The Trump administration on Monday moved to roll back an Obama-era safety rule mandating that oil trains carrying crude oil install more sophisticated brakes.
The Department of Transportation’s Pipelines and Hazardous Materials Safety Administration said that it found the cost of installing electronically controlled pneumatic brake systems, which reduce the risk of car derailment, would be higher than the safety benefits it delivers.
This mimics claims from the railroad industry, which has said that installing electronic breaks on oil rail cars would cost $3 billion.
Around 20 derailments, including accidents with fatalities, have occurred since 2010, in part due to increased train traffic due to a boost in oil production. (Details at The Hill, Fortune, Buzzfeed.)
It’s been two years since the 2016 crude-by-rail permit for Valero was denied, but a strong memory of it remains for me and probably for a lot of Benicians. It’s because of that experience that I’m urging Benicians to vote for Kari Birdseye for the Benicia City Council.
Birdseye was a new Planning Commissioner when the permit process fell into the Commission’s authority, and she really did her homework to keep us safe in Benicia.
When I spoke to her about that process, she said she would stay up long into the night reading the stacks of material submitted to the commissioners and also would focus intently on everything the public said during the Planning Commission meetings.
She added that it was Kamala Harris, California’s attorney general at that time),who made the biggest impact on her in her comment about how local permitting measures absolutely applied to this process. Birdseye said “I knew then, that the state of California had our back.”
Birdseye voted against the permit along with all the other Planning Commissioners.
When I asked her why she denied the permit besides the significant local reasons, her voice choked when she said “My dad, my husband, my sister and my two children live here, why would I want to risk the health and safety of my family, friends, and all Benicians by bringing in 100 crude oil rail cars into our town, when the safety of this form of transport was in question with the rapid increase of oil train explosions. I did not want our town to be the next tragic headline news story.
She continued, “After listening to so many of the speakers say, ‘I’m afraid of this,’ ‘Let’s not do this,’ ‘We don’t need this for our community,’ ‘Valero doesn’t need this,’ and ‘There are safer ways to bring in their oil,’ our community certainly wasn’t in favor of it, so how could I possibly vote for it?“
After the planning commission denial, Valero appealed to the City Council to certify the Environmental Impact Report and issue the permit. After a five-month delay, this is where another 2018 City Council candidate, then-Councilmember Christina Strawbridge, also voted to deny Valero’s appeal for the permit. It ended up being a unanimous vote to deny Valero’s appeal for the permit, mostly based on the Planning Commission’s work.
Another 2018 council candidate, Lionel Largaespada, was also involved in the crude-by-rail process. Largaespada was in favor of approving the permit and commented to the Planning Commission before their vote, “I understand the concerns. I understand the risks. But I urge you to be objective and pragmatic. Because the fact — the reality is that we need this project to ensure Benicia’s economic future and prosperity. I urge you to certify the EIR and to issue the conditional use permit.”
Based on this recent history of our town and the way the candidates handled the CBR issue, I’m encouraging Benicians to vote for Kari Birdseye because I think she has the compassion and diligence to do the hard work to put the safety of our community first, especially when the next big permitting process comes along. Also, praise to Christina Strawbridge, because she did the right thing.
Repost from Reuters [Quote: “Increased crude shipping by rail…would represent progress in moving more Canadian oil to U.S. refineries.” ]
Cenovus inks deal to move more crude on Canadian National Railway -source
by Julie Gordon, Rod Nickel, September 7, 2018 / 11:18 AM
VANCOUVER/WINNIPEG (Reuters) – Cenovus Energy Inc (CVE.TO), a major Canadian oil producer, has signed a deal to move more crude with the Canadian National Railway Co (CNR.TO), a source with direct knowledge of the matter told Reuters.
The deal is one of many being quietly signed that, along with the expedited deliveries of new locomotives, will help boost Canada’s crude-by-rail shipments 50 percent by year end, a government consultant told Reuters separately.
The source said the Cenovus-CN deal was inked days before a Canadian court last week overturned the approval of the Trans Mountain oil pipeline expansion.
Shipper commitments put CN and smaller rival Canadian Pacific Railway Ltd (CP.TO) in position to collectively move more than 300,000 barrels per day by December, said Greg Stringham, a consultant who mediated talks among oil producers and railways for the Alberta government this year.
Stringham did not directly address the Cenovus deal, but said new crude-by-rail “contracts are being signed. Not all of those been disclosed yet, but it is continuing.”
The railways, burned a few years ago when booming demand for crude-by-rail vanished as oil prices fell and pipeline space opened, are now seeking rich multi-year, take-or-pay deals from producers.The 300,000 bpd would be 50 percent higher than June’s record 200,000 bpd and double 150,000 bpd achieved in December 2017. It is expected to further increase in 2019 as locomotive orders start to catch up with demand.
The two railways and Cenovus declined to comment. The source declined to be identified as the deal is not public.
Cenovus CEO Alex Pourbaix said in July that he was considering a multi-year commitment to move 50,000 to 60,000 bpd by rail.
Cenovus shares rebounded to trade up as much as 0.86 percent soon after the news. Earlier in the day, they had fallen 6.4 percent after Goldman Sachs downgraded the stock to sell.
CN shares were down 0.5 percent.
Increased crude shipping by rail, while still far short of Western Canada’s rail-loading capacity of nearly 1 million bpd, would represent progress in moving more Canadian oil to U.S. refineries. It remains a tiny fraction of the total 3.3 million bpd on average exported, mostly to the U.S., in 2017.
But as crude shipments increase, so do safety concerns. In 2013, a runaway train carrying crude exploded in the Quebec town of Lac Megantic killing 47 people. In June, some 230,000 gallons of crude spilled into an Iowa river after a train derailed.
The head of Canada’s transportation regulator said last month that stronger tank cars for transporting flammable liquids should be required sooner than a 2025 deadline.
Enbridge Inc’s (ENB.TO) oversubscribed Mainline pipeline rations space each month as oil producers expand production, driving a bigger discount in Western Canada’s heavy crude compared to the North American benchmark CLc1.
The increased crude by rail volumes could not happen without new locomotives that the railways are placing into service faster than before.
“Probably the biggest constraint that was identified was the lack of locomotives being available,” said Stringham, adding that the railways went to their suppliers and were able to cut delivery times from 24 months down to nine to 12 months. CN said on Wednesday that it had ordered an extra 60 locomotives from General Electric Co (GE.N), adding to a previous deal for 200 locomotives over three years. The original order will now be completed in two years, and the additional 60 are due in 2020, CN spokesman Patrick Waldron said. Those locomotives will be used for energy transport, along with intermodal, coal and agricultural products. Western Canada’s crude inventories reached 36.3 million barrels for the week ending Aug. 31, a record level since Genscape began monitoring in 2010 as oil production expands faster than transport capacity, analyst Dylan White said.
Reporting by Julie Gordon in Vancouver, Rod Nickel in Winnipeg; additional reporting by Allison Lampert in Montreal; Editing by Denny Thomas and David Gregorio