Tag Archives: American Petroleum Institute (API)

US eases crude oil export ban; allows trading with Mexico

Repost from Associated Press – The Big Story

US eases crude oil export ban; allows trading with Mexico

By Josh Lederman, Aug. 14, 2015 3:34 PM EDT

AssociatedPressEDGARTOWN, Mass. (AP) — The Obama administration approved limited crude oil trading with Mexico on Friday, further easing the longstanding U.S. ban on crude exports that has drawn consternation from Republicans and energy producers.

Mexico’s state-run oil company Petroleos Mexicanos, or Pemex, had sought to import about 100,000 barrels of light crude a day and proposed a deal last year in which Mexico would trade its own heavier crude for lighter U.S. crude. A major crude exporter for decades, Mexico has seen its oil production fall in recent years.

The license applications to be approved by the U.S. Commerce Department allow for the exchange of similar amounts of U.S. and Mexican crude, said a senior Obama administration official, who wasn’t authorized to comment by name and spoke on condition of anonymity. The official didn’t disclose whether all 100,000 barrels requested would be allowed.

While the Commerce Department simultaneously rejected other applications for crude exports that violated the ban, the move to allow trading with Mexico marked a significant shift and an additional sign that the Obama administration may be open to loosening the export ban. Exchanges of oil are one of a handful of exemptions permitted under the export ban put in place by Congress.

The export ban is a relic of the 1970s, after an OPEC oil embargo led to fuel rationing, high prices and iconic images of long lines of cars waiting to fuel up. But Republicans, including House Speaker John Boehner, have said those days are long gone, arguing that lifting the ban could make the U.S. an energy superpower and boost the economy.

Republicans from energy-producing states hailed the decision, as did trade groups representing the oil industry. Sen. Lisa Murkowski of Alaska, who has pushed for lifting the ban, called it a positive step but added that she would still push for full repeal “as quickly as possible.”

“Trade with Mexico is a long-overdue step that will benefit our economy and North American energy security, but we shouldn’t stop there,” said Louis Finkel, executive vice president of the American Petroleum Institute.

But environmental groups have opposed lifting the ban out of concern it would spur further drilling for crude oil in the U.S. Pemex’s proposal has also drawn criticism in Mexico, where residents are sensitive about the country’s falling oil production despite warnings from officials that Mexico could become a net importer if it doesn’t explore new oil reserves.

The move to trade crude with Mexico comes as the Obama administration weighs a long-delayed decision about whether to approve the Keystone XL pipeline. That proposed project would carry crude oil from Canada’s tar sands to refineries on the Texas Gulf Coast, so the influx of heavy crude from Mexico could play into a decision about whether the controversial pipeline is necessary.

Last month a Senate panel approved a bill championed by Murkowski that would lift the 40-year-old-ban — plus open more areas of the Arctic, Gulf of Mexico and the Atlantic Ocean to oil and gas exploration. No Democrats on the committee voted for the bill. The environmental group Oceana called it “a massive give-away to Big Oil.”

Most Recent Oil Train Accidents and Spills Involved ‘Safer’ CPC-1232 Tank Cars

Repost from DeSmogBlog

Most Recent Oil Train Accidents and Spills Involved ‘Safer’ CPC-1232 Tank Cars

By Justin Mikulka  | July 23, 2015 – 03:58

Roosevelt County chief deputy sheriff Corey Reum was one of the first responders to the recent Bakken oil train derailment in Montana, a few miles from the North Dakota border.

“We’re lucky it didn’t ignite,” Reum told ABC News.

That is just one of the things first responders have learned since the deadly accident two years ago in Lac-Megantic. As a Globe and Mail article marking that two year anniversary recently noted, when the train was on fire and rail cars were exploding in Lac-Megantic, no one could figure out why.

The Globe detailed the questions the investigators were trying to answer in the aftermath.

And, perhaps most puzzling of all: How did the crude oil on the train – normally thought of as difficult to light on fire – cause the kind of violent explosions it did?

