More ethanol-to-crude rail facility conversions unlikely in California: analyst
Orlando, Florida (Platts)–24Mar2014
More conversions of California ethanol rail unloading terminals to crude service are unlikely, following Kinder Morgan’s switch of its Richmond, California, unloading facility, an analyst said Monday.
“The other big [ethanol] terminals aren’t as close to refiners, and there is a limited amount of ethanol capacity,” Stillwater Associates President David Hackett said on the sidelines of the American Fuel and Petrochemical Manufacturers Annual Meeting in Orlando, Florida.
Kinder Morgan late last year converted the terminal to crude service from ethanol service “after changes in the ethanol market made it attractive for us to look to other commodities,” spokeswoman Melissa Ruiz said Monday in an email.
The Richmond terminal is the only 100-car unit train crude-by-rail facility in California, she said.
“In order to handle crude oil, we had to file a new application with the Bay Area Air Quality Management District (BAAQMA) for permits, which we received last summer,” she said. “We began handling crude this past September, and the facility will serve Bay Area refiners.”
The terminal is located on the Burlington Northern Santa Fe rail yard in Richmond. The railed crude is trucked from the terminal, she said, noting that there are no pipelines or tank connections involved.
Ruiz declined to comment on the terminal’s current throughput or on which types of crude are received by the facility.
The rail terminal conversion comes after the leading US midstream company early last year scrapped its high-profile proposed Texas-to-California Freedom Pipeline on a lack of customer interest. The pipeline would have delivered 277,000 b/d of crude from the Permian Basin in West Texas to northern and southern California refining complexes.
Kinder Morgan said at the time that it would focus on providing crude-by-rail options for West Coast and Texas shippers.
Along the West Coast, refiners and midstream companies are planning to construct crude-by-rail unloading terminals, but are facing permitting delays opposition.
If California “doesn’t get crude by rail, their competitiveness will erode,” Hackett said during the Platts Barrel Talk panel discussion at the conference. “We do see some uptick in rail deliveries, but there is a lot of opposition to crude by rail in California with the environmental community.”
In her background materials and in the resolution, Vice Mayor Maio made the extraordinary claim that Phillips 66 was seeking a permit to ship extreme crudes by rail from “Donner Pass, through Auburn, Rocklin, and Roseville, proceed along the Sacramento River through Sacramento and Davis to Benicia and along the San Francisco Bay through Martinez, Richmond, Berkeley, Emeryville, and Oakland. From Oakland the trains would use the Coast Line via Hayward, Santa Clara, San José, Salinas and continue along the Pacific Coast into San Luis Obispo County.”
Railroads are notably secretive about routing of hazardous materials, so I asked Maio to clarify exactly how she determined that these crude oil trains would pass through Benicia and across the 85-year-old Benicia rail bridge (built in 1929) to Martinez, along the Carquinez Strait and down through the East Bay.
Vice Mayor Maio asked her “subject matter expert,” Dr. Phyllis Fox, to be in touch, and below is her detailed and I think rather conclusive explanation. It looks like Benicians are facing not only the offloading of 100 train cars of crude each day, but another 100 cars passing through on tracks shared by Amtrak.The following is by Phyllis Fox, Ph.D, PE, BCEE, QEP, Environmental Management, Rockledge, Florida:
I’m the subject matter expert that ferreted out the route of the Santa Maria trains for the CBR Berkeley Resolution.
The DEIR fails to disclose the route the trains will take from their entrance to California to San Jose, a fundamental flaw in the DEIR. However, there are important clues.
First, the DEIR on p. 4.12-7 suggests the Mulford line out of Oakland to Santa Clara would be used. The only way to get to Oakland is through Richmond and Berkeley.
Second, on p. 4.12-22, the DEIR notes “However, north of San Jose through the Bay area there are areas of multiple mainline tracks, and a large number of commuter trains. Therefore, it is unclear how much the crude oil unit train would overlap with the Coast Starlight. Given this uncertainty, the EIR has limited the analysis to the Coast Line.” (e.g., the DEIR only discusses the route from San Jose to Santa Maria, leaving the reader to guess which East Bay cities will be affected.) The implication is that any route with capacity is fair game.
Third, throughout the DEIR, interference between “commuter” trains and the crude unit trains is discussed. See, e.g., Sec. 4.12. The Union Pacific Coast Starlight line is apparently a key option. Figure 4.12-3 shows it passes through Richmond, Berkeley, Oakland, and down the East Bay.
Fourth, finding no clear statement in the DEIR as to the East Bay route, I did an exhaustive survey of railroad maps. This work indicates that rail lines go either: (1) down the Central Valley, roughly parallel to I-5, or through Benicia, Richmond, Berkeley, Oakland, and down the East Bay. There is no connection between these two routes except for the Altamont Corridor Express or ACE commuter line from Stockton, over the Altamont Pass into Livermore, Pleasanton, and Fremont. See: http://en.wikipedia.org/wiki/Altamont_Corridor_Express. The ACE line would be an unlikely choice given the challenges posed by the Altamont Pass in handling unit trains with 80+ cars weighing up to 18,000 tons that are a mile long. The line has significant operating limitations including limited capacity, single track for much of the route, slow average operating speeds, and service limitations. Further, the line alarmingly, passes through the Niles Canyon, which also contains the Hetch Hetchy Aqueduct, carrying the water supply for San Francisco. The DEIR is silent on the ACE line. Thus, the only route that appears viable, coming from northern California, is through Sacramento (Roseville), the refinery towns and into Berkeley, Oakland etc. The most likely route is from the northern part of CA, as both Bakken crude and tar sands crude come from the far north and will most likely be sent first west into WA or OR into northern California or through Reno.
