Sacramento Bee: Benicia plans more study of crude-oil train impacts

Repost from The Sacramento Bee
[Editor: The Bee presents a good summary of uprail critiques of Valero’s plan, quoting City staff, Valero and the CEO of the American Petroleum Institute.  Note that organized local opposition has also been strong and persistent.  – RS]

Benicia plans more study of crude-oil train impacts

By Tony Bizjak, 02/03/2015
In this July 24, 2014 file photo, an investigator photographs the scene where a locomotive and cars carrying crude oil went off the track beneath the Magnolia Bridge in Seattle.
In this July 24, 2014 file photo, an investigator photographs the scene where a locomotive and cars carrying crude oil went off the track beneath the Magnolia Bridge in Seattle. Mike Siegel / AP Photo/The Seattle Times

A controversial proposal by the Valero Refining Company in Benicia to run two 50-car crude-oil trains a day through Sacramento and other Northern California cities to its bayside refinery has hit another slowdown.

Benicia officials on Tuesday said they have decided to redo some sections of an environmental impact analysis of the project. The city plans to release a rewritten report June 30 for public review and comment over the summer.

The city’s decision comes after numerous groups, including Sacramento leaders, state Attorney General Kamala Harris and state oil spill prevention officials, called Benicia’s review of the project inadequate.

Those critics said Benicia failed to analyze the potential impacts of an oil spill and fire in cities, waterways and rural areas along the rail line, and also did not analyze the project’s potential impacts east of Roseville in environmentally sensitive areas such as the Feather River Canyon. They also challenged Benicia’s assertion that an oil spill between Roseville and Benicia would be a once-in-a-111-year event.

Crude-oil rail shipments have come under national scrutiny in the last year. Several spectacular explosions of crude oil trains, including one that killed 47 in a Canadian town in 2013, have prompted a push by federal officials and cities for safety improvements.

Sacramento and Davis leaders have called on Benicia to require the Union Pacific Railroad to give advance notice to local emergency responders, and to prohibit the railroad company from parking or storing loaded oil tank trains in urban areas. Local officials want the railroad to use train cars with electronically controlled brakes and rollover protection. Sacramento also has asked Benicia to limit Valero to shipping oil that has been stripped of highly volatile elements, including natural gas liquid.

Valero officials had said they hoped to begin receiving crude oil by trains early this year. In an email to the Bee, Valero spokesman Chris Howe said, “The proposed steps (by Benicia) are part of the process which we expect will allow the city to grant us a use permit for the project.”

In a hearing Tuesday in the U.S. House of Representatives in Washington, D.C., Jack Gerard, the president and CEO of the American Petroleum Institute, lamented that lengthy reviews were holding up the development of the country’s energy resources, including the Keystone XL pipeline, which has been under review by the State Department for seven years.

Gerard said some opponents were turning the process into a referendum on fossil fuels. “What we’re seeing across the country today is there’s a small group of individuals who are using permitting processes and infrastructure as surrogates to stop economic activity that they disagree with,” he told the House Subcommittee on Railroads, Pipelines and Hazardous Materials.

Vallejo Times-Herald: Benicia will update crude-by-rail project’s environmental report

Repost from The Vallejo Times-Herald

Benicia will update crude-by-rail project’s environmental report

By Irma Widjojo, 02/03/15

Benicia >> The City of Benicia announced Tuesday that staff will be updating sections of the draft environmental impact review report for Valero Benicia Refinery’s proposed crude-by-rail project.

“There’s a requirement that if we’ve identified any issues that might have new significant impacts we would have to circulate the report,” interim Community Development Director Dan Marks said.

Marks said staff has identified one to two of those issues, and is still reviewing the public comments received after the draft report was initially released in June. However, he did not release any specifics of the identified issues, citing ongoing review.

Marks said the updated sections are set to be recirculated June 30, at the earliest. The public will then have 45 days from the release date to submit any comments on the updates.

“This is a scheduling announcement,” he said. “We’re still working on it. It’s going to take a while.”

The initial report states that the controversial project would have “significant and unavoidable” air-quality impacts within the Sacramento basin because of emissions from oil trains traveling to and from the refinery. However, the project would result in “no impact” or “less-than-significant” impacts locally to biological resources, cultural resources, energy conservation, geology and soils, greenhouse gas emissions, hazards and hazardous materials, water quality, land use and planning and noise, the report finds.

If approved, the proposed project would allow the refinery to bring two 50-tanker car trains of crude oil in and out of Benicia every day, replacing crude shipments by boat.

Valero Crude By Rail DEIR – sections to be recirculated, released June 30, 2015

Repost from City of Benicia, CA – Valero Crude By Rail
[Editor: Not surprisingly, we will need to wait a few more months while the City’s consultants respond to the overwhelming critical comments on the first Draft of Valero’s EIR.  Thanks to all who wrote or spoke at Planning Commission hearings.  We will keep you informed when the comment period opens on the Recirculated document.  Note that once again, the City is scheduling only the minimum 45-days for comments on the RDEIR.  – RS]

Valero Crude by Rail UPDATE:

Valero_Crude_by_Rail-Project_Description_March_2013_(cover_page)The City has reviewed all of the comments submitted on the Draft EIR and has determined that sections of the Draft EIR will need to be updated and recirculated.  The anticipated release of the Recirculated Draft EIR for public comment is June 30, 2015.  The Recirculated Draft EIR will have a 45-day comment period.  After the comment period on the Recirculated DEIR closes, the City will complete the Final EIR which will include responses to all comments on the original Draft EIR and the Recirculated Draft EIR.

