Category Archives: Crude By Rail

Editorial: Celebrate, but watch on the tracks!

By Roger Straw, December 22, 2016

Why did Valero decide not to go to court?


Roger Straw, The Benicia Independent

On December 20, Benicia’s City Attorney announced that she had been advised by Valero’s attorney that the refinery is no longer planning to sue the City of Benicia over its failed Crude By Rail proposal.

While this is welcome news, worthy of celebration and thanksgiving, Valero’s decision surely was more nuanced than the simple reason given, that it wants to maintain good relations with the City.

Everyone in the city is happy about that – we all want good relations, and no one wanted the issue to drag on in the courts, at great expense in time and money.

But it must be noted that a Benicia lawsuit by Valero would have failed, on multiple grounds. Valero’s best legal advice must have been to quit, or risk additional losses. That advice would’ve been resisted if at all possible, not only for local refinery interests, but on behalf of the wider oil and rail industries.

Valero Benicia was a potential precedent-setting case, with implications for major corporate financial holdings all across the US and Canada. There must have been immense pressure on Valero to sue. The industries needed to win a case claiming that federal preemption laws are enough to overrule local land use regulatory authority.

But with immense activist opposition setting the pace; with California’s Attorney General weighing in and a dozen environmental attorneys, engineers and environmental analysts offering significant commentary during the review process; and with the Federal Surface Transportation Board denying Valero’s last-ditch petition, a lawsuit had little chance of success.

Valero lost that argument here, but no one should rest easy. The oil and rail industries will surely look for another situation where they can more successfully press their unlimited right to endanger health and welfare under federal preemption laws.

The growing movement against oil trains needs to remain active and alert.

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VALLEJO TIMES-HERALD: Valero won’t sue city of Benicia over rejection of crude-by-rail project

Repost from the Vallejo Times-Herald

Valero won’t sue city of Benicia over rejection of crude-by-rail project

By Katy St. Clair, 12/22/16, 4:06 PM PST

BENICIA >> The Valero Corporation announced it will not be suing the city of Benicia for rejecting its controversial crude-by-rail project, which would have allowed the company to transport thousands of gallons of crude oil into town.

The project would have moved up to 70,000 barrels of crude a day to Benicia, passing through places like downtown Sacramento and Davis.

Valero first submitted an application for the project to the city of Benicia in December of 2012, but the Planning Commission rejected the bid in March of this year. Valero then appealed to the Benicia City Council, which also rejected the plan in a unanimous vote in September, citing fears of derailment or spills as its main concern.

“The margin of error was just too small and the risk of catastrophic failure too great,” Councilman Tom Campbell said.

In the wake of the city’s veto, Valero seemed primed to fight the decision in court. Benicia City Attorney Heather Mc Laughlin told the city council on Tuesday night that she had previously “heard word” from the Valero attorney that they were “thinking of filing suit.”

It’s been reported that Valero officials believed Benicia’s rejection of the plan was illegal.

It now appears that Valero is backing off talk of litigation. Mc Laughlin announced that Valero’s attorney contacted her and said they will not be going forward with a lawsuit, after all.

“It’s like the best Christmas present ever,” she said to the council. “Yesterday they called and said that they were not going to file suit against the city because they want to maintain positive relations with the city.”

Valero did not respond to requests for comment.

Mayor Elizabeth Patterson released a statement Wednesday saying she is “pleased” with Valero’s decision not to sue.

“They are a valuable business in our community,” she said. “I look forward to the promise of those good community relations now that we can put this ill-advised project behind us.”

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SACRAMENTO BEE: Refining company reportedly backs away from California oil train lawsuit

Repost from The Sacramento Bee

Refining company reportedly backs away from California oil train lawsuit

By Tony Bizjak, December 22, 2016
Valero operates a major oil refinery in Benicia.

Valero operates a major oil refinery in Benicia. Photo: Manny Crisostomo

Valero Refining Co. appears to have backed away from its threat to sue Benicia over that city’s refusal to allow the company to bring oil to its bayside refinery via trains.

Benicia City Attorney Heather McLaughlin said she received a phone call earlier this week from a Valero attorney telling her the Texas-based oil company has decided it will not challenge the city in court over the city’s refusal to give Valero a building permit for an oil transfer station.

Valero officials could not be reached for comment Thursday morning.

The project would have involved transporting up to two 50-car oil trains a day through Northern California, including downtown Sacramento, Roseville, West Sacramento and Davis en route to Benicia.

After four years of sometimes rancorous debate, the Benicia City Council voted unanimously in September to reject Valero’s permit request. Several council members said they acknowledged expressions of safety concerns from residents and leaders in the Sacramento region, but focused their decision on local safety concerns in Benicia.

The city issued findings that the project “would be detrimental to the public health, safety and welfare of persons residing and working in the adjacent neighborhood, and detrimental to properties and improvements in the vicinity.”

Valero officials initially called the city’s refusal illegal. “There are no legal grounds on which to deny Valero’s permit application,” a Valero attorney said in a letter to the city the week after the council vote.

City officials said they girded for what they feared would be an expensive lawsuit, and took the unusual step of publicly asking oil shipment opponents for financial help should a lawsuit be filed.

On Monday, Benicia City Attorney McLaughlin said she got a “courtesy call” from a Valero attorney, Diane Sinclair, telling her the oil giant wants to maintain good relations with Benicia. The Valero Refinery, on a hillside east of downtown, has been in operation since 1968. Valero is the largest employer in the city.

“(She) said they have decided not to sue the city,” McLaughlin said. “They want to maintain good relations with the city. They didn’t want to have this damage that.”

Benicia Mayor Elizabeth Patterson said she is pleased by Valero’s decision to put an end to the saga, and called Valero a valuable member of the community.

“I look forward to the promise of those good community relations now that we can put this ill-advised project behind us,” Patterson said in an email to The Bee. “There are many opportunities for us to work together” on air quality and sustainable development issues.

Crude oil train projects have become controversial in North America in recent years. Fracking technology has opened vast new oil fields in North Dakota and elsewhere, leading to dramatic increases of shipments via train.

The increase has led to repeated train derailments and explosions. The worst of those accidents killed 47 people in a Canadian town three years ago.

Federal transportation officials have attempted to increase oil train safety via stricter regulations, but officials in cities along rail lines, including Sacramento, say federal officials have not done enough.

The Sacramento Area Council of Governments, which includes county and city leaders in the region, sent several letters to Benicia during the deliberations, supporting that city’s legal right to say no to Valero, if it chose to, and pointing out concerns about rail safety issues.

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