There are no other connecting rail lines between the Central Valley route and the East Bay. Thus, by process of elimination, I (and others who did similar analyses) concluded the most likely route is through the East Bay.
Regardless, the DEIR does not restrict the route. Thus, any route can be used, so the East Bay cannot be eliminated.
Richmond and Berkeley Oppose Fracked Oil and Tar Sands Rail Shipments
Jean Tepperman — Wed, Mar 26, 2014
The city councils of both Berkeley and Richmond unanimously passed resolutions last night calling for tighter regulation of the shipping of crude oil by rail through the East Bay. The Berkeley resolution went further, committing Berkeley to oppose all shipment of crude oil by rail through the city until tighter regulations are in place.
Information has recently come to light about crude-by-rail activity in both cities. In September, with no public announcement, the Kinder Morgan rail yard in Richmond quietly switched from handling ethanol to crude oil. And a new proposal calls for shipping crude oil to the Phillips 66 refinery in Santa Maria on train tracks that run through the East Bay.
USGS – Fracked oil from Bakken shale is highly explosive.
At the Richmond City Council meeting, oil-industry expert Antonia Juhasz presented evidence from both the BNSF railroad and Kinder Morgan websites showing that the crude oil coming into the Richmond rail yard is fracked from the Bakken shale fields in North Dakota. This Bakken crude has been responsible for several recent disastrous explosions when trains carrying it have derailed, with the worst accident in Lac Megantic, Quebec, where 47 people were killed and the downtown destroyed.
Juhasz added that there were more derailments and accidents involving crude by rail in 2013 than in the previous thirty years combined. More crude is being shipped by rail because of the huge increase in production of crude from North Dakota Bakken shale and Canadian tar sands, both far inland, and the need to get the fossil fuel to the coasts to refine and export.
Juhasz also reported that the National Transportation Safety Board (NTSB) has said that emergency response planning along the rail routes is “practically nonexistent” and that current regulations are “no longer sufficient” — and that it’s not safe to carry crude oil in the type of car currently being used. Because of all this, the NTSB has recommended that trains carrying crude oil be rerouted “away from populated and other sensitive areas.”
Several Richmond council members and community speakers expressed surprise that the switch to crude oil happened with no public notice. Andres Soto of Communities for a Better Environment said the “real culprit” was the staff of the Bay Area Air Quality Management District, which approved Kinder Morgan’s application to make this change without notifying the public or even the air district board members.
City councilmembers wrestled with the fact that the city has no jurisdiction over railroads — only the federal government can regulate them. But Juhasz and McLaughlin said a resolution by the city was important as part of a demand from many cities and organizations for more regulation of crude by rail.
The resolution called on federal legislators to move quickly to regulate the transportation of the new types of crude oil from Bakken shale and Canadian tar sands. Many speakers argued in favor of a moratorium on shipping crude by rail until adequate regulations were in place.
Meanwhile in Berkeley, another oil-industry expert, environmental engineer Phyllis Fox, described the plan to ship crude oil through the East Bay to Santa Maria — probably through Richmond, Berkeley, and Oakland — since these tracks are built to carry heavy trains. She projected a map showing that rail lines in California parallel rivers and go through the most populated areas, so accidents would be “disastrous.”
Information released about the plan doesn’t reveal the source of the crude oil, but Fox said the two main kinds of crude oil being shipped by rail are from Bakken shale — oil that is highly volatile and prone to explosion — and Canadian tar sands — very heavy oil that is especially toxic and difficult to clean up. “One catastrophic event,” Fox said, “could cause irreversible harm.”
Other sources have pointed out that the Phillips 66 refinery in San Luis Obispo County is geared to refining heavy crude oil, so it’s most likely that the crude headed to that plant would come from the Canadian tar sands.
Many speakers in the public comment period supported the resolution, including residents of Crockett/Rodeo and Martinez, who are waging similar battles in their communities. Speakers pointed out a wide range of problems with shipping crude by rail in addition to the immediate danger. In a pre-meeting rally in support of the resolution, Mayor Tom Bates said the issues “go beyond the danger to our community to our whole carbon future. If we don’t get off fossil fuel we’re all doomed.”
The resolution commits Berkeley to file comments opposing crude-by-rail projects in any draft permit-approval process, starting with the Santa Maria project; to file comments opposing new projects in the Phillips 66 refinery in Rodeo and the Valero refinery in Benicia; and to support the federal Department of Transportation in creating strict regulation of rail shipments of crude oil. In presenting the resolution, Maio also said Berkeley should form a coalition with other cities fighting crude-by-rail projects.