Category Archives: Volatile gases

LOCAL OP-ED – Jerome Page: The triumph of human ingenuity

Repost from The Benicia Herald

Jerome Page: The triumph of human ingenuity

August 8, 2014 by Jerome Page

TIME TO TAKE A CLOSE LOOK AT OUR STARTLING SUCCESS in solving our energy problems with oil — good old American Bakken crude along with a hefty swash of that Canadian tar sands crude. Canada being a very friendly neighbor, this seems a great deal on both sides of the border. And thanks to a fine railroad system, it’s just a simple straight shot from North Dakota and Alberta right up to our door here in Benicia, California! Providence be blessed!

And yet there are, as always, folks who not only want to examine that gift horse’s teeth but can be just plain ungracious — if not downright surly and disagreeable — about it. What could possibly be wrong with cheaper oil in copious quantities, without ever having to deal with folks who don’t even speak English?

But enough. I’ll step out of the Joe Schmoe character and comment just a bit on that question of what can, in fact, possibly be wrong.

From an Earth Island Journal clipping (June 29, 2014), a piece by Adam Federman, we read: “Since the Lac-Mégantic disaster (with its 47 dead) there has been a string of oil train collisions and derailments. Late on the night of November 7, a train carrying at least 2.7 million gallons of Bakken crude derailed near Aliceville, Alabama, resulting in dramatic explosions similar to those seen in Lac-Mégantic. Because the train exploded a few miles outside of Aliceville, no one was injured or killed. On December 30, a train carrying crude collided with another train outside of Casselton, North Dakota, releasing more than 400,000 gallons of oil into the surrounding land. At least half the town’s 2,400 residents were evacuated, though no one was injured. And on April 30, an oil train operated by CSX derailed in the city of Lynchburg, Virginia, sending flames and oil into the James River and forcing the evacuation of more than 300 residents. Last year more oil spilled in rail accidents — 1.15 million gallons — than the previous 35 years combined.” (Italics mine)

Then the following:

“Extra-flammable Bakken crude riskier to ship by rail than other oil, U.S. safety watchdog warns,” by Jeff Lewis, Jan. 2, 2014:

“CALGARY — U.S. authorities said Thursday crude oil shipped by rail from the Bakken shale in North Dakota across the United States and Canada ‘may be more flammable’ than other types of oil, as the latest in a string of explosive accidents focuses attention on the booming oil-by-rail trade.”

How about we ditch that “may be”! For example, another read on Casselton:

“‘There was a huge fireball’: Train carrying crude oil explodes after derailing in North Dakota,” by Dave Kolpack, Associated Press, Dec. 30, 2013:

“A train carrying crude oil from North Dakota’s oil patch derailed Monday near the small town of Casselton, setting off a series of fiery explosions. No injuries were initially reported, but officials were warning residents to stay indoors as the situation unfolded. Cass County Sheriff’s Sgt. Tara Morris says as many as 300 residents of Casselton may be evacuated.

“Morris estimates about 10 cars from a mile-long train caught fire and will have to burn out. She said it could take up to 12 hours before authorities can get close.

Next, “How crude-by-rail accidents may impact the U.S. oil market,” Reuters, Jan. 23, 2014:

“A spate of high-profile crude-by-rail accidents is making oil analysts consider how tighter rail safety standards could impact U.S. oil markets, by potentially crimping a mode of transport that has grown exponentially amid the shale drilling boom.

“Any regulation or industry-driven move to hastily sideline a fleet of some 75,000 older tank cars commonly used for shipping crude could roil U.S. oil logistics, boost costs for refiners, and even hit output from North Dakota’s giant Bakken field, oil analysts said.

“The scenario that many view as more likely — where older rail cars could be gradually retrofitted or retired — would be less disruptive but still raise transportation costs.” (And, of course, forestall greater dangers, but what the hell, what’s life without a little spice!)

