All posts by Roger Straw

Editor, owner, publisher of The Benicia Independent

Buckled tracks: heat caused 2 Montana oil train derailments

Repost from the Billings Gazette
[Editor:  Note the industry terminology: “BNSF attributes the July 16 incident…to ‘thermal misalignment,’ also known as sun kink, which occurs when rail tracks expand when heated and buckle.”  …Will we see more of this with global warming?  – RS]

Heat caused Montana train derailments, BNSF says

By Amy Dalrymple, Forum News Service, Nov 4, 2015
Culbertson derailment
Derailed tanker cars lie off track near Culbertson on July 17. The tank cars were hauling fuel from North Dakota and derailed Thursday in rural northeastern Montana, authorities said. Associated Press

CULBERTSON — Two July train derailments in Eastern Montana, including one that spilled 35,000 gallons of Bakken crude, were caused by tracks that buckled in the heat, according to BNSF Railway.

BNSF attributes the July 16 incident that caused 22 oil tankers to derail east of Culbertson to “thermal misalignment,” also known as sun kink, which occurs when rail tracks expand when heated and buckle.

The company also attributes the same cause to the July 14 train derailment about 10 miles west of Culbertson, said BNSF spokesman Matthew Jones.

The Federal Railroad Administration said Tuesday the agency’s investigation into the derailments is still ongoing.

BNSF reported to the FRA that the two derailments caused $3.2 million in damage, including nearly $2 million in equipment damage and more than $1.2 million in track damage.

In the July 16 incident, a westbound train containing 106 crude oil tankers that had been loaded in Trenton, N.D., derailed about five miles east of Culbertson. Twenty-two tankers derailed, with five cars releasing oil, according to information submitted to the FRA.

BNSF and contractors recovered the spilled oil and removed and replaced about 3,900 cubic yards of contaminated soil, Jones said.

On July 14, nine cars on an eastbound mixed merchandise train derailed west of Culbertson, but the cars remained upright and did not cause a spill.

BNSF inspects tracks and bridges more frequently than required by the FRA, including visual inspections and inspections using rail cars equipped with advanced technology, Jones said.

Meanwhile, a legislative audit released last week highlights weaknesses in Montana’s oversight of rail safety, calling attention to a lack of emergency response resources in northeast Montana.

The report by the Montana Legislative Audit Division said the state’s rail safety inspection program is not adequate and first-responders are not adequately trained and equipped to respond to incidents involving hazardous materials.

Northeast Montana does not have a regional hazmat team, primarily due to a lack of hazmat trained and equipped firefighters and the lack of a full-time, salaried fire department, the report said. The closest hazmat team is in Billings, 300 miles from Culbertson.

When a new oil transloading facility in East Fairview, N.D., is at full capacity, Montana may see as many as 40 oil trains each week, the report said.

Montana’s Public Service Commission, which discussed the audit during a meeting Tuesday, would need statutory authority and resources from the state Legislature to expand its oversight of rail safety, said Eric Sell, a spokesman for the agency. Sell noted that the Federal Railroad Administration has primary oversight of rail safety.

BNSF train derailments that were caused by the tracks occurred at a rate of 0.38 incidents per million train miles last year, Jones said, noting the rate is 50 percent better than 10 years ago.

Another recent train derailment involving Bakken crude near Heimdal, N.D., remains under investigation by the National Transportation Safety Board. Six oil tankers derailed and four caught fire in May.

North Dakota Town Moving Forward After Oil Train Derailment, Explosion

Repost from KFYR-TV, Bismarck, ND

Heimdal Residents Move Forward After Oil Train Derailments

By Megan Mitchell, Nov 03, 2015 9:55 AM

Six months ago Heimdal, N.D., made headlines for a oil train derailments. The accident forced the evacuation of the entire town. The National Transportation Safety Board (NTSB) continues to investigation the incident and is focusing on wheel fragments recovered at the scene.

No cause for the crash has been identified at this point.

The NTSB has sent the evidence the collected to a metallurgy testing lab in Washington, D.C. Metallurgists specialize in the physical and chemical behavior of metals. Their examination could take another year to complete. In the meantime, residents of Heimdal have returned to their homes and routines.

Sparky is an affectionate 9-year-old border collie cross. His friendly disposition is second only to the loyalty he has for his owners Arden and Linda Georgensen.

Arden Georgensen is a resident of Heimdal and says the dog never leaves his wife’s side.

“If I can’t find her in the yard I can find the dog. He’s always with her,” Arden said.

On May 6, 2015 neither Linda or Arden could find Sparky when they were forced to evacuate their home without their beloved dog.

“I saw this big plume I thought it was a tornado the way it looked because it was swirling,” Arden said.

An oil train derailed just half a mile from their farm, spewing 60,000 gallons of Bakken crude. That’s when firefighters came knocking.

“They said you need to get out right now ’cause if those tanks explode it’s hard to say what’ll happen out here,” Arden said.

It was a long night wondering whether Sparky would be there when they returned.

