Tag Archives: Pipeline rupture

Dangerous energy gamble: Pipelines vs. rail

Repost from the Washington Examiner
[Editor: One significant quote among many: “In the last five years, 423 oil trains have crashed in the U.S. Since 2010, those crashes have cost about $45 million in damages. In just the first six months of 2015, 31 oil train crashes cost almost $30 million in damages…. It’s 5.5 times more likely that oil will be spilled during rail transport than from a pipeline, according to a study by the Fraser Institute, an independent Canadian think tank. The risk of deaths, injuries and spills are higher with rail and trucks since vehicles can hit other vehicles, they travel through population centers and the drivers can err. None of those factors exist for pipelines.” – RS]

Dangerous energy gamble: Pipelines vs. rail

By Kyle Feldscher, 11/2/15 12:01 AM
Fire burns at the scene of a train derailment, near Mount Carbon, W.Va., on Feb. 16. Fires burned for nearly nine hours after the train carrying more than 100 tankers of crude oil derailed in a snowstorm. (AP Photo/WCHS-TV)

Energy companies increasingly have turned to rail to ship crude oil during the fracking boom, but with train crashes becoming more frequent, they are pushing for construction of more pipelines beyond the Keystone XL.

However, that effort is being stymied by the collapse of oil prices and concerns about pipeline safety.

On Wednesday, Shell announced it would stop construction on a site in Alberta, Canada, that potentially holds 418 million barrels of bitumen oil. The company blamed the project’s expense in a time of cheap oil as well as a lack of pipeline infrastructure.

It’s one example of low prices and lack of pipelines prompting companies to reconsider drilling for oil, especially in the Canadian tar sands, where it’s more expensive to drill. Pipeline transportation is typically cheaper than rail, which costs about $30 a barrel more.

Fifty pipelines have been proposed to the Federal Energy Regulatory Commission this year. They would carry the light, sweet crude from shale regions as well as the natural gas that has helped make the U.S. the world’s energy leader. ”

Because of the costs associated with [rail], it’s going to drive up the cost of oil and it’s going to be significantly higher than pipelines on a per barrel basis,” said Dan Kish, senior vice president for policy at the conservative Institute for Energy Research.

Another calculation oil companies must make is the safety of their highly flammable product.

In the last five years, 423 oil trains have crashed in the U.S. Since 2010, those crashes have cost about $45 million in damages. In just the first six months of 2015, 31 oil train crashes cost almost $30 million in damages, mostly due to a major crash in West Virginia.

It’s 5.5 times more likely that oil will be spilled during rail transport than from a pipeline, according to a study by the Fraser Institute, an independent Canadian think tank. The risk of deaths, injuries and spills are higher with rail and trucks since vehicles can hit other vehicles, they travel through population centers and the drivers can err. None of those factors exist for pipelines.

The August study also found oil and natural gas production is rising faster than existing American and Canadian pipelines can handle. Those pipelines would be even busier if production increased in the Canadian tar sands.

Keystone XL, proposed by TransCanada in 2007, would be able to transport 830,000 barrels per day from the tar sands to the Gulf Coast to be refined. Due to the viscous nature of bitumen oil, it’s much easier to transport it by pipeline than by rail, experts say.

When a train carrying oil derails, it’s often catastrophic.

In West Virginia, oil burned for days after 26 oil tanker cars derailed in February. Nineteen of those cars caught on fire and oil spilled into a nearby river. The damages from that crash totaled more than $23 million.

A train derailment in a Quebec community that killed 46 people in July 2013 prompted calls for better rail safety and led some to question whether to transport highly flammable oil at all.

The State Department estimates rail transportation of oil is responsible for 712 injuries and 94 deaths per year, while oil pipelines are responsible for three injuries and two deaths per year.

“For our society, we have to evaluate the value we place on human life and we should make that a priority,” said Diana Furtchgott-Roth, a conservative economist who is the director of the Manhattan Institute’s e21 program.

“The families of those 46 people killed in Lac-Megantic would have been happy to have less oil and having the lives of their family members back.”

Dangerous derailments led the Obama administration to introduce new regulations to make tanker cars safer. The rule, announced in May, requires improvements to braking systems, making tanker cars thicker and more fire resistant and new protocols for transporting flammable liquids.

The number of crashes steadily increased during the last five years, as more trains shipped crude and natural gas, rising from nine crashes in 2010 to 144 crashes in 2014. But as the price of oil plummeted, the amount of crude oil being drilled and shipped leveled off in 2015, according to the Energy Information Administration.

