Category Archives: Crude By Rail

Latest derailment, explosion: Lynchburg, Virginia

Repost from Reuters

CSX train carrying oil derails in Virginia, bursts into flames

 By Selam Gebrekidan | NEW YORK Wed Apr 30, 2014
Flames and a large plume of black smoke are shown after a train derailment in this handout photo provided by the City of Lynchburg, Virginia April 30, 2014. REUTERS/City of Lynchburg, Virginia/Handout via ReutersFlames and a large plume of black smoke are shown after a train derailment in this handout photo provided by the City of Lynchburg, Virginia April 30, 2014.

Credit: Reuters/City of Lynchburg, Virginia/Handout via Reuters

(Reuters) – A CSX Corp train carrying crude oil derailed and burst into flames in downtown Lynchburg, Virginia on Wednesday, spilling oil into the James River and forcing hundreds to evacuate.

In its second oil-train accident this year, CSX said 15 cars on a train traveling from Chicago to Virginia derailed at 2:30 p.m. EDT. Photos and video showed high flames and a large plume of black smoke. Officials said there were no injuries, but 300-350 people were evacuated in a half-mile radius.

City officials instructed motorists and pedestrians to stay away from downtown, while firefighters battled the blaze. Three railcars were still on fire as of 4 p.m., CSX said.

The fiery derailment a short distance from office buildings in the city of 77,000 was sure to bring more calls from environmentalists and activists for stricter regulations of the burgeoning business of shipping crude oil by rail.

JoAnn Martin, the city’s director of communications, said three or four tank cars were leaking, and burning oil was spilling into the river, which runs to Chesapeake Bay. She said firefighters were trying to contain the spill and would probably let the fire burn itself out.

Attorney John Francisco at the firm of Edmunds & Williams, told local TV station WSET 13 he heard a loud noise that sounded like a tornado and then watched as several cars derailed. He said flames streaked as high as the 19th floor of his office building in Lynchburg, the commercial hub of central Virginia.

“The smoke and fire were on a long stretch of the train tracks. The smaller fires died down pretty quickly. You could feel the heat from the fire,” Randy Taylor, who was working downtown when the train derailed, told the station.

The U.S. Department of Transportation said it was sending Federal Railroad Administration inspectors to the scene.

There was no immediate information about the origin of the cargo or the train’s final destination. One of the only oil facilities to the east of Lynchburg is a converted refinery in Yorktown, now a storage depot run by Plains All American. The company did not immediately reply to queries.

It was not clear what had caused the accident or triggered the fire. CSX said it was “responding fully” to the derailment with emergency personnel, safety and environmental experts.

Central Lynchburg General Hospital had not had any injured people brought in from the train derailment, spokeswoman Diane Riley said.


Several trains carrying crude have derailed over the past year. Last July, a runaway train in Lac-Megantic, Quebec, derailed and exploded, killing 47 people. Another CSX train carrying crude oil derailed in Philadelphia in January, nearly toppling over a bridge.

With more trains hauling crude and flammable liquids across North America, U.S. regulators are expected soon to propose new rules for more robust tank cars to replace older models; Canadian authorities did so last week.

“With this event, regulators could try to expedite the process, and they’ll likely err on the side of the more costly safety requirements in order to reduce the risk of these accidents in the future,” said Michael Cohen, vice president for research at Barclays in New York.

Tougher rules could drive up costs for firms that lease tank cars and ship oil from the remote Bakken shale of North Dakota, which relies heavily on trains. It could also boost business for companies that manufacture new cars, such as Greenbrier Companies and Trinity Industries.

Oil trains rolling across the country, often a mile long, have sparked concern in local communities, particularly in New York and the Pacific Northwest. Derailments have occurred in places as far removed as Alberta and Quebec in Canada, and North Dakota and Alabama in the United States.