“Tank cars known as DOT-111s are used to transport most of the 10 percent of U.S. oil production, or around 800,000 barrels per day, that is shipped by railroad. The cargoes have surged over the past half decade, offering drillers in fast-growing shale plays like the Bakken a quick and flexible way to send barrels to consumer markets without relying on limited regional pipelines.

“DOT-111 rail cars built before 2011, which have been involved in several accidents, are under scrutiny for safety issues that make them more likely to puncture in a derailment.

“Over the weekend, a train carrying North Dakota crude derailed in Philadelphia, although there was no fire or injuries.

“‘I view this as a potentially hugely significant rail risk,’ said Credit Suisse’s Jan Stuart, referring to how new crude-by-rail safety measures could impact Bakken-region oil logistics or production.” (That risk of course is financial, and when you’re talking financial risk, man you have an audience; human risk, risk to life and limb — not so much!)

“So far, the Department of Transportation has set a schedule for next year to draft new regulations, including updated tank car specifications, but it is facing pressure to move faster.

“‘Regulators have endorsed the new safety standards for newly built cars, but so far have not required any retrofitting,’ said Sandy Fielden of the RBN Energy consultancy in Austin. ‘If the existing fleet of older cars were to need retrofitting, it would be very disruptive.’”

And why in hell would we be wanting to do anything “disruptive” when the money is rolling in so beautifully! Is it that hard for people to focus on the crucial bottom line?!

“In the fast-growing Bakken, where pipeline capacity has not kept up with oil production, more than 70 percent of output that is approaching 1 million barrels per day now moves by rail, according to the North Dakota Pipeline Authority.

“Over half of the U.S. crude moved by rail hails from the Bakken, where the trend has allowed drillers to quickly send their barrels to refineries in the biggest fuel markets along U.S. coasts where they fetch higher prices, boosting profits.

“‘The most likely scenario is for regulators to gradually phase in safety improvements,’ said energy analyst Michael Wittner of Societe Generale. ‘That could increase transportation costs, but if there were a decision to replace older tank cars on short deadline, crude would be piling up in North Dakota.’” (Let’s not be disrupting the flow of oil — and cash.)

“Retrofitting the entire fleet of older DOT-111s would be costly and take up to ten years, the Rail Supply Institute, which represents tank car owners, said last year, in part because manufacturers are already struggling with a backlog of tank car orders. Newer DOT-111s feature safety improvements, but comprise only around 14,000 cars so far, according to the AAR.

“Sidelining older DOT-111s could depress Bakken oil prices at the wellhead as producers compete for insufficient pipeline capacity, eventually hurting production, Fielden said. Any fall in deliveries by rail could force some coastal U.S. refineries to go back to buying more expensive crude imports.

“If all older tankers were retrofitted, it could add between 20 and 40 cents per barrel to crude-by-rail costs, assuming a cost of $30,000 to $60,000 per car, according to a report this month from Turner, Mason & Company consultants.

“Should producers have to rely just on pipelines, Bakken deliveries would plummet to less than 600,000 bpd at the most, less than 60 percent of daily output, according to the state pipeline authority.

“Because of its rapid output growth and isolated location from fuel markets, only a small portion of Bakken crude is processed in facilities known as fractionation plants, which strip out volatile gases like propane and butane, known as light ends. The plants can require large up-front investment, and years to build.” (Whoa there, time and money again? Forget it!)

“‘Regulatory costs are going to go up, it’s just a question of how high and how fast,’ said Robert McNally, president at U.S. energy consultant Rapidan Group. ‘I expect officials will try to find a sweet spot where timely and adequate regulations … do not cripple Bakken economics.’” (Ah yes, a sweet spot that doesn’t interfere with profit!)

Just maybe in all of that there are some lessons for those of us living in Benicia, California about the priorities that should be guiding our decisions when it comes to bringing in Bakken and Canadian tar sands crude. Our neighbors to the east on that train route are obviously deeply concerned; why not Benicia?

