Oil back on tracks as pipelines swamped

HOBBS, N.M. (KRQE) - There is a definite oil boom in southeastern New Mexico. So much crude is being shipped, the oil industry is having to turn back the clock 30 years when oil last road the rails.   

Residents in Lea County should expect to see a lot more trains rolling through.

"It's all hands on deck, moving the trains as fast as we can move them," said Superintendent Kurtis Lindsey of the Texas-New Mexico Railroad.

For the first time in at least 30 years, the TNMR is shipping crude oil from the Permian Basin.

"Underground pipelines in the region here, they're at capacity, and the next viable alternative is to ship it by rail," explained Lindsey.

Around 1930, tracks were laid to get oil out of the area, but underground pipelines have been sufficient -- until now.
     
Railroad oil shipments started this past month, which means more good news for the booming oil industry which is boosting the Lea County economy.

"It's doing great," Lindsey continued.  "We've brought on 15 new employees in the operations department, eight employees in the mechanical department and maintenance, and just doing our part to contribute to the local economy here."

Lindsey said before the recent oil boom, in 2010 they shipped under 4,000 carloads on the TNMR. This year they're on track to ship 21,000, which is increasing business by more than five times.   

Previously, trains would run once a week shipping oil industry-related loads such as scrap metal and sand. Now, they're running five days a week spanning the 105 miles from Lovington to Monahans, Texas.

To date, Lindsey said they've invested roughly $15 million into the improving the railroad. If business continues like this, it could bring millions to the railroad, much of which would be used to improve conditions and efficiency of the rails.

"The more trains that we need to run with crude oil and frac sand and everything else to help out the oil industry here, is going to be more jobs, and more money coming in from the railroad side of things to the local area here," said Lindsey.

Right now the railroad is shipping about 30 carloads of oil a week, and they expect that number to grow.