Now we know that the Bakken oil is different from most other crude, and based on the eight accidents since July 2013 involving derailed trains that involved Bakken oil and resulted in fires, first responders now know the risk the Bakken oil presents.

In Roosevelt County they evacuated a half-mile perimeter around the crash site as a precaution even though there was no fire.

However, despite the lack of fire in this latest accident, 35,000 gallons of oil did spill as four tank cars ruptured. And these were the newer CPC-1232 tank cars that the oil industry is currently suing to keep on the rails even longer than the new regulations allow — which for some 1232 tank cars is not until 2025.

Click to enlarge

There have now been six accidents involving oil trains in 2015 where tank cars derailed and were punctured and oil was spilled. In the first five, there were also fires and explosions.

All six oil train derailments involved the new 1232 model cars that the American Petroleum Institute is suing to keep on the tracks longer than existing long timelines in the new oil-by-rail regulations.

Even Cynthia Quarterman, the former administrator of the Pipeline and Hazardous Materials Safety Administration, the agency responsible for the regulations, was surprised by the timelines in the final regulations.

That was the biggest surprise, by far,” Quarterman told Argus Media. “The push-back for five years for most things, I thought it was a substantial push-back in terms of dates.”

So while we have learned quite a bit in the two years since Lac-Megantic, not much has changed in how Bakken oil is moved by rail.

  • The oil industry has not addressed the volatile nature of the Bakken oil so it still presents serious fire and explosion risks.
  • The oil and rail industries are fighting the new regulation requirements for modern braking systems on the trains starting in 2021.
  • The oil will still be transported in the obviously inadequate CPC-1232 cars for up to ten years or longer if the oil industry wins its lawsuit.

So, as Sheriff Reum pointed out in his observation, the best strategy for communities along the oil train tracks across North America is to spend the next ten years or so hoping you get lucky.


Image credit: NTSB Safety Recommendation report.

NYU Institute for Policy Integrity: New oil train safety rules spell delay, leaving citizens at risk

Repost from The Hill

New oil train safety rules spell delay, leaving citizens at risk

By Jayni Hein, contributor, May 18, 2015, 10:00 am

Chicago, Philadelphia and Sacramento, Calif.: These are just a few of the cities within the “blast zones” of mile-long trains carrying flammable crude oil across the country. Twenty-five million Americans live in these vulnerable areas; yet it will be years until dangerous tank cars are retrofitted or retired from the rails, based on the U.S. Department of Transportation’s new safety standards.

The standards, released on May 1, cover railcars that carry the nation’s growing supply of volatile crude oil produced in the Bakken region of the northern United States and the Canadian tar sands. While the new rules mark incremental progress, they give residents little reason to rest easy. And more implementation delays could be coming — the American Petroleum Institute filed a petition in federal court on Monday challenging the new rules, and other legal challenges may be on the horizon.

When it comes to oil train derailments, it’s no longer a question of “if,” but “when.” Driven by growth in the production of oil in the U.S. and Canada, there has been a staggering increase in rail transportation of crude oil over the past five years, with a corresponding spike in the number of accidents — many causing explosions, oil spills and fatalities. The latest incident happened earlier this month, when a train carrying Bakken crude oil derailed and caught fire in central North Dakota, forcing the evacuation of a small town.

In 2008, only 9,500 tank car loads of crude were transported by rail in the United States. By 2013, that number rose to 400,000. In 2013, more oil spilled from U.S. trains than in the previous four decades combined. In addition to putting citizens directly at risk, these trains pass over important sources of drinking water — such as the Sacramento River in drought-stricken California — and share track with commuter rail in many urban areas, including Philadelphia.

The Department of Transportation initiated a rule-making last year to update railcar design standards, speed limits and routing requirements for trains carrying 20 carloads or more of flammable crude oil. The agency’s final rule maintains some of the positive aspects of its proposed rule: new electronically controlled pneumatic brake requirements, lower speed limits for older tank cars moving through “high-threat urban areas,” and new routing analysis requirements.

But, in other ways, the final rule represents a step backwards from the Department of Transportation’s initial proposal. And more fundamentally, the rule puts a Band-Aid on a chronic condition caused by booming fossil fuel production, ongoing reliance on oil and aging transportation infrastructure.