In Virginia, environmental groups including the Sierra Club and the Chesapeake Bay Foundation have opposed expansion of crude-by-rail shipments through the region to the Yorktown terminal, which can handle 140,000 barrels per day. CSX’s route through populated areas like Lynchburg and the proximity to the James River have been mentioned as special concerns.

“Whenever oil is handled around water, a percentage of it gets into the water. This derailment is of major concern to us,” said William Baker, President Chesapeake Bay Foundation. City officials said there was no impact on drinking water.

CSX has been positioning itself to deliver more crude to East Coast refineries and terminals. In January, Chief Executive Officer Michael Ward told analysts the company planned to boost crude-by-rail shipments by 50 percent this year.

At the time, Ward said that Jacksonville, Florida-based railroad was working with U.S. regulators to address safety concerns in light of recent derailments and fires.

(Reporting by Selam Gebrekidan, Joshua Schneyer, Anna Driver, Patrick Rucker, Josephine Mason, Ian Simpson; Editing by David Gregorio)

    A first time divergence between Canadian and U.S. railway regulations

    Repost from

    Safety and climate concerns as oil by rail surges forward in North America

    By Roger Annis | April 29, 2014

    CN locomotive and oil wagons on the shore of Halifax harbour, photo Flikr Commons

    On April 23, Canada’s minister of transport, Lisa Raitt, announced changes to railway transportation regulations in Canada that she says will make safe the rapidly growing transport of crude oil and Alberta tar sands bitumen in North America.

    Raitt’s changes come in response to citizen pressure following a string of spectacular oil train crashes in the past nine months, most particularly the crash in Lac Mégantic, Quebec on July 6, 2013 that killed 47 people.

    Raitt proposed two measures of substance: speed limits of 80 kilometers per hour must be followed henceforth by trains containing 20 or more wagons of dangerous goods (that speed can be lowered in populated or ecologically sensitive areas), and the most dangerous of the DOT 111 rail wagons used to transport oil—those without continuous crash shields along the bottom, numbering 5,000 or so—be withdrawn from carrying dangerous cargo within 30 days.

    Otherwise, the minister says that Canada’s estimated fleet of 65,000 older DOT 111s must undergo modifications within three years to improve crash resistance, and better emergency response plans must be in place for when crashes of trains carrying oil and other dangerous goods occur.

    Until now, modifications to DOT 111s have been voluntary in the U.S. and Canada. As for emergency response, Canada already has a required ‘Emergency Response Assistance Plan’ (ERAP) system on its railways for the transport of chorine, liquid petroleum gases, explosives and other exceptionally dangerous cargo. That dates from the fallout of a 1979 rail crash and explosion of chlorine and propane in a Toronto suburb that forced the evacuation of 200,000 people from their homes. ERAPs will now be required for any train carrying crude oil or other liquid fossil fuel.

    Raitt’s announcement creates for the first time a divergence between Canadian and U.S. railway regulations. Cross-border harmonization has been previously assured by Canada simply following any U.S. regulatory lead. Now, for the first time, several distinct, Canadian regulations may come into place for trains that U.S. railways and shippers wish to bring across the border.

    This could become a real headache in three years time if U.S. shippers and carriers take longer to modify or phase out older DOT 111s. And since Lac Mégantic, they are showing few signs of any hurry. At a recent National Transportation Board hearing, a representative of the American Petroleum Institute said that older rail cars will be needed for at least ten more years.

    Two measures that the federal government is refusing to take, responding to railway pressure, is advance notification by the railways to municipalities of the movement of dangerous cargos through their jurisdictions, and more extensive ‘route planning’ that would direct trains carrying dangerous cargos around populated areas. The latter measure would be costly for the railways and not logistically possible in many cases.