If drilling in the Canadian tar sands in Alberta were to pick up in earnest, State Department officials believe rail transport would lead to 49 more injuries and six more deaths per year. If that oil were to be moved by the Keystone XL pipeline, there would be one additional injury and no fatalities.

Environmentalists, who have been fighting the Keystone XL, point to the State Department’s finding that pipeline spills are often bigger than those from trains and trucks.

They also point to declining oil use and the collapse of prices as great excuses to leave it in the ground.

Zach Drennen, legislative associate at the League of Conservation Voters, said with oil prices as low as they are, it’s economic folly for oil companies to drill in the Canadian tar sands. Without high oil prices, companies can’t afford to build pipelines. They also can’t afford to ship by rail.

That is why green groups think oil companies could be willing to leave the oil in the earth.

“If you look right now, a lot of oil companies are just deciding that’s not where they want to put their money at,” Drennen said.

To Kish, environmentalists’ goal is to make it too expensive to drill.

“They’re going to try and fight against every damn pipeline they can,” he said, “because if they can choke off production and delay construction of pipelines, it causes disruptions.”

But Ken Green, senior director of natural resource studies at the Fraser Institute, said environmentalists’ dream of keeping oil in the ground isn’t feasible.

“The oil in the ground has a market value and everyone knows what the market value is,” he said. “It’s not hard to calculate that market value … My assumption is sooner or later, that value will be sought.”

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    Santa Barbara oil spill might have been far larger than projected

    Repost from Associated Press
    [Editor:  See also local coverage in the Benicia Herald.  – RS]

    Oil spill might be larger than projected

    By Michael R. Blood, Aug. 5, 2015 4:04 PM EDT
    In this May 21 file photo, David Ledig, a national monument manager from the Bureau of Land Management, walks past rocks covered in oil at Refugio State Beach, north of Goleta. New documents released Wednesday show that the Plains All American Pipeline spill, originally estimated to be around 101,000 gallons, might have been much larger than projected. JAE C. HONG , THE ASSOCIATED PRESS

    LOS ANGELES (AP) — More than two months after oil from a ruptured pipeline fouled California beaches, documents released Wednesday disclosed that the spill might have been far larger than earlier projected.

    Plains All American Pipeline had estimated that the May 19 break along a corroded section of pipe near Santa Barbara released up to 101,000 gallons of crude. The resulting mess forced a popular state park to shut down for two months, and goo from the spill washed up on beaches as far as 100 miles away.

    In documents made public Wednesday, the Texas-based company said alternate calculations found the spill might have been up to 143,000 gallons, or about 40 percent larger.

    The company is continuing its analysis, and the figures are preliminary. Plains All American has hired an outside consultant as part of the effort to reconcile the differences, the documents said.

    At this point, the company considers the methodology used in its initial estimate to be “the most straight forward and accurate calculation.” However, it emphasized the estimate could change as the investigation continues.

    In a statement, Sen. Edward J. Markey, D-Massachusetts, faulted the federal agency responsible for regulating the nation’s pipelines for the conflicting figures.

    “The revelation that the Santa Barbara pipeline spill was much larger than originally thought underscores the importance of our pipeline safety agency providing complete information to Congress and the American people. Unfortunately, the Pipeline and Hazardous Materials Safety Administration’s operational culture has been to withhold information from the American people and Congress,” he said.

    The company has been criticized for taking about 90 minutes to alert federal responders after confirming the spill, even though federal regulations require the company to notify the National Response Center, a clearinghouse for reports of hazardous-material releases, “at the earliest practicable moment.” State law requires immediate notification of a release or a threatened release.

    The cleanup is nearly complete, although the cause of the break is under investigation. The state attorney general and local prosecutors are considering possible charges, and the documents said the U.S. Justice Department is also investigating.

    The company said it’s covering legal costs for several employees who could be questioned by the Justice Department.

    No timeline has been set to restart the pipeline.

    CEO Greg Armstrong told Wall Street analysts in a phone call that the company faced as much as $257 million in potential costs from the break, which includes estimates for cleanup operations, possible legal claims and fines.

    At the end of June, the company said cleanup costs had hit $92 million.

    Wildlife officials reported that nearly 200 birds and more than 100 marine mammals were found dead in the spill area. Investigators have not yet determined what, if any, role the spill played in those deaths.