First, the final rule exempts many trains that would have been made safer under the initial proposal. Originally, any train carrying 20 or more cars with flammable oil or ethanol was defined as a “high-hazard flammable train” subject to these standards. The final rule applies only to trains carrying at least 35 tank cars of flammable oil or ethanol, or 20 cars of flammable liquid in a continuous block. This final definition, then, encompasses fewer trains.

Second, the rule suffers from a lengthy, five- to eight-year retrofit or phaseout of DOT-111 and CPC-1232 railcars that have been known to puncture upon derailment for many years. These are the same cars that were involved in the Lac Mégantic, Quebec tragedy in July 2013 that killed 47 people and in the five major accidents in 2015 (thus far) in West Virginia, Illinois, North Dakota and two locations in Ontario. The protracted phaseout means many additional years of dangerous tank cars sharing track with commuter rail, traveling through dense population centers, and crossing water bodies and other sensitive environmental habitats. The delay is especially striking, as National Transportation Safety Board reports dating back to 1991 detail the high failure and puncture rates of DOT-111 tank cars. However, the agency determined that a quicker phaseout of DOT-111 cars would cause negative effects by temporarily shifting oil transportation from rail to trucks, increasing hazardous air pollution and traffic-related fatalities.

Finally, while the rule imposes 40-mph speed limits for non-retrofitted trains traveling through “high threat urban areas,” only a few dozen cities around the nation have been so designated, leaving many towns, cities and drinking-water sources highly vulnerable.

In the next year, the Department of Transportation should prioritize additional measures, like increasing railcar and track inspections, lowering speed limits in additional urban areas, sharing risk reduction “best practices” among the railroads and potentially tightening design standards for retrofitted cars to align with the standards for new cars.

The department should also coordinate closely with the states to modernize communication systems, improve spill prevention and response planning, ensure that states are empowered to train and fund additional rail inspectors, and collaborate to identify high-priority infrastructure needs, such as bridge and track improvements.

Ideally, these safety improvements should be made as part of an “all of the above” strategy to reduce our reliance on fossil fuels while ensuring that domestic production and transportation are as safe as possible in the near-term. The new rail safety rules are a necessary first step on what looks to be a long, uncertain journey.

Hein is the policy director at the Institute for Policy Integrity, focusing on climate change, energy and transportation issues.

Oil industry sues U.S. over train safety rules

Repost from The Fresno Bee

Oil industry sues government over train safety rules

By Curtis Tate, McClatchy Washington Bureau, May 12, 2015

The oil industry went to court Monday over the Obama administration’s new oil train safety rules, challenging the timeline for refitting tens of thousands of tank cars and the requirement for enhanced braking systems on the cars.

In its petition for review, filed Monday in the U.S. Court of Appeals for the District of Columbia Circuit, the American Petroleum Institute called the provisions, unveiled May 1 by the U.S. Department of Transportation, “arbitrary, capricious, (and) an abuse of discretion.”

The industry group asked the court to set aside the provisions. It did not challenge the department’s new standard for newly constructed tank cars carrying crude oil, ethanol and other flammable liquids.

The lawsuit names Transportation Secretary Anthony Foxx, Attorney General Loretta Lynch and Tim Butters, acting chief of the Pipeline and Hazardous Materials Safety Administration, the agency tasked with enforcing the rules.

In public statements and filings, the oil industry hinted that it would take legal action against the department’s new rules. It had said that the department’s proposed timeline for retrofitting the large fleet of DOT-111 tank cars wasn’t realistic. It also said that the benefits of installing electronic brakes on the tank cars didn’t justify the cost.

The rail industry’s principal trade group, the Association of American Railroads, also opposed the braking requirement, though it was more supportive of the retrofit timeline.

When asked about a potential legal challenge to its rules, Foxx said he expected that the courts would uphold the department’s power to regulate rail transportation.

“We believe strongly that our rule will stand up,” Foxx said on May 1.

This post has been updated to correct the federal court the suit was filed in.