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Mercer: Restored State Rail Could Connect Chamberlain to Keystone XL

And in other crazily connecting Keystone XL news, Bob Mercer suggests we could see President Obama's latest delay on approving TransCanada's tar sands oil pipeline open the door to an oil-train deal that could enrich Mike Rounds's friends.

On very Good Friday, President Obama said he cannot approve Keystone XL until the Nebraska Supreme Court has had a chance to sort out legal questions over legislation establishing the pipeline's route through that state.

If Nebraska is the monkey in the wrench, TransCanada might want to go around Nebraska. That detour could happen, logically, in South Dakota. Bob Mercer says that detour could involve a South Dakota rail line that friends of oil-friendly Mike Rounds are lobbying to rebuild:

Keystone XL Route through South Dakota
Keystone XL Route through South Dakota
(click to enlarge)

TransCanada’s proposed route through South Dakota would cross the old Mitchell – Rapid City railroad right of way that is owned by the state of South Dakota. The rail line is already rebuilt from Mitchell to Chamberlain. The Legislature this year approved $7.2 million to help pay for rehabilitation of the rail line’s bridge over the Missouri River between Chamberlain and Oacoma — this $1.2 million piece was at the request of Gov. Dennis Daugaard — and to help rebuild the line west to the vanished community of Lyman, where Wheat Growers wants to put a fertilizer distribution and grain shipping complex. That second piece with an appropriation of $6 million came at the request of Sen. Mike Vehle, R-Mitchell.

And for what it’s worth, the public-affairs trio whose firm is running the U.S. Senate campaign of former Gov. Mike Rounds — the former governor’s former chief of staff Rob Skjonsberg, former senior aide Jason Glodt and former state Sen. Bob Gray — also are involved in the effort to put together the money to get the line west to Lyman. It all might be a coincidence, but it’s also worth noting that the former governor’s father, Don Rounds, was a long-time lobbyist for the petroleum industry [Bob Mercer, "Will Oil Trains Be Next for South Dakota?" Pure Pierre Politics, 2014.04.19].

I think re-establishing a cross-state railroad is a fine idea... if only we could include a commuter line so I could ride the rails from Sioux Falls to Spearfish and blog all the way while Casey Jones does the driving. But keep an eye out: one way or another, friends of Mike appear determined to cash in on Keystone XL.


  1. Tim 2014.04.20

    All of this under the disguise of trying to help farmers and ranchers get their products to market. Why does this not surprise me?

  2. Tim 2014.04.20

    Let's just get this straight, Powertechs uranium mining in the southern Black Hills, Daugaards radioactive dump in South Dakota, hauling tar sands oil across the state in trains and maybe a pipeline, reduced regulations on some, if not all, of these ventures. All supported by republicans that keep telling us, "nothing will go wrong, trust us". I think I'll sell my house and move while I still can, after all of this goes wrong, my place will be worthless. After all, who wants to buy in an area where you can't drink the water or breath the air or grow anything. I also have no desire to glow in the dark.

  3. Rick 2014.04.20

    I am interested to know if BNSF already sends oil trains through South Dakota from North Dakota and other oil producing origination points on its lines. It has a main line that crosses a large portion of northern SD entering at Big Stone City and exiting in ND just west of Lemmon.

    A secondary main branch extends south from its Aberdeen terminal, passing through Mitchell on its way south to Sioux City and eventually Lincoln, NE.

    I am skeptical of the Mitchell to Chamberlain line being used to haul oil. It was rebuilt in 2012 but with used jointed heavier rail and used ties. It can handle heavy-loaded grain hoppers but track speed is limited to 25 mph and most of the time trains do not travel that fast on it. I've recently had to sit and wait for a couple of long unit grain trains to pass. It would have been quicker for me to turn round and use another route but it's nice to watch a train pass by on a rail line that has come back to life!

  4. bret clanton 2014.04.20

    The northern line entering at Big Stone City and exiting at Lemmon is a major haul route for frac-sand from Wisconsin. It is off loaded at Gascoyne for transfer to trucks. This is also the same spur where TransCanada has a huge pipeyard.

  5. Joe 2014.04.20

    It is a good idea, would pay for the rail, oil tar sands on rail won't last forever, either refineries will be built closer, or a pipeline will be built sometime. Would pay for the rail, rail would be there forever for the farmers and ranchers.

