Oil would come from unspecified North American sources, public told

If Valero Benicia Refinery gets permission to transport some of its crude by rail, the oil would come from North American sources and would arrive in tanker cars that are stronger than the ones that comply with current federal regulations, refinery officials said Monday.

The refinery and its Community Advisory Panel organized the public meeting to explain the project as well as to reassure residents who have worried about the type of crude — whether heavy and sour Canadian tar sands oil or lighter, sweeter and more volatile Bakken field oil — the trains would bring into the refinery.

Valero has sought permission for a three-track extension so some of the crude it processes can be brought to the refinery by rail instead of by ship or pipeline, two methods the refinery already uses.

Valero also already ships some of its products out by Union Pacific trains, Don Cuffel, Valero Benicia Refinery manager of the Environmental Engineer Group, said Monday.

Cuffel described the proposed project as extending an existing rail line that would become divided into three tracks on refinery property, built to accommodate 50-car trains.

He said the tanker cars would be divided into two groups of 25, placed on two of the tracks. The third track would be for storing empty cars awaiting departure.

Oil transferred from the rail cars would enter the refinery’s own tank, pipeline and refining system, Cuffel said. He declined to specify exact sources of that crude, citing anti-trust regulations and a reluctance to reveal “proprietary” information to competitors.

However, he said, the refinery could be in the market for any North American oil that met the specific gravity and sulfur content limitations set by Valero’s permits.

That includes the possibility of oil from both the Bakken fields and Canada — neither of which, taken by themselves, falls within Valero’s permitted limits on raw materials.

However, any blend of crudes that meets the right levels of gravity and sulfer could be shipped to the local refinery, Cuffel said.

“Any viable crude we can safely refine, we will,” he said.

But current permits wouldn’t let Valero produce additional emissions, he noted.

“Opponents allege they would increase, but that’s not true,” Cuffel said. “Locomotives emit less than ships,” and emissions would decline during delivery on a per-barrel basis, he said.

Nor would refinery emissions themselves increase during processing, because the Bay Area Air Quality Management District restricts how much in emissions the refinery can produce, he said.

The refinery already has reduced its sulfur emissions by 95 percent and nitrogen oxide by 55 percent by the installation of a flare gas scrubber, Cuffel said.

“This does not change the process, just the delivery of the crude,” he said of the crude-by-rail project. “There is no change to the refining process.”

Nor would the move increase Valero’s output. The refinery is restricted to producing no more than 165,000 barrels a day, Cuffel noted.

Valero Benicia Refinery General Manager John Hill said Valero receives 350,000 barrels of crude by ship every five to seven days. The rail project, if approved and built, would substitute 70,000 barrels daily in crude brought in by train.

It would provide 120 construction jobs while the project is built, and a net increase of 19 permanent jobs compared to current staffing, Hill said, once crews begin unloading oil from rail cars instead of from ships.

Should a spill or derailment occur, how it would be handled would depend on where the accident happened, said Chris Howe, the refinery’s director of health, safety, environment and government. If it is on Valero property, the refinery’s own emergency responders would be responsible for handling its effects, though Valero has emergency response agreements with surrounding communities, including Benicia.

The refinery’s safety department is equipped to handle medical, fire and hazardous materials emergencies, Howe said, and has a staff that includes state-certified firefighters and emergency medical technicians.

“We train with the Benicia Fire Department,” he said, and Valero employees have assisted the municipality’s fire department through mutual-aid agreements, such as during the 2007 Big O Tire Store fire and a wildfire last year on Reservoir Road.

“We respond to emergencies with any agency,” Howe said.

If an emergency happened off Valero’s property, Union Pacific Railroad would take the lead in the response, he said, but Valero’s teams would be available to assist not only in Benicia but as far north as Roseville, where the railroad maintains one of its largest yards.

Both the refinery and the railroad stressed they were taking safety seriously.

Cuffel reminded the audience that for the third year, Valero has been determined by California Occupational Safety and Health Administration (Cal-OSHA) to qualify as a Voluntary Protection Star Program recipient.

He told the audience that Valero Benicia Refinery deals daily with raw materials and products that are considered hazardous materials, but does its work with a risk management approach.

“We manage risk,” he said. “Crude is a toxic material. It’s all about managing risk.”

Railroads come under federal jurisdiction, not that of states, counties or cities, something that has surprised and at times frustrated speakers at Benicia City Council and Planning Commission meetings.

Unlike freight delivery trucks, trains are told by the federal government what they can deliver.

“We are a Class One freight carrier,” said Liisa Lawson Stark, director of public affairs for Union Pacific Railroad. Federal law requires UP to carry such cargo as crude oil. “It’s not an option.”

Its dispatching center is in Omaha, Neb., which she compared to a “gigantic traffic control center.”

In response to inquiries about spills, she said all — even minor ones that don’t require emergency responses — are reported “as a matter of practice.”

Another speaker, Phillip Daum, senior managing consultant and engineer at Engineering Systems Inc., has investigated freight and transit railroad accidents and the cargo and carrier cars involved.

