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Oct 17, 2007 9:55 AM

Continued consumer demand for ethanol and other biofuels is putting pressure on the storage and terminaling sector of the oil and gas industry to handle the subsequent need for storage capacity.

"We are nearing, or at, capacity," said Dave Doudna of Colonial Pipeline at the Platts Refined Products Storage and Transportation conference October 15-16 in Houston TX. He pointed out that fuels like ethanol have to be stored in dedicated tanks, which further takes away capacity for other products.

The biofuel demands have resulted in storage and terminaling managers seeking ways to develop and improve infrastructure to meet the situation--and that's not easy, many of the speakers at the conference agreed. Cost is always a factor in facility refurbishing and new construction, but new construction plans always bring permitting challenges. Another problem arises for ethanol in that it cannot, to date, be shipped in pipelines because of product segregation issues. "We believe it is possible (to use pipelines), but we don't have the solution today," Doudna said. However, he pointed out that similar concerns were raised when ultra low sulfur diesel mandates were introduced, but they were allayed when the industry stepped up to the plate and satisfied the requirements. "It turned out to be a non-issue," Doudna said.

Read more about the conference in upcoming issues of Bulk Transporter.

You also can see other coverage on ethanol in Bulk Transporter online.