Should an accident or major spill occur on that clearly precarious route down the Feather River Canyon, the damage to river, reservoir and water supply would be incalculable. And what of Sacramento and Davis and their obvious great vulnerability — have we no responsibility to our neighbors along that long trail from Alberta or North Dakota to Valero?

And, finally, of course, there is that bloody problem of the environmental costs of jacking up our use of not just more oil — bad enough in itself — but the most dangerously polluting stuff we can find. A bizarre example of man’s capacity to blot out the future in the pursuit of — just what?!

Jerome Page is a Benicia resident.

Fox Guarding Henhouse: Oil-By-Rail Standards Led by American Petroleum Institute

Repost from DeSmogBlog

Fox Guarding Henhouse: Oil-By-Rail Standards Led by American Petroleum Institute

By Justin Mikulka, July 9, 2014

How did it get missed for the last ten years?”

That was the question Deborah Hersman, chair of the National Transportation Safety Board (NTSB), posed to a panel of industry representatives back in April about how the rail industry had missed the fact that Bakken oil is more explosive than traditional crude oil.

How do we move to an environment where commodities are classified in the right containers from the get go and not just put in until we figure out that there’s a problem,” Hersman asked during the two-day forum on transportation of crude oil and ethanol. “Is there a process for that?”

The first panelist to respond was Robert Fronczak, assistant vice president of environmental and hazardous materials for the Association of American Railroads (AAR). His response was telling.

We’ve know about this long before Lac-Megantic and that is why we initiated the tank car committee activity and passed CPC-1232 in 2011,” Fronczak replied, “To ask why the standards are the way they are, you’d have to ask DOT that.”

So, now as the new oil-by-rail safety regulations have been sent from the Department of Transportation (DOT) to the White House’s Office of Information and Regulatory Affairs, it seems like a good time to review Hersman’s questions.

How did we miss this? Is there a process to properly classify commodities for the right container before they are ever shipped?

Missed or Ignored?

Fronczak stated that industry knew about the explosive danger of Bakken crude long before the Lac-Megantic disaster, but it was up to the Department of Transportation to do something about it. That begs the question: what did the department know?

In a letter sent by Thomas J. Herrmann of the Federal Railroad Administration (a division of DOT) to the American Petroleum Institute’s CEO Jack Gerard on July 29, 2013, just 23 days after the Lac-Megantic disaster, it would appear the DOT was well aware of Bakken crude classification issues.

FRA audits of crude oil loading facilities indicate that the classification of crude oil being transported by rail is often based solely on Material Safety Data Sheet (MSDS) data that only provides a material classification and a range of material properties. This MSDS information is typically provided by the consignee to the shipper, and the shipper is unaware of validation of the values of the crude oil properties.

FRA‘s audits indicate that MSDS information is not gleaned from any recently conducted tests or from testing for the many different sources (wells) of the crude oil. For example, a shipper provided information to FRA showing that crude oil being transported by rail had a flash point of 68° F, or a Packing Group I hazardous material. However, the crude oil had been improperly classified as a Packing Group III material and was being transported in AAR class tank cars that were not equipped with the required design enhancements.

The letter goes into detail on several other issues with Bakken crude and recommends that “shippers evaluate their processes for testing, classifying, and packaging the crude oil that they offer into transportation via railroad tank cars.”

So it is clear that as of July 2013, the Federal Railroad Administration was well aware of issues regarding misclassification of Bakken crude oil based on its own audits.

Several of the panellists at the NTSB hearing in April made the point that Bakken crude was different.

We are just not sure what we’re handling,” Fronczak said. “We’ve done some minor sampling, you know a few samples that indicate that the crude oil does have a high vapor pressure and a fairly high amount of dissolved gas and so we feel a pressure car is more appropriate.”

A pressure car is currently the safest possible tank car the new regulations could require.

William Finn of the Railway Supply Institute echoed this sentiment, “For years we’ve transported crude oil in one eleven cars [DOT-111], what’s changed here is the introduction of the unit train and the question of what’s happening with the Bakken crude oil and the high vapor pressures.”