Daum participated in the probes of last year’s fatal derailment and explosion of a runaway oil train at Lac-Megantic, Quebec, Canada, spending a dozen days there documenting information.

He also was part of the investigation into the fiery incident at Casselton, N.D., in late December, in which a soybean train derailed and an oil train crashed into it and exploded while traveling on a parallel track. And Daum was involved in the inquiry into the Plaster Rock, New Brunswick, Canada derailment in January.

He said Monday he was unable to speak about some of the findings of those investigations, because they are ongoing. But he said the U.S. National Transportation Safety Board, Canada’s Transportation Safety Board and the Department of Homeland Security are collaborating on a tank car safety project and getting “information from the accidents and studying to evaluate what works and what doesn’t.”

He said the safety project has the endorsement of the Association of American Railroads, and car suppliers and shippers are anxious to see “what can be done.”

Daum said other decisions may be made based on information from those accidents, such as increasing track inspections or slowing speeds for trains with more than 20 crude-carrying cars, or placing tanker cars among other types of rail cars instead of having trains with just one type of car.

“The biggest thing is, there is a lot of effort going into understanding the accidents,” he said, with the U.S. Department of Transportation, the NTSB and Congress “working to improve crude by rail.”

None of the accidents Daum has investigated involved Union Pacific trains, though the North Dakota collision involved BNSF trains that also travel in the Bay Area.

In February, BNSF announced it would buy up to 5,000 crude oil tank cars with safety features, including thicker walls, stronger ends, better pressure valves and other features that exceed industry standards that were upgraded in October 2011 to meet the recommendations of the AAR trade group.

Daum praised BNSF’s move in that direction, calling the company “a leader” in the move to safer tanker cars.

He expected the industry and its regulators to follow that lead. “I have confidence in the process,” he said.

BNSF’s move to buy cars is unusual in the industry — most railroads only own tracks and locomotives. The cars they pull are usually owned either by the client companies themselves or they are leased from other companies.

Stark said UP is one of those railroads that doesn’t own cars. But it supports Association of American Railroads’s stand in calling for sturdier oil cars, she said.

Saying UP has joined AAR’s recommendation for the Department of Transportation’s adoption of stronger tank car standards, she said, “We don’t waver on that.”

She said UP has a strong safety record on transporting myriad types of cargo, especially hazardous materials.

“Safety is our number-one priority — safety for the public, for our employees and our customers. Everything is treated as important with regard to safety,” she said.

The oil would not come in DOT-111 tanker cars, such as the ones that exploded and burned in 2013 in the Lac-Megantic incident, said Tom Lam, Valero senior staff project engineer and project manager.

Instead, he said, about 5,000 upgraded models with reinforced exteriors that exceed federal specifications have been ordered by the refinery. “They are based on the new design with extra protection,” he said.

Some of the residents’ concerns about the environmental impact of the project are expected to be addressed in the draft Environmental Impact Report (EIR) now being developed by the city of Benicia to meet California Environmental Quality Act (CEQA) requirements.

When scheduled, Monday’s meeting was intended to be a public forum taking place in the middle of the public comment period after the release of the draft EIR.

But the city announced earlier this month that the report, initially expected to be released late last year or in January, won’t be ready until April.

That’s because of both the scope of the review and the quantity of comments and questions Benicia received and must address in the report.

The draft EIR, led by the city of Benicia, analyzes the project’s effects on multiple areas of the community, from construction equipment fumes and locomotive exhaust on air quality to how spills might taint neighboring marshland.

It’s also looking at local traffic patterns, noise production, bird nesting seasons, how any discovered cultural artifacts would be protected and how any other harmful aspects of the project would be avoided or mitigated.

One of those attending Monday asked about the traffic impact, particularly as it would affect Bayshore Road businesses.

Stark said UP would schedule the trains late in the day, and an earlier traffic study recommended against train arrivals at peak commuter times or at lunch.

Not only does the railroad have to consider those constraints, it also must deal with freight and Amtrak traffic — including the Capital Corridor commuter from the Bay Area to Sacramento — on its tracks.

Initial studies conducted before the EIR began indicated five construction areas and one operating area would need mitigation, but nothing was found to be of significant impact, said Lynn McGuire, Environmental Resource Management’s Western Division air quality and climate change consultant.

Some members of the audience asked how an earthquake would affect the trains and cars full of oil, a topic being explored in the EIR after initial examinations indicated that even a magnitude 7 quake would shake an oil-laden train only 2 inches, Cuffel said. “It wouldn’t topple a car,” he said.

After the EIR is released and the public comment period closes, the city will decide whether to certify the EIR, Cuffel said.

However, the refinery also will be dealing with other regulators, such as the Bay Area Air Quality Management District, which must decide whether to authorize the project’s construction and operation.

Howe said this won’t be the only informational meeting Valero will have on its project.

“We will have a meeting after the EIR is released,” he said.