    I'm not a big fan of a pipeline or tar oil sands, but this would be very good for south dakota. South Dakota is dumb not to refinish this rail all the way to Rapid, whether this happens or not. Tar oil sand trains make rail space a prime location, add in it would be another trans state train, which if they redid it all the way to rapid would be better then the old DM&E line, would pay for it in a hurry.

    I'm a fan of infastructure and if you have a cash cow, milk it until you have gold roads and then use the roads forever.

  6. Lanny V Stricherz 2014.04.20

    This would all make sense as Warren Buffett's BNSF is trying to buy 5,000 heavier, safer rail cars.

  7. bret clanton 2014.04.20

    TransCanadas PUC permit in South Dakota expires in June. Might learn more about things like this when they re-apply?

  8. Lanny V Stricherz 2014.04.20

    Needn't worry Mr Clanton. I am sure that the PUC haa already put the ink in the ink pad to rubber stamp the reapplication as soon as it comes in.

  9. mike from iowa 2014.04.20

    @ Rick

    All I could find for oiltrains through SD

  10. John 2014.04.20

    Want an economic development 2-fer - support building a rail line, preferably Amtrak along the I-90 corridor, through MSP, terminating at Chicago and Jackson or Cody, WY. The 2-fer is hauling commodities (ag & minerals) to the Mississippi and Great Lakes ports while enhancing tourism, especially for SD in the Black Hills. Apparently SD sat on its thumbs and allowed it to be bypassed by Amtrak to the north and south; and the mineral trains momentarily cut through Fall River County as they run from WY to NE and then east. It appears that SD was played for suckers in the most efficient transportation means.

  11. daleb 2014.04.20

    its over 1 million dollars to upgrade a mile of track. To upgrade it to track that can support 55-65mph would probably be 2 million per mile. Sounds good on paper, but might not be so practical. Now with a possible eb5 link to the transcanada project im in favor of just letting it frazzle out. I dont care where their oil goes, its not our problem. Id also point out that our federal government keeps ramping up rules on emissions of all kinds, so investment in energy might not be a good one given current trends in governance. Plus as Daugaard has hinted at in the past, being open to the idea of storing High Level Radioactive Waste, this rail line could be used for this in the future, which im definitely not in favor of either. Take the money he is diverting for this project and give it back to businesses in SD and let them grow.

  12. Donald Pay 2014.04.20

    This is a smart crew of folks commenting here. Upgrading the rail line would most likely be to haul very dangerous high level radioactive waste from the east to a repository in South Dakota. The most likely sites are somewhere out in the Midland, Hayes area, which would require rail upgrades. The area around Edgemont, which has great rail service, is less likely, ironically because of past and potential future mineral development.

    When the failed nuclear Pathfinder Plant near Brandon was decommissioned, they couldn't ship the radioactive waste on rails across South Dakota. The speed limit wasn't the issue, because the load had to go slow anyway. I suspect the issue was the poor quality of the track made the risk of accident much higher.

  13. larry kurtz 2014.04.20

    The radioactive waste will come up the I-25 corridor then up the spur from Dakota Junction, Nebraska. The rail between Rapid and the Missouri River will always be crap because of the Pierre Shale: if the old Milwaukee right of way is ever developed in my lifetime I'll kiss your ass.

  14. Deb Geelsdottir 2014.04.20

    It's interesting that there is a post about trains today. Several oil trains go through MN daily. Today I saw something different. The west bound train pulled orange cars labeled Potash. Could it be fertilizer heading for South Dakota farms?

  15. daleb 2014.04.20

    i heard rumors that the demand for potash far outweights its supply, and people who have prepaid for it wont get all that they bought.

  16. larry kurtz 2014.04.21

    It makes little sense to not use the existing CP east/west line to ship diluted bitumen except that it goes through Pierre and Brookings.

  17. larry kurtz 2014.04.21

    Genesee & Wyoming, the intended buyer of CP, dumped Bakken crude in
    November, 2013.

  18. larry kurtz 2014.04.21

    Why would South Dakota have two state-long east/west freight lines other than to divert traffic from Pierre and Brookings?

  19. larry kurtz 2014.04.21

    The proposed KXL intersects with CP/DME at Philip: why not load there?

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