Effective September 1, Harvest Midstream’s Sacagawea Pipeline in North Dakota is offering a temporary Volume Incentive Program for uncommitted shippers moving crude from Keene and/or Johnson’s Corner to their Palermo rail terminal. Shippers that average more than 10,000 bpd in a month pay $1.05/bbl on all eligible barrels, a cut of 25–28% from previous uncommitted rates.
Sacagawea is a bidirectional Bakken crude system running from the Watford City area of McKenzie County, across the Missouri River / Lake Sakakawea and the Fort Berthold Reservation, and north toward Stanley (see figure below). It connects Bakken barrels to Dakota Access Pipeline at Johnson’s Corner, Enbridge’s North Dakota Pipeline near Stanley, and Palermo rail terminal. Recent data show Palermo railing Bakken crude west to Phillips 66’s Ferndale refinery, BP’s Cherry Point refinery, and Marathon Petroleum’s Anacortes refinery. In June, shipments from Palermo to those three destinations averaged ~46,000 bpd, or about 30% of typical Bakken rail shipments.
The tariff change looks like a competitive move: keep the Palermo rail route viable for Bakken barrels headed to Washington refineries and compete with other Bakken rail terminals for those same barrels. Diesel prices have risen in recent months, and those increases typically immediately flow through into crude-by-rail rates, weakening rail economics.
Bakken crude coming into Washington by rail competes with Canadian light oil flowing down Trans Mountain’s Puget Sound pipeline, which usually runs full (see below), and with light oil marine imports, typically from South America. Both of those alternatives have less direct exposure to diesel prices than crude-by-rail. Lower gathering and pipeline rates on systems such as Sacagawea can offset some of that rail-cost pressure, help Palermo hold its place against other Bakken loading terminals, and keep the Bakken-to-Washington rail path in the money.
Flow/Transaction Updates and New Assets Under Coverage
Plainview has over 400 assets with crude oil throughput or transactional data on our platform and continues to add more each week. Data for existing assets under coverage are posted as soon as they become available. Below are the assets that were updated this week or newly added to coverage.
