Tag Archives: Lynn Helms

Maclean’s: So it turns out Bakken oil is explosive after all

Repost from Maclean’s Magazine

So it turns out Bakken oil is explosive after all

Producers in North Dakota’s Bakken oil fields have been told to make crude is safer before being shipped by rail
By Chris Sorensen, December 10, 2014

Oil TrainsAfter years of insisting oil sucked from North Dakota’s Bakken shale wasn’t inherently dangerous, producers have been ordered to purge the light, sweet crude of highly flammable substances before loading it on railcars and shipping it through towns and cities across the continent.

State regulators said this week that the region’s crude will first need to be treated, using heat or pressure, to remove more volatile liquids and gases. The idea, according to North Dakota’s Mineral Resources Director Lynn Helms, wasn’t to render the oil incapable of being ignited, but merely more stable in preparation for transport.

It’s the latest regulatory response to a frightening series of fiery train crashes that stretches back to the summer of 2013. That’s when a runaway train laden with Bakken crude jumped the tracks in Lac-Mégantic, Que., and killed 47 people in a giant fireball. In the accident’s immediate aftermath, many experts struggled to understand how a train full of crude oil could ignite so quickly and violently. It had never happened before.

Subsequent studies have shown that Bakken crude, squeezed from shale rock under high pressure through a process known as hydraulic fracturing, or “fracking,” can indeed have a high gas content and vapour pressure, as well as lower flash and boiling points. However, there remains disagreement about whether the levels are unusual for oil extracted from shale, and whether the classifications for shipping it should be changed.

Still, with more than one million barrels of oil being moved by rail from the region each day, regulators have decided to err on the side of caution and implement additional safety measures. For producers, that means buying new equipment that can boil off propane, butane and other volatile natural gases. Under the new rules, the Bakken crude will not be allowed to have a vapour pressure greater than 13.7 lb. per square inch, about the same as for standard automobile gasoline. Regulators estimate that about 80 per cent of Bakken oil already meets these requirements.

The industry isn’t pleased. It continues to argue that Bakken oil is no more dangerous than other forms of light, sweet crude, and is, therefore, being unfairly singled out. It has also warned that removing volatile liquids and gasses from Bakken crude would result in the creation of a highly concentrated, highly volatile product that would still have to be shipped by rail—not to mention additional greenhouse-gas emissions. It goes without saying that meeting the new rules will also cost producers money—at a time when oil prices are falling.

In the meantime, regulators on both sides of the border are taking steps to boost rail safety by focusing on lower speed limits, new brake requirements and plans to phase out older, puncture-prone oil tank cars. Earlier this year, Transport Minister Lisa Raitt said Canada would be “leading the continent” on the phase-out of older DOT-111 tank cars, which have been linked to fiery crashes going back 25 years. There are about 65,000 of the cars in service in North America, about a third of which can be found in Canada.

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    First person account: New Bakken volatility standards are pointless

    Repost from The Star Tribune, Minneapolis/St. Paul MN
    [Editor: Author Lisa Westberg Peters writes with a personal style that is engaging and informative: “I’ve seen Bakken crude oil as it comes out of the ground. It was surprising in several ways: It was almost green, quite fluid and downright fizzy with natural gases. It’s the high gas content that makes Bakken shale oil so explosive.”  – RS]

    New Bakken volatility standards are pointless

    Lisa Westberg Peters, December 15, 2014
    The explosion risk still exists, which emboldens pipeline supporters — but why must our choices be so dismal?
    A large swath of Lac-Mégantic, Quebec, was destroyed and 47 people were killed in July 2013 when a train carrying Bakken crude oil derailed, sparking several explosions and forcing the evacuation of up to 1,000 people. Photo: Paul Chiasson • The Canadian Press/AP

    I’ve seen Bakken crude oil as it comes out of the ground. It was surprising in several ways: It was almost green, quite fluid and downright fizzy with natural gases. It’s the high gas content that makes Bakken shale oil so explosive.

    When the state of North Dakota established new limits on vapor pressure last week for the oil shipped out of the state, my first reaction was relief. Flammable liquids with lower vapor pressures are less volatile. We’ve seen several explosive rail accidents in recent years involving Bakken oil; an oil train derailment last year in the small Quebec town of Lac-Mégantic killed 47 people and flattened its downtown. I was pleased that regulators were addressing this problem.

    But when I took a closer look at the numbers, I felt more dismay than relief. Even if oil producers exceed the regulators’ demands — and regulators say they often do — Bakken crude will still be explosive.

    The appropriate comparison seems to be gasoline.

    Lynn Helms, head of the North Dakota Department of Mineral Resources, said the new vapor pressure standard of 13.7 pounds per square inch (psi) would make Bakken crude no more volatile than the gasoline we put in our cars every day.

    In March, an investigation by the Transportation Safety Board of Canada concluded that the Bakken oil in rail cars at Lac-Mégantic was “as volatile as gasoline,” but the vapor pressure was measured at 9 to around 9.5 psi. In other words, the Bakken crude that exploded in Lac-Mégantic was less volatile than what North Dakota regulators are demanding now, and it still exploded.