Greg Saxton, chief engineer for tank car manufacturer Greenbrier Companies, said: “The crude we are moving today, we think its different than what we were moving five or ten years ago.”

If the exploding trains weren’t enough to convince people that the Bakken crude oil is different, those comments should remove any doubt.

API Concludes Bakken Oil Poses No “Special Risks”

In April, DOT Secretary Anthony Foxx commented to the Associated Press on how important proper crude oil classification was regarding oil-by-rail safety, saying,  “One of the most fundamental questions that cuts across everything in crude oil-by-rail is how it is classified.”

So who gave the presentation at the NTSB conference on classification of crude oil? The American Petroleum Institute.

Lee Johnson gave a presentation on the API’s current crude oil classification working group, which he stated, “is going to come up with the standard which is going to have guidance on how often you should do that [testing], what tests you should take, sampling techniques, lab techniques.  It’s going to be a very comprehensive standard.  At this point there is no industry standard.”

During his presentation, Johnson highlighted one of the main efforts of the API’s work on classification. The North Dakota Petroleum Council was hiring a firm to conduct testing on Bakken crude for classification purposes.

The results of that Bakken classification testing have since been released and were reported in the Wall Street Journal as follows:

Crude oil from the Bakken Shale formation doesn’t pose special risks to rail transport and shouldn’t require a separate classification regime than other hazardous liquids, North Dakota oil producers said.

This is what happens when you let an industry self-regulate. They make up their own rules and reality. In May, APICEO Jack Gerard made his position clear:

It is essential to separate fact from fiction as we work to enhance the safe transportation of crude oil. Multiple studies have now debunked the idea that Bakken crude is meaningfully different than other crudes.”

However, not everyone was buying these results. New York’s Senator Chuck Schumer told Reuters that these test results should be “taken with a grain of salt.”

And the Canadian Crude Quality Technical Association said, “We would consider the data suspect.”

The main reason for the association’s suspicion is the sampling technique that was used. The samples were taken using open containers, which allow the volatile gases to escape before testing.

That’s the kind of thing that happens when there are no standards for sampling and testing.

The New Regulations

So as the new oil-by-rail safety regulations are about to be released by the White House, there still are no enforceable standards on how to properly sample, test and classify Bakken crude oil. The only testing data that’s been released up to this point is from the oil industry’s lobbying groups.

The Department of Transportation has taken samples of Bakken crude and conducted testing — however, the report on their results is still pending and there is no scheduled release date. It is nearly a year after the department’s initial letter to Jack Gerard of the American Petroleum Institute.

Further, the Department of Transportation is not ultimately responsible for developing new standards for testing and classifying crude oil.

To understand how the regulatory agency in charge of an industry is not responsible for developing these standards, you must look at the wording of legislation signed into law by President Bill Clinton in 1996 called “The National Technology Transfer and Advancement Act of 1995.”

This legislation essentially privatized the development of standards. The act states:

All Federal agencies and departments shall use technical standards that are developed and adopted by voluntary consensus standards bodies, using such technical standards as a means to carry out policy objectives or activities determined by the agencies and departments.”

So, for there to be new enforceable regulations regarding the classification of Bakken crude, several things would have to happen. An external standard developer like ASTM International would have to develop standards. Then members of industry or their lobbyists would have to volunteer to petition the DOT to adopt those standards as part of the regulations. This would require a new DOT rulemaking process separate from the one currently in progress, which could take several years.

A Fundamental Question Goes Unanswered

So, on the eve of new regulations, the fundamental question of how to properly sample and test Bakken crude oil for appropriate classification has not been answered. And the only group currently working on an “industry standard” for this is the American Petroleum Institute, which has already concluded that Bakken crude is no different from other crude oils  — at the same time API is having private meetings at the White House regarding the new regulations.