Linda went back the next morning and was overjoyed.

“It was a good feeling to see him laying there ’cause when we got home here he was by the door like usual,” Linda said.

Oil production in the Bakken has drastically declined, but tanker trains continue to roll through Heimdal every day. Despite what happened there, residents say they’re not overly concerned when they hear an engine whistle sound.

Curt Benson saw the oil train derail and was the first person to contact emergency management.

“It’s still a concern, but yeah, if you’re only getting five trains a day instead of 20 trains a day sure it’s a little less of a concern,” Benson said.

Other residents aren’t sidetracked by worry.

“You just have that risk. There’s a certain amount of risk just being alive,” Bill Ongstad said.

BNSF is still cleaning up the site, but it appears the landscape around Heimdal is almost restored.

“I have to say they did a pretty bang up job. I think seeing all of them come out here with all the equipment and the time they put in, it certainly makes you feel confident that they probably did a good job,” Benson said.

The 22 residents of Heimdal and Sparky are living in the moment and moving on.

The NTSB said the wheel fragments from the accident were sent to those metallurgy labs two and a half weeks ago.

The agency says they look at everything associated with this accident and no conclusions have been drawn.

Flag as irrelevant

 

Railroad lobbyists winning again, in FRA rulemaking

From an email from Dr. Fred Millar
[Editor:  Millar refers here to an excellent series of articles in the Washington Post, “Deadline for train safety technology undercut by industry lobbying“, “Rail-safety deadline extension hitched to must-pass bill on transit funding” and “Senate passes transportation funding stopgap bill and rail-safety extension“.  Dr. Fred Millar is a policy analyst, researcher, educator, and consultant with more than three decades of experience assessing the risks associated with transporting hazardous materials.  – RS]

Railroad lobbyists winning again, in FRA rulemaking

By Fred Millar, October 28, 2015

This week’s excellent Washington Post reports by reporters Halsey and Laris outlined US railroad lobbyists’ ability to secure a three-year delay in implementing the key railroad safety equipment demanded on the original 2015 deadline by Congress in the Rail Safety Act of 2008.  There is a parallel and highly related story, so far unwritten, on how the railroads and allied interests relentlessly gain even more decisive and long-lasting ways to advantage profits over safety.

Even when Congress roused itself to demand more safety as in the 2008 RSIA, the seemingly permanent Reaganite legacy of “starving the beast” of government regulatory agencies grinds on to render the regulations pitifully weak.  Now the timid and under-staffed Federal Railroad Administration is quietly piddling away the once-in-a-generation opportunity from the 2008 law to impose a significant modern safety improvement regime [already seen in many industries] on the mighty railroads.

The public and Congressional alarm at several high-profile fatal rail disasters that led to the 2008 Rail Safety Improvement Act prompted Congress to include a strong mandate on the Federal Railroad Administration to impose a 20th Century type of Risk Reduction Program regime on the railroads.

This surprising loss by railroad lobbyists in Congress – although they secured some weakening amendments – led to strenuous railroad efforts to prevent the FRA from crafting any strong regulations.  The out-gunned FRA effectively suffered a regulatory failure of nerve, and buried the rulemaking process out of sight for four years, gaining only a weak-tea and partial consensus from railroads and rail labor in FRA’s own ad hoc Working Group of industry insiders.  A couple of ill-attended public hearings drew no public attention.

The resulting proposed rule in 2015 had two major safety-weakening features: first, it gave the railroads a new secrecy pot to hide railroads’ own safety risk information from discovery in court proceedings on railroad negligence.  Trial lawyers, citizens and some officials alarmed about the appalling secrecy already granted to railroads, for example in their decisions to route ultra-hazardous crude oil trains through major cities, filed comments opposing this new secrecy grant.

More importantly, FRA proposed to impose on the railroads only “a streamlined version” of a modern Risk Reduction Program regime.  The comprehensive and robust one mandated by Congress would have required significant new efforts by FRA to approve and oversee railroads’ Risk Reduction Programs, and to ensure compliance.  FRA staffers no doubt felt they were not up to that task, so punted the responsibilities —  to each covered railroad to create its own safety regimes and to decide how to measure their own effectiveness, with no federal guidance.

As FRA then-Administrator Joseph Szabo declared shortly after the Lac-Mḗgantic Quebec crude oil train disaster killed 47 in July 2013,  “The movement of this product is a game changer,” [referring to] the sharp rise in trainloads of volatile crude oil from North Dakota and other places. “We have to rethink everything we’ve done and known in the past about safety.” 

Undermining the most significant Congressional rail safety mandates we may ever see is hardly the new beginning we need.

East coast refineries slash deliveries of Bakken crude oil

Repost from Reuters
[Editor:  Significant quote: “EIA data shows PES imported more than double the amount between January and July, with cargoes from Nigeria, Chad and Azerbaijan.”] 

