TSX:CUS.DB.D - Post Discussion
Post by
ocean112 on Feb 22, 2015 8:18pm
PS
Per previous posts and previous article - unit train economics is still attractive. Shipping by pipeline is $7-11 a barrell - but producers receive WCS prices. Unit train is $11-12 per barrel but they can receive WTI prices by shipping to different markets not accessible by pipeline. As long as WCS/WTI spread remains above $12 a barrell - (currently $13.7 a barrell) - unit train can provide higher netbacks (by $1.7 a barrell) relative to pipeline. At $12/barrell - unit train and pipeline provide the same netbacks. My bet (based on inventories) is that WTI/WCS spreads will widen over time increasing unit train netbacks relative to pipeline.
Manifest business (with unit costs between $17-21 a barrell - is pretty much toast with current WTI/WCS spreads.
That said - NATO is still an attractive play not likely lost by midstream and the one producer still bidding on NATO.
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