Gov. John Hoeven and petroleum industry leaders gathered in the state Capitol for a press conference Tuesday to detail expanding pipeline and railway capacities to move the state's increasing supply of oil in light of a potential bottleneck.

Lynn Helms, the director of the state's Department of Mineral Resources, said short-term projects such as increased railway transportation and drag reducing agents in the Butte pipeline should relieve growing pressure on the state's oil transport system.

"This is complex stuff," Hoeven said. "It's important to do it right."

Transporting oil by rail car costs about $15 per barrel, where as moving it through a pipeline costs about $3 per barrel, Helms said.

Rail tank car facilities were built in Dore, Stampede and Ryder in August and another near Minot that opened this week to meet increasing demand.

The Minot facility will increase capacity by 30,000 barrels per day and the other three by about 11,000 to 17,000 barrels per day.

The future of North Dakota's pipeline capacity was a cause for concern at a recent congressional field hearing in Bismarck last month, chaired by Sen. Byron Dorgan, D-N.D.

At the hearing, Harold Hamm, CEO of oil producer Continental Resources, said the state is facing a "severe" problem because oil production has outpaced the means to move it.

Since that hearing, Helms said North Dakota's oil industry has stepped up to add additional capacity.

"For the most part, our crude oil is moving just fine at this point," Helms said. "Rail capacity is going up to fill that short term need."

Enbridge Pipeline is expected to expand its pipeline capacity by 51,600 barrels per day in 2010, bringing its total capacity to 161,000.

Democratic gubernatorial candidate Tim Mathern said in a Tuesday press statement that Hoeven hasn't shown leadership in expanding the state's pipeline capacity.

"All we got from John Hoeven today was a press conference with fancy charts," Mathern said in the release. "That doesn't move us one inch closer to solving this problem."

Hoeven spokesman Don Canton said he didn't want to "dignify the statement with a response."

(Reach reporter Brian Duggan at 223-8482 or brian.duggan@bismarcktribune.com.)