    In a New York Times article last week [North Dakota Regulators Tell Producers to Filter Crude Oil of Flammable Liquids], Clifford Krauss reported: “Once the rules are in force early next year, transported North Dakota crude oil will have a similar volatility to that of automobile gasoline, which should decrease the risk and size of any fire that might occur once a rail car is punctured in an accident, according to state regulators.” His story never mentioned the findings of the Canadian government.

    Why wasn’t this New York Times reporter more skeptical of the assurances of North Dakota oil regulators, especially after the recent New York Times revelations about the leniency of regulators toward the oil industry?

    The new vapor pressure standard announced last week is pointless. We will still face danger from exploding oil trains.

    This disturbing fact tends to encourage pipeline supporters. Pipelines are safer, they say. In the past, oil transported by pipelines has tended not to explode and kill people; instead it spills and contaminates streams, lakes and aquifers. If you value people’s lives over clean water supply, in the short term, pipelines seem better.

    But why do we have to make such lousy choices to keep our domestic energy boom rolling — to keep workers working and our dream of energy independence alive? Let’s do everything we can to encourage the other domestic energy boom, the wind and solar boom, that has already begun and that survives today despite many obstacles, including national policies that still encourage fossil fuel, yesterday’s energy source. If we were to place a price on carbon tomorrow, we would not need as many pipelines and we would be able to reduce the number of oil trains passing through our neighborhoods.

    Climate experts urge us to leave much of the world’s remaining fossil fuel, including Bakken crude, in the ground. If we do as they advise, we will disrupt job markets and be forced to rethink the way we do almost everything. Why should we voluntarily face such disruption? One very good reason: We already face the prospect of pervasive disruption posed by a changing climate. It’s far preferable to take well-designed and systematic measures to control disruption than let disruption control us.

    Lisa Westberg Peters is the author of “Fractured Land: The Price of Inheriting Oil” (Minnesota Historical Society Press, 2014). She lives in Minneapolis with her family.
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      North Dakota debating new vapor pressure standards

      Repost from The Jamestown Sun, Jamestown, ND
      [Editor: The proposed ND vapor pressure standards seem rather lax to my inexpert eyes.  See comparative Reid Vapor Pressure (RVP) levels mentioned in an August 9 posting here on BenIndy: “On June 2nd Quantum Energy met with OIRA and presented a simple three-page presentation. The presentation explains how regular crude oil has a Reid Vapor Pressure (RVP) of 5-7 psi and Bakken crude has an RVP between 8-16 psi. To put that in perspective, gasoline typically has a RVP of 9 psi.”  The proposed new standard in North Dakota according to this article is a “vapor pressure limit of 13.7 pounds per square inch.”  – RS]

      Oil industry has ‘significant concerns’ about crude conditioning standards

      By STATE/REGION on Nov 14, 2014

      BISMARCK — North Dakota oil regulators said Thursday they want more input before approving new standards for removing volatile gases from crude oil before it’s shipped by rail, a proposal an industry representative warned could devalue Bakken crude and contribute to more flaring at well sites.

      Department of Mineral Resources Director Lynn Helms presented the state Industrial Commission with the proposed standards, part of a national effort to improve oil-by-rail safety in the wake of several explosive oil train derailments.

      Helms said the standards would result in Bakken crude “behaving even better than the unleaded gasoline that you put in your cars.”

      Attorney General Wayne Stenehjem, who serves on the commission with Gov. Jack Dalrymple and Agriculture Commissioner Doug Goehring, said the department is “on the right track” with the proposed order. But he wanted more time to sort through it and allow for public comment.

      Dalrymple agreed, called it “an excellent working draft” and a “very robust system of verification” for making sure Bakken crude falls within vapor pressure standards before it’s loaded onto the rails.

      The commission said it would accept comment on the proposed order until 5 p.m. Wednesday and hold a special meeting by Dec. 11 to consider approving it so the standards can take effect Feb. 1.

      Helms said the proposed order strengthens the existing rule by requiring well sites to use a gas-liquid separator and/or a heater-treater to remove so-called “light ends” like butane and propane from crude oil, and mandating the equipment be operated at certain temperatures and pressures.

      He estimated 80 percent of existing wells in the Bakken and Three Forks formations would be able to produce oil within the proposed vapor pressure limit of 13.7 pounds per square inch.

      National standards recognize oil with a vapor pressure of 14.7 psi or less to be stable, and winter blend gasoline has a vapor pressure of 13.5 psi, he said.

      Helms said the average vapor pressure of Bakken crude across several recent studies was 11.8 psi, though “there were significant outliers.”

      “We really believe that the vast majority of our Bakken crude oil will already fall well below the standard,” he said.

      The roughly 15 percent of wells that operate outside of the temperature and pressure standards would have to hire a third party to test their crude for vapor pressure and submit the results to the state within 15 days. Operators looking to use alternative methods for conditioning or stabilizing their crude would need commission approval after a hearing process.

      The proposed order also would ban the practice of blending crude oil with light ends or liquids recovered from gas pipelines before the oil is sold. Dalrymple noted violators can face fines as high as $12,500 per day.