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      Cause of biggest oil-related spill on land ever in North America – Nexen Energy, Fort McMurray, Alberta

      Repost from Reuters
      [Editor:  See also:  Nexen pipeline may have been leaking for over two weeks.  Also: Alberta pipelines: 6 major oil spills in recent history.  – RS]

      Nexen says may take months to pinpoint cause of Alberta pipeline spill

      By Mike De Souza, Jul 22, 2015 6:40pm EDT

      FORT MCMURRAY, Alberta  –  Finding the root cause of the oil-sands pipeline leak discovered earlier this month in northern Alberta, one of the biggest oil-related spills on land ever in North America, will likely take months, a senior Nexen Energy executive said on Wednesday. Nexen, a subsidiary of China’s CNOOC Ltd, is putting a higher priority on cleaning up the spill from its pipeline and investigating its cause than on restarting the Kinosis oil sands project where the spill took place, Ron Bailey, Nexen’s senior vice president of Canadian operations, said during a tour of the site.

      Bailey said there were about 130 workers doing clean-up and investigation work at the site.

      The leak in the double-layer pipeline spilled more than 31,500 barrels of emulsion, a mixture of bitumen, water and sand, onto an area of about 16,000 square meters (172,000 square feet).

      “We’ve actually shut in everything at Kinosis and our priority is not to bring Kinosis back on production,” Bailey said. “We will be focusing on understanding the root cause of any failure here and the reliability of our systems before we ever start up this system again.”

      The spill site, south of the oil sands hub of Fort McMurray, was detected on July 15 by a contractor walking along the pipeline route. Nexen has not determined when the leak started or why a new state-of-the-art leak detection system failed.

      Bailey said leak likely occurred after June 29, when the pipeline was cleaned with water.

      Nexen executives on Wednesday brought journalists to tour the site, which smells like tar, and where the company was using sound cannons to deter birds and other wildlife from becoming entangled in the gooey emulsion.

      Nexen Chief Executive Fang Zhi personally apologized for the spill on Wednesday, echoing an apology by the company on Friday.

      The Nexen leak was larger than the July 2010 rupture of an Enbridge Inc pipeline that spilled an estimated 20,000 barrels of crude, with some reaching Michigan’s Kalamazoo River.

      The Nexen spill dealt another blow to the oil sands industry in Alberta, which is under fire from environmental groups and aboriginal communities for its carbon-intensive production process.

      Extracting and processing heavy grade oil from the massive oil sands deposits in the Western Canadian province requires large amounts of energy and water.

      (With additional writing by Jeffrey Hodgson; Editing by Peter Galloway)
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        Exxon seeks to use trucks to haul oil after pipeline break

        Repost from KSBW News, Santa Barbara CA

        Exxon seeks to use trucks to haul oil after pipeline break

        Associated Press, Jun 05, 2015 1:06 PM PDT
        Santa Barbara
        Santa Barbara, KSBW

        SANTA BARBARA, Calif. —An oil company wants to use tanker trucks to haul oil through Santa Barbara County while a pipeline that spilled crude into the Pacific Ocean last month is out of commission.

        Exxon Mobil officials have told county officials they want to use a fleet of 5,000-gallon tankers for the job, the Los Angeles Times reported Friday.

        Kevin Drude, head of the county’s energy division, said the company proposes to have trucks use Highway 101 daily, around the clock at a rate of eight trucks an hour to get the oil moving to refineries.

        Exxon Mobil normally moves crude from three offshore platforms through more than 10 miles of pipeline owned by Plains All American Pipeline.

        The movement has been stopped since the pipe ruptured on May 19 and released up to 101,000 gallons west of Santa Barbara. Thousands of gallons flowed down a culvert under Highway 101 and into the ocean at Refugio State Beach.

        The trucking proposal is seen as risky by environmentalists.

        “We don’t want another disaster,” said Linda Krop, chief counsel for the Santa Barbara-based Environmental Defense Center.

        Glenn Russell, county planning and development director, said his staff will review the proposal and make a decision by Monday. He said he expects a similar request from another oil company, Freeport-McMoRan, which has also been affected by the pipeline shutdown.

        Cleanup and investigations into corrosion that resulted in the failure of the pipe have been underway since the spill and there’s no timetable for putting the pipeline back in service.

        Exxon Mobil would use the trucks until the pipeline is operational again, said company spokesman Richard Keil.

        “We need to move our product by truck to serve the energy needs of Californians and the demands of the refineries we supply,” he said.

        Exxon reduced oil production from 30,000 to 8,500 barrels a day and is storing the crude in tanks at Las Flores Canyon near the coast highway.

        Russell said the company now has two weeks’ worth of storage space left.

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