It’s a fact: Oil is black gold in Texas. The oil and gas industry plays a major role in the Texas economy. Information from the Texas Oil and Gas Association suggests that the state’s oil and gas industry contributed $13.8 billion to the state’s tax revenue in 2015, and has contributed toward schools, roads and other critical funds. With oil and gas playing such a huge role in the state’s economy, it is no surprise that the businesses behind the industry are thriving and booming. This makes oil and gas logistics part of the equation, too.
Oil and gas logistics in Texas is big business. Oil and gas companies face many challenges in logistics, including scale, complexity, visibility and safety and compliance. From FERC (Federal Energy Regulatory Commission) rules to warehousing, there is much to consider. Solutions for oil and gas logistics include supply chain management, base-to-base logistics and more. Oil and gas are among the most valuable commodities in the world and oil and gas logistics can be complex to manage.
Oil and gas logistics is a complicated process. The oil and gas supply chain has many links. Moving oil and gas can take special equipment, safety procedures and regulatory compliance. Logistics services in the gas and oil industry require both visibility and urgency, and the right logistics partner can help you make sense of this complex process.
There are many moving pieces to oil and gas logistics in Texas. Activities like trucking and warehousing drive logistics operations, and this means tankers and trucks of oil and gas regularly move across Texas highways. Many 3PL providers leverage extensive experience in chemicals and hazardous materials to apply their expertise to the oil and gas supply chains.
The history of oil and gas logistics in Texas dates all the way back to the 1800s. Back then, oil and gas logistics depended on railroads to move products across the country. Because the railroads that moved oil were owned by a few companies, many feared a monopoly. This prompted the U.S. Government to create the Interstate Commerce Commission.
Today oil and gas logistics focuses on providing transportation services and more to this booming industry. The right partner can provide your business transportation and logistics services including:
Oil production in Texas is booming. In fact, daily crude oil production in Texas makes up for up to 40% of U.S. total. This adds up to millions of barrels per day. The fastest growing oil production region in the country is located in the Permian Oil Basin Region of West Texas and New Mexico.
Texas oil production is good news for consumers. Relying on domestic energy sources gives consumers more choices. It also means more reliable energy sources and less dependence on foreign sources. Texas oil production can help drive costs down and give consumers more flexibility for energy needs.
The Permian Oil Basin region extends over 86,000 miles, with many remote areas. This expansive region produces nearly 3.5 million barrels per day. This is more oil than can travel in a pipeline, so producers must rely on rail cars and trucks to keep the Texas oil supply chain moving.
When thinking about the Texas oil supply chain, it’s important to think about how far the product must travel. The oil supply chain process begins at the pump and at the oilhead and ends at the pump at the retail gas station. It is also important to know that crude oil itself has no value -- it’s what refiners turn it into that makes it valuable.
The Texas oil supply chain has several links:
There are two main transport modes for crude oil delivery in the Texas oil supply chain:
Pipeline transport takes crude oil from the wellhead to the refinery. There is an interstate grid of oil pipelines, which transports ⅔ of all oil produced. The U.S. actually has the largest network of oil pipelines in the world. Pipeline is the cheapest way to transport oil.
Even though the pipeline network is expansive, truck transport is still necessary. About ⅓ of all oil produced is transported from the wellhead to refinery via truck. A truck can transport, at most, about 200 barrels per load, which is equal to about 8,400 gallons, according to information from Penn State’s College of Earth and Mineral Sciences.
Oil and gas transportation is big business. Oil and gas moves via pipeline, barge, rail and trucks. The trucks used to haul oil and gas products are called tankers.
In most cases, tanker trucks are used for short-distance hauls of oil and gas. Trucks can carry oil in all forms, from crude sweet oil to gasoline ready to go to the pump at your corner station. Tanker trucks can even deliver fuel straight to the consumer. You might see tanker trucks transporting oil to a gas station when you fill up your car. You might find that tanker trucks offer the most cost effective way to get fuel from the refinery and to consumers. This is because most gas stations and retail outlets aren’t connected to railways or barge canals.
Most tanker trucks are equipped to carry between 400 and 8,400 gallons of fuel or oil.
If you’re looking for a partner to help transport oil and gas products, R+L Global Logistics is prepared to offer assistance. With 99 percent on-time delivery, our logistics solutions can get you moving from the pump at the oilhead to the pump at the gas station.
Oil and gas logistics in Texas doesn’t have to be a hassle. With experience transporting all kinds of freight, from moving truckloads of California wine to seasonal produce to tankers of milk and dairy products, R+L Global Logistics is ready to get you on the road and to your final destination. Rely on R+L Global Logistics’ experience in oil and gas logistics in Texas to get your freight from pump to pump. Contact R+L Global Logistics today.
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