    Of continuing note is the failure of the federal government to convene a judicial inquiry into the cause of the Lac Mégantic disaster. For the railways, oil shippers and the federal government, such a proceeding would be very uncomfortable. It would shed light on the string of circumstances that produced the disaster, and that might shed further light on criminal wrongdoing or liability in such areas as:

    • The dilapidated condition of the Montreal, Maine and Atlantic Railway. The consignee of the oil on the fateful train was Irving Oil of New Brunswick. A consortium came together to begin to ship oil from North Dakota to Irving’s refinery in Saint John, New Brunswick in 2012. The consortium included CP Rail.
    • The failure to notify and warn communities of the possible safety consequences of the oil by train operation.
    • The successive decisions by federal rail regulators that allowed MM&A to operate with lesser safety standards that the Class I rail duopoly in Canada, including operating its trains with one employee only.
    • The mislabeling of the volatility of North Dakota oil that listed it as less dangerous than it was.

    To this day, most U.S. oil shippers in North Dakota are refusing to share with the U.S. Department of Transportation the results of their chemical analyses of the crude product they are shipping.

    North Dakota (and to a lesser extent Saskatchewan) is the location of the Bakken oil field, the second largest oil field in the U.S. Seventy per cent of its crude oil product is shipped by rail. The volatility of Bakken crude, it turns out, resembles that of refined gasoline.

    The danger of railway shipments in North America is illustrated by a front page article appearing in the Toronto Star on April 26. It reports that in a 24 hour survey the newspaper recently conducted of one of the rail lines running through Toronto, owned by CP Rail, it counted more than 130 cars of crude oil, and tankers carrying methyl bromide and ethyl trichlorosilane — highly poisonous chemicals rated among the world’s most dangerous — as well as radioactive material, methanol, diesel, sulfuric acid and other hazardous goods.

    The article reports that the railways and the federal government cite ‘security’ reasons for not divulging their shipments. But Fred Millar, a U.S. consultant on chemical safety and rail transport, tells the newspaper, “This security excuse is really a hoax. These are giant tank cars with placards on the sides that tell you what’s in them.”

    Surge of oil by rail

    In 2013, there were 450,000 carloads of oil moved by rail in the U.S. (not including movements by Canada’s two railways). So far in 2014, U.S. carload movements are up nine per cent over last year.

    According to Statistics Canada, railways in Canada moved app. 165,000 carloads of fuel oils and crude petroleum in 2013, including movements into the U.S. The number jumps to 237,000 when liquid petroleum gas (propane, butane, etc) is included. Carloads of fuel oil and crude petroleum were up 18 per cent in January 2014 over the same month last year.

    This will soon pale in comparison to the huge surge of Alberta tar sands bitumen and conventional oil that is coming. Tar sands and conventional crude producers and shippers are building rail capacity in Alberta and Saskatchewan at a dizzying rate. Some is already operational. The Financial Post reports that a total of 850,000 barrels per day of rail shipping capacity is under construction in Alberta, more than the amount of oil that the Keystone XL pipeline would carry. If all that went into trains, it would be half a million carloads in one year.

    By the end of 2014, some 550,000 barrels daily will be rolling.

    Investment broker Peters & Co says crude oil carloads originating in Canada could triple by 2015.

    One of the largest operations under construction is being built by Kinder Morgan and Imperial Oil. It will handle 100,000 barrels of dilbit per day, app.1 1/3 unit trains per day, with an expansion capacity to take it to 250,000 bpd once further, feeder pipeline connections are made.

    Whether by rail or by pipeline, port authorities in Houston and coastal Texas are gearing up for much more export traffic.

    Port export projects are also planned in Saint John, New Brunswick (Irving Oil), on the lower St. Lawrence River at Cacouna, Quebec (TransCanada), and in Portland, Maine. These three projects are in anticipation of the Energy East tar sands pipeline with its planned capacity of 1.1 million barrels per day and the proposed ‘reversal’ of Enbridge Inc.’s aged Line 9 across southern Ontario.

