the idea from the get-go, stating that the threat of damage to the ecology was greater than the advantages of transporting oil over the lakes. Lyman Welch, water quality program director of the conservation group Alliance for the Great Lakes, addressed cleanup concerns. “A spill in the open waters of Lake Superior would be very difficult if not impossible to clean up,” Welch said. “Tar sands crude oil is heavier than water, so much of it sinks to the bottom of a river or lake water body if there is a spill.” The Coast Guard reported it was not currently capable to clean-up a heavy crude spill in the deep waters of the lake, since much of the crude would sink to the floor.
Schade said the refinery will carry on normal day to day operations, “but we’re always looking for new projects, especially the opportunity to move away from a fuels focus into specialty products.