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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