Chair Hersman resigned shortly after the forum in April, ending her 10-year career with the NTSB. At the time she told the AP she had, “seen a lot of difficulty when it comes to safety rules being implemented if we don’t have a high enough body count. That is a tombstone mentality. We know the steps that will prevent or mitigate these accidents. What is missing is the will to require people to do so.”

If the current process regarding new oil-by-rail regulations in the U.S. is any indication, apparently we haven’t achieved a high enough body count yet.

BizJournal: Why does North Dakota oil explode so much?

Repost from The Minneapolis / St. Paul Business Journal 

Why does North Dakota oil explode so much?

By Mark Reilly, Managing Editor- Minneapolis / St. Paul Business Journal – July 8, 2014

Oil-industry shortcuts made in the early days of the North Dakota oil boom have left the state awash with crude oil that’s so unstable many pipeline companies won’t ship it. Cue the exploding trains.

The Wall Street Journal reports that only one company in North Dakota has installed stabilizer equipment to remove explosive gases from the crude oil before transport. Federal regulations don’t call for such measures, but pipeline companies do, and that’s one reason why North Dakota oil is so often shipped by rail — and why oil trains have exploded so ferociously when they derail.

RELATED: Oil train tally: More than 40 per week into Minnesota

Now, faced with the prospect of an explosion in a populated area, regulators are reconsidering those rules. Industry groups have played down the danger, saying that train cars can handle the issue.

The Journal contrasts North Dakota with Texas, another region that’s seeing a boom in fracking-produced oil that’s possibly even more combustible. But in Texas, companies spent hundreds of millions of dollars to add stabilizing equipment and now ship it via pipeline with no trouble.

US Rep. Thompson & colleagues urge action on oil train safety

Repost from Representative Mike Thompson’s website
[Editor: see also the full text of the Reps’ letter below this press release.  – RS]

Reps. Thompson, Matsui, Miller & Garamendi Send Letter To Secretary Of Transportation Foxx Requesting Immediate Action To Improve Safety Of Crude Oil Shipped By Rail

Jul 1, 2014  |  Press Release
Letter calls on DOT to expedite rules and issue regulations to improve safety of crude shipments and prevent future accidents

WASHINGTON, DC – Today, Representatives Mike Thompson (CA-05), Doris Matsui (CA-06), George Miller (CA-11) and John Garamendi (CA-03) sent a letter to Secretary of Transportation Anthony Foxx expressing strong concern over the increased shipments of crude oil by rail in their districts, and calling for action to increase safety.

“We are especially concerned with the high risks involved with transporting lighter, more flammable crude in densely populated areas. Should spills or explosions occur, as we have seen over the last year, the consequences could be disastrous, costing lives, damaging property, and harming the environment,” the members wrote. “While we are pleased with the many actions that DOT has taken thus far and we believe that your agency is making steady progress, we must still emphasize the utmost importance of demonstrated compliance with federal regulations by the railroad and petroleum industries.  We believe there must be accountability and comprehensive oversight, as well as adherence to the most stringent of standards.”

Specifically, the letter calls on the Department of Transportation (DOT) to:

  • Provide a report on the level of compliance by the railroad and petroleum industry to the May 7th Emergency Order that requires information be shared in a timely manner with local entities.
  • Issue a rulemaking that requires stripping out the most volatile elements from Bakken crude before it is loaded onto rail cars.
  • Expedite the issuance of a final rulemaking to require the full implementation of Positive Train Control (PTC) technology for all railroads transporting lighter crude and provide a status report on the progress of PTC implementation to date.
  • Expedite the issuance of a rulemaking that requires phasing out old rail cars for newer, retrofitted cars.

The full text of the letter is below:

July 1, 2014

The Honorable Anthony Foxx
Secretary, U.S. Department of Transportation
1200 New Jersey Avenue, S.E.
Washington, D.C. 20590

Dear Secretary Foxx:

As members of the California Congressional Delegation, we are writing to voice our strong concerns over the increased shipment of crude oil by rail in our districts and the safety risks associated with this upsurge. Northern California is already seeing a significant increase in the movement of oil through our local communities, and the number of shipments is only expected to rise in the coming years. We commend the Department of Transportation (DOT) for its focus thus far on more information sharing, slower speeds, and reinforced railcars. As you know, the solutions for this important safety issue must be multi-pronged and implemented as quickly as possible, which requires a strong and coordinated effort by the federal government to achieve an effective solution.

