Oil industry taking over railways - KSFY News - Sioux Falls, SD News, Weather, Sports

Oil industry taking over railways

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One state's fortune is causing problems for its neighbors. North Dakota's oil is monopolizing regional rail capabilities, leading to a crisis for grain producers in South Dakota. Locomotives are making their way to oil fields in North Dakota instead of grain elevators here in South Dakota.

Industry leaders say farmers have paid their dues to the railroad for nearly a century, and not they're being undercut by the oil boom.

It's not the cars there is a shortage of, it's the lack of engines needed to pull these cars.

"We pay the money, but we don't get the engines. They pay the money, and they do get the engines," Wilmot farmer Orrie Swayze said.

There are not enough engines and crews to transport grain, and this leaves a large amount of product with nowhere to go. This has also sparked a bidding war between grain elevators and ethanol plants, doubling the cost of freight. Possibly even a bigger problem though, is the inability to transport fertilizer.

"Fertilizer facilities are all full today, but they typically turn them 2 to 5 times a year, so they need to have rail service to be able to refill that facility within a matter of days. When it goes empty during spring planting season, if we can't get service out of the railroad, there's no way to get their product in here to refill," Pierre farmer Pat Tracy said.

Thursday Co-Founder of the SD Corn Growers, Dennis Jones, will be in Washington D.C. at the Surface Transportation Board's hearing proposing solutions to the crisis. He will be requesting that President Obama issue an executive order requiring the BNSF Railroad to bring the needed crews, locomotives and equipment to the upper plains in order to move harvested grain.

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