Troubles in Boomtown: Low Prices Raise Alarm in North Dakota Oil Patch

Repost from ABC News (AP)

Low Prices Raise Alarm in North Dakota Oil Patch

Feb 2, 2015, By Matthew Brown, AP

WATFORD CITY, N.D. — High crude prices catapulted North Dakota into the top tier of the global oil market and doubled or tripled the size of once-sleepy towns that suddenly had to accommodate a small army of petroleum workers.

But now that those prices have tumbled, the shifting oil market threatens to put the industry and local governments on a collision course. Farming and ranching communities that committed to building homes, roads and schools for the swelling population are worried about how they will pay for those improvements as oil-related tax revenue evaporates.

“Everyone is asking the same question: ‘Holy cats, where do we go from here?'” said Dean Bangsund, an economist at North Dakota State University who has tried to help oil-rich McKenzie County gauge its needs, with an eye toward balancing growth against revenues. But none of his economic models were pessimistic enough to match how low oil prices dropped.

For now, the oil extraction goes on. Despite the price plummet, drilling remains profitable in the heart of the state’s Bakken oil patch, due to the sheer volume of crude flowing from so-called hot-spots.

And so the building continues in Watford City, a century-old town that once marked the end of the line for the Great Northern Railroad. Roughly 60 rigs are drilling in surrounding McKenzie County — 40 percent of the rigs statewide. New neighborhoods and retail centers creep ever deeper into former wheat fields.

“We’re making a new, 15,000-person city in the middle of a pasture,” said Brent Sanford, mayor of Watford, the county seat. “The question is if we get money put into the pot to do it.”

The county, which a decade ago had a population of about 5,000, has become a magnet for “man camps,” where newly arriving workers and their families live in trailers, RVs and just about any other structure that can stand up to North Dakota’s whipping winds.

The pace of growth over the past decade has been “hyperventilating,” slackening only slightly as oil prices have fallen, Sanford said. “You can’t catch a breath.”

With oil prices hovering near $100 a barrel for most of the past four years, ambitious plans were laid out to transform the city from a chaotic, sprawling crash pad for transient workers into a larger, more livable community. Sanford and other local leaders drafted a long wish list — more housing, more schools, better roads, a new water treatment plant and expanded law enforcement.

Developers eager to cash in started construction of thousands of apartments and single-family homes. A new high school and civic center began to take shape. A new bypass was built to the south of town to ease traffic jams.

Then oil prices began to drop, falling to roughly $50 a barrel now.

Daniel Kuo, vice president of a Chinese-backed real estate company that’s building a 2,000-unit housing complex on the outskirts of Watford, keeps a close eye on oil prices. He’s met with McKenzie County economic-development agents to soothe any worries that the company might pull back.

“You’re in too deep to let a price blip derail you,” Kuo concluded at the end of one meeting. He shared the optimism expressed by Sanford and many others in Watford that oil prices will stabilize and the boom will resume.

Leaders in the North Dakota Legislature have pledged to keep public-works improvements as a priority. Whether that’s sustainable depends on how long oil prices stay down. Oil and gas revenue forecasts for the state already have dropped $4 billion, reducing earlier projections by roughly half.

Watford and McKenzie County have joined other western North Dakota counties in seeking help from the state. Politicians and business leaders from the region flocked to the Capitol in Bismarck to press the Legislature for a larger stake of what’s left of the oil revenues.

Towns like Watford are worried about getting saddled with all the downsides of the boom — dangerously crowded roads, overtaxed utilities, jam-packed schools and unchecked growth — without the financial means to impose order.

“At this point, it’s like downtown Seattle,” said Aaron Pelton, who owns Outlaws’ Bar and Grill along Watford’s main thoroughfare. “If you can’t come to a small community and have a quality of life, what do you have?”

Like many oil towns, Watford has endured the boom-bust cycle before. Oil was first found in McKenzie County in 1952. Within a decade, hundreds of workers had moved on.

Another boom kicked off in 1976, with up to 100 wells a year being drilled until prices started plummeting four years later.

In the last decade, the industry refined the hydraulic fracturing, or fracking, technology that allows drillers to pull oil out of rocky shale. The fracking rush has seen more than 11,000 wells drilled, and analysts predict a total of 50,000 to 60,000 before all the oil is gone. Industry observers expect the wells already in place to sustain last year’s production level of 1.1 million barrels a day at least through 2015.

Still, the sudden drop in prices caught most observers off guard and shook confidence in the boom.

“If I could tell everybody that we’d have $70 oil in 2016, we could breathe easier,” said Gene Veeder, director of the McKenzie County Job Development Authority.