U.S. oil refiners look abroad for crude supplies as North Dakota boom fades

By Jarrett Renshaw and Catherine Ngai, November 3, 2015 12:52pm EST
Gasoline-making unit at a PBF Energy Inc refinery in Delaware City, Delaware August 21, 2015.  REUTERS/Charles Mostoller - RTX1P4UV
Gasoline-making unit at a PBF Energy Inc refinery in Delaware City, Delaware August 21, 2015. REUTERS/Charles Mostoller

PBF Energy Inc, one of the largest independent oil refiners in the United States, spent heavily in recent years to build the rail terminals at its Delaware City complex that it needed to take delivery of large loads of crude coming from North Dakota’s Bakken oil fields.

But now it is considering eliminating those deliveries altogether, and replacing them with foreign crude imports, according to two sources familiar with the situation. It has even closed its small Oklahoma City office that was only opened in 2013 and had served as a hub for the company’s trading in North Dakota’s oil, the sources said.

The sudden lack of interest in Bakken crude by PBF, which is run by Thomas O’Malley, one of the biggest names in the U.S. oil refining industry, reflects a dramatic recent change in the way East Coast refineries are sourcing the crude that they turn into everything from gasoline to heating oil and jet fuel.

The boom in the output of oil from North Dakota’s shale has ebbed as producers have begun to cut back in the face of the plunge in prices by nearly 60 percent since the summer of 2014.

North Dakota’s Bakken production peaked at 1.153 million barrels per day in June, and had fallen to 1.13 million barrels per day by August, according to state data.

The supply restraint has made Bakken crude relatively more expensive after transport costs than oil shipped from Latin America, the Middle East and Africa, prompting East Coast refiners to return to a foreign crude diet they derided as unprofitable five years ago.

Three companies that resuscitated failing oil refineries on the East Coast less than five years ago with the promise of cheap domestic oil are now looking overseas instead, four sources familiar with the plans told Reuters.

Together, PBF, Philadelphia Energy Solutions Inc and Delta Airline’s Monroe Energy are expected to cut their Bakken crude intake to the lowest levels since 2013, according to two oil traders who are familiar with East Coast rail arrangements.

PES, which bought a 335,000 barrel-a-day Philadelphia refinery that was slated for closure in 2012, has slashed its Bakken deliveries to just 17 trains in November from a peak of 100 trains a month during the summer, according to two sources familiar with the plant’s operations.

The planned deliveries mark the lowest monthly volume since the company built a new rail terminal to take advantage of the Bakken revolution. EIA data shows PES imported more than double the amount between January and July, with cargoes from Nigeria, Chad and Azerbaijan.

LOCKED INTO PAYING

The price of Bakken hasn’t fallen as much as other oil, nearly wiping out the entire $6 a barrel discount to the U.S. benchmark that it traded at in January and sending refiners scrambling for other sources. Meanwhile, a glut of other crudes has made importing – including transport costs of $2 to $3 a barrel – much more attractive.

Because bringing crude by rail from North Dakota to an East Coast refinery usually costs about $10 to $11 a barrel, without a deep discount for the oil, moving it across the country becomes unprofitable. As a result, Bakken crude is used in the U.S. Midwest and Canada where lower transportation costs make it a profitable option.

East Coast refineries accounted for about 10 percent of nationwide imports of crude in July, according to the latest data from the U.S. Energy Information Administration. That is expected to rise as the Bakken shipments fall further, analysts and traders say.

PBF had poured over $50 million into upgrading its Delaware City rail terminal and signed long-term volume commitments to unload at least 85,000 barrels per day from trains at a fixed $2 a barrel cost, regardless of whether it takes the oil. As a result, the company is locked into paying $170,000 a day.

In a conference call late last week, PBF disclosed that it is only budgeting to take 25,000 barrels a day of Bakken oil delivered by rail at its East Coast refineries in 2016.

The company’s spokesman Michael Karlovich said in an email that the company was transferring its single employee in the Oklahoma office to its headquarters in New Jersey, but declined to provide additional detail about the company’s Bakken strategy.

PBF’s Delaware City refinery imported about twice as much crude in July as in January, bringing in cargoes from Colombia and Peru, according to data from the U.S. Energy Information Administration. The company’s Paulsboro, New Jersey, refinery increased its imports by 50 percent in the same period.

PES declined to comment on the shifting crude slate, while Monroe Energy did not respond to requests for comment.

The refiners had previously found that relying on crude from the likes of Colombia, Mexico and Saudi Arabia was unprofitable. But now it may be different provided Bakken crude remains relatively expensive and the U.S. economy doesn’t head into a downturn.

That’s because the refiners are buoyed by increased U.S. fuel demand, partly because of the low oil prices. In 2010, demand was shrinking.

Additionally, they are supported by the closure of underperforming refineries in the Atlantic Basin during the last downturn. And then there is the current availability of deeply discounted crude oil from overseas.

“They are looking for the lowest cost supplies,” said Sandy Fielden, an analyst with RBN Energy. “A few years ago, that was North Dakota, but not today.”

(Reporting By Jarrett Renshaw and Catherine Ngai; Editing by Jessica Resnick-Ault and Martin Howell)