      “I think we want to be sure that that’s clear for everybody,” he said.

      North Dakota Petroleum Council president Ron Ness cautioned that the standards could devalue Bakken crude by requiring it to be over-treated, at the same time contributing to natural gas flaring by removing more gas at the wellsite.

      “I think we have some pretty significant concerns,” he said, adding the Industrial Commission is “getting into the nitty-gritty details of how companies manage their commodities.”

      Helms said preliminary figures show 24 percent of the gas produced at North Dakota wells in September was burned off. Flaring reduction standards approved by the commission in July will lower the allowed flaring rate to 23 percent on Jan. 1, 15 percent by 2016 and 10 percent by Oct. 1, 2020.

      The proposed oil conditioning standards will make it more challenging for producers to meet those flaring goals, Helms said.

      “We’re pushing at both ends of the system, so we’re making life really difficult for these people right now. But it’s got to be safety first,” he said.

      A Wall Street Journal article on Wednesday questioned the accuracy of the testing method used in a Petroleum Council-funded study of Bakken crude’s volatility, and Stenehjem asked Thursday whether the Industrial Commission should conduct its own study.

      “It has been questioned, simply because it was the industry that conducted it,” he said.

      Helms urged the commission to support an ongoing U.S. Department of Energy study that could involve the Energy & Environmental Research Center in Grand Forks.

      Ness said it’s concerning that “the focus is all back on the commodity.”

      “The root of the issue is the trains and the train tracks and the accidents,” he said.

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        North Dakota to Require Producers to Treat Crude Before Shipping

        Repost from The Wall Street Journal

        North Dakota to Require Producers to Treat Crude Before Shipping

        Move Comes Amid Growing Safety Concerns About Oil-Laden Trains

        By Chester Dawson, The Wall Street Journal, Nov. 13, 2014

        Reuters
        Reuters

        North Dakota plans unprecedented steps to ensure crude pumped from the state’s Bakken Shale oil producing region is safe enough to be loaded into railroad tank cars and sent across the country.

        In the first major move by regulators to address the role of gaseous, volatile crude in railroad accidents, the North Dakota Industrial Commission, which regulates energy production in the state, said it would require Bakken Shale well operators to strip gases from crudes that show high vapor pressures.

        “We believe the vast majority of our Bakken oil will fall well below the standard,” Lynn Helms, director of the state’s Department of Mineral Resources, said at a news conference.

        The proposed state rule will require all operators to run crude oil through equipment that heats up the crude and forces out gases from the liquid. An estimated 15% of current producers without such equipment will have to submit quarterly test results showing their wells don’t exceed the state’s proposed 13.7 pounds a square inch vapor pressure limit, Mr. Helms said.

        Those changes could make the new rules more costly for the state’s smaller producers. Jack Ekstrom, vice president of government affairs for Whiting Petroleum Corp. said the rules don’t appear to be “a major material cost” he said. “This is perhaps more of a concern to a marginal or smaller operator.”

        A representative for the North Dakota Petroleum Council, an industry lobbying group, criticized the proposed rules for “micromanaging the industry,” and said they could lead to unintended consequences such as increased burning of excess natural gas at well sites.

        The proposal also would prohibit blending condensate or natural gas liquids back into crude and require rail loading terminals to inform state regulators of any oil received for shipment exceeding the vapor pressure limits, Mr. Helms said.

        He said the new rules would cost industry, but not enough to make drilling Bakken oil uncompetitive.

        Scott Skokos, an organizer with landowners’ group Dakota Resource Council, called the move by the regulator “a step in the right direction.”

        The state’s decision follows months of officials’ playing down the possibility that Bakken crude was more volatile and could explode more readily than other North American crudes.

        Several oil trains have derailed and exploded since 2013, spurring concern about the safety of growing numbers of oil-carrying trains delivering oil produced by the shale boom.

        ‘…a step in the right direction.’

        —Scott Skokos, Dakota Resource Council

        The Wall Street Journal reported in February that Bakken crude contained several times the amount of combustible gases as oil from elsewhere. Relying on an analysis of data collected at a pipeline in Louisiana, the Journal pointed out that oil from the Bakken Shale had a far higher vapor pressure, making it much more likely to emit combustible gases, than dozens of other crude oils.

        The proposed rules specify how wells should treat the oil to ensure it is “in a stable state,” according to Mr. Helms.

        Executives from the top oil companies working in the Bakken Shale told state regulators in a September hearing that their crude is safe to transport by train using existing treatment methods, opposing potentially costly requirements that they make the oil less volatile before shipping it.

        But studies by the U.S. and Canada have indicated that Bakken crude is more volatile than other grades of oil. Industry-funded studies, including one commissioned by the NDPC, have said Bakken oil is no different than other types of light oil.

        The state expects to issue final rules by December 11th.

        Production of light shale oil through hydraulic fracturing has soared, accounting for most of the additional three million barrels a day of oil that the U.S. produces today compared with 2009. Much of that is shipped to refineries by railcars, especially crude produced from Bakken Shale due to the area’s few pipelines.

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