We are especially concerned with the high risks involved with transporting lighter, more flammable crude in densely populated areas. Should spills or explosions occur, as we have seen over the last year, the consequences could be disastrous, costing lives, damaging property, and harming the environment. While we are pleased with the many actions that DOT has taken thus far and we believe that your agency is making steady progress, we must still emphasize the utmost importance of demonstrated compliance with federal regulations by the railroad and petroleum industries.  We believe there must be accountability and comprehensive oversight, as well as adherence to the most stringent of standards.

We appreciate your agency’s May 7th Emergency Order that requires carriers to provide State Emergency Response Commissions with advance notice because it is imperative that local emergency managers and first responders are given up-to-date information on what materials are being transported through their regions, when these transports are occurring, and where this crude oil will be stored. But, because improved coordination and communication between the oil companies, railroads, and emergency managers is so fundamental to the safe transport of highly flammable lighter crude, we request a full report on the level of compliance by the oil companies and railroads to date.

Additionally, we urge your agency to prioritize implementing solutions in an expeditious manner that we believe will better protect our communities. One such solution would remove a significant amount of the volatile elements, flammable natural gas liquids (NGLs), from the crude before it is loaded onto rail cars and we understand that regulators are already considering this course of action. In order for industry to comply, they would need to build small processing towers known as stabilizers that shave off NGLs from crude before it is ultimately loaded for transport. Stabilizers are common in other parts of the country and we understand that this could also be feasible through equipment leasing.  Because your agency has explicitly stated that all options are on table, we believe that requiring the petroleum industry to make lighter crude shipments by rail less volatile must be a part of the solution. And, although building infrastructure will require time and investment, industry experts have also publicly stated that stripping NGLs from lighter crude is a part of the equation for addressing railcar safety.

Furthermore, we believe that positive train control (PTC) advanced technology should be fully implemented as it is designed to automatically stop or slow a train before accidents can occur.  Derailments must be avoided at all costs and PTC should be prioritized due to its accurate prevention of train-to-train collisions and derailments caused by excessive speed and unauthorized movement of trains.  We believe that an expedited final rulemaking requiring full implementation of PTC is needed for those railroads that will be transporting lighter crude by rail through our communities.

Yet another solution that has been considered and in some cases the oil industry has initiated, is switching out older rail cars for new, retrofitted ones.  We urge your agency to issue a rulemaking to require phasing out and retrofitting older tank cars that do not have the latest safety technologies installed in order to further minimize the impact of an explosion, if a derailment with lighter crude were to occur.

As all of these federal emergency orders and standards are being considered and final regulations are set to come out next year, we request that your agency provide us ongoing information regarding industry compliance and develop ambitious standards that will both prevent derailments and ensure that industry workers and communities are protected in cases where derailments do occur.  We cannot allow communities to be in danger when viable solutions are available.

To sum up our requests, we would like your agency to:

  • Provide a report on the level of compliance by the railroad and petroleum industry to the May 7th Emergency Order.
  • Issue rulemaking that requires stripping out the most volatile elements from Bakken crude before it is loaded onto rail cars.
  • Expedite the issuance of a final rulemaking to require the full implementation of PTC technology for all railroads transporting lighter crude and provide a status report on the progress of PTC implementation to date.
  • Expedite the issuance of a rulemaking that requires phasing out old rail cars for newer, retrofitted cars.

We believe that we must be vigilant and put in place strict safety regulations that can adapt and meet the rapidly changing transportation and energy needs of our country. Thank you for your continued elevation of these important safety issues, and we look forward to working with you on this matter.