    One factor affecting oil by rail prospects is shipping costs. Compared to pipelines, the cost of shipping oil by rail is approximately double–$15-20 per barrel by rail compared to $7-11 for pipelines. More use of unit oil trains can bring down rail costs, though these heighten the dangers compared to mixed-cargo trains in which groups of cars carrying flammable liquids are separated by cars less-flammable products.

    The Financial Post reports that the first unit bitumen train rolled out of Alberta late last year. Gary Kubera, chief executive of Canexus, one of the first oil train terminal companies to expand facilities in Alberta, told Reuters recently, “We expect unit trains will be going to the East, West and Gulf coasts. There is a lot of investment going into refineries to allow them to move crude by rail.”

    One of the consequences of the surge of oil by rail (and coal) is that non-fossil fuel customers get short shrift because oil (and coal) shipments are more lucrative for the railways. For grain farmers in Canada and the U.S., 2013 was a bumper year, but they have lost significant income for lack of timely rail transport to get crops to market. The situation in Canada has become so bad that the federal government was obliged to adopt a special law in late March directing the rail companies to transport specified, weekly amounts of grain for the foreseeable future under penalty of fines. U.S farmers are also complaining, but so far there is no government action.

    In Canada, there is a legislated maximum rate dating from the year 2000 that the railways can charge to grain farmers.

    Last December, some Amtrak passenger train service connecting Chicago and the west coast was cancelled because of heavy coal and oil traffic on shared rail lines.

    Meanwhile, a new entry to the fossil fuel-congested rail line story is… sand! The product is required extensively for oil and gas fracking. U.S. fracking-sand shipments have jumped more than fourfold since 2007, to 20.9 million tonnes in 2012, according to Freedonia Group, a Cleveland-based market researcher. Demand is expected to more than double to 47.3 million tonnes by 2022, the group predicts.

    It’s all a major profit bonanza for the railways. In Canada, CN and CP reported first quarter profits in 2014 of $254 million and $623 million, increases of 17 per cent and 12 per cent, respectively, over the same quarter last year. Overall revenues in 2013 were up seven per cent at CN and eight per cent at CP.

    In the U.S., the largest rail carrier of oil, BNSF, had 2013 earnings of $6.7 billion, up 15 per cent over the previous year. Union Pacific earned $7.4 billion the same year, up ten per cent.

    All of this comes as scientists are saying ever more urgently that if humanity is to avoid runaway global warming with catastrophic consequences for human society, a rapid shift is needed away from the extraction and burning of fossil fuels. The latest such warning is in a report by the United Nations’ Intergovernmental Panel on Climate Change released in late March. The report was the result of three years’ work by more than 300 scientists around the world.

      Feds to brief Local and State Oregon Officials

      Repost from The Statesman Journal, Salem, Oregon

      Crude oil train safety: Oregon leaders to get briefing

       Tracy Loew, Statesman Journal   |  April 26, 2014

      State and local government officials will get a briefing on crude oil transport safety next week.

      Gov. John Kitzhaber requested the meeting, which will lay out current practices and identify additional steps that may be taken to ensure that trains traveling in Oregon are operating as safely as possible.

      Last year, 19,065 tank cars of oil moved along Oregon’s railroads, up from just 659 in 2007. Some of those trains run through the Willamette Valley, including Salem.

      Shipments are expected to increase, boosting the risk of oil spills or explosions.

      Much of the oil comes from the Bakken field in North Dakota, and is more flammable than traditional crude.

      Nationwide, critics are calling for safer tank cars and better emergency planning.

      U.S. Transportation Secretary Anthony Foxx said today he will propose a comprehensive package of rules next week to deal with oil trains.

      Among the presenters at Tuesday’s briefing will be representatives from the U.S. Environmental Protection Agency and U.S. Coast Guard; and the Oregon State Fire Marshal, Department of Transportation Rail Division, Department of Environmental Quality, Office of Emergency Management and Governor’s Office; as well as Union Pacific, BNSF and Genesee & Wyoming railroads.

      The meeting is not open to the public.