Repost from The Sacramento Bee [Editor: The Bee presents a good summary of uprail critiques of Valero’s plan, quoting City staff, Valero and the CEO of the American Petroleum Institute. Note that organized local opposition has also been strong and persistent. – RS]
Benicia plans more study of crude-oil train impacts
By Tony Bizjak, 02/03/2015
In this July 24, 2014 file photo, an investigator photographs the scene where a locomotive and cars carrying crude oil went off the track beneath the Magnolia Bridge in Seattle. Mike Siegel / AP Photo/The Seattle Times
A controversial proposal by the Valero Refining Company in Benicia to run two 50-car crude-oil trains a day through Sacramento and other Northern California cities to its bayside refinery has hit another slowdown.
Benicia officials on Tuesday said they have decided to redo some sections of an environmental impact analysis of the project. The city plans to release a rewritten report June 30 for public review and comment over the summer.
The city’s decision comes after numerous groups, including Sacramento leaders, state Attorney General Kamala Harris and state oil spill prevention officials, called Benicia’s review of the project inadequate.
Those critics said Benicia failed to analyze the potential impacts of an oil spill and fire in cities, waterways and rural areas along the rail line, and also did not analyze the project’s potential impacts east of Roseville in environmentally sensitive areas such as the Feather River Canyon. They also challenged Benicia’s assertion that an oil spill between Roseville and Benicia would be a once-in-a-111-year event.
Crude-oil rail shipments have come under national scrutiny in the last year. Several spectacular explosions of crude oil trains, including one that killed 47 in a Canadian town in 2013, have prompted a push by federal officials and cities for safety improvements.
Sacramento and Davis leaders have called on Benicia to require the Union Pacific Railroad to give advance notice to local emergency responders, and to prohibit the railroad company from parking or storing loaded oil tank trains in urban areas. Local officials want the railroad to use train cars with electronically controlled brakes and rollover protection. Sacramento also has asked Benicia to limit Valero to shipping oil that has been stripped of highly volatile elements, including natural gas liquid.
Valero officials had said they hoped to begin receiving crude oil by trains early this year. In an email to the Bee, Valero spokesman Chris Howe said, “The proposed steps (by Benicia) are part of the process which we expect will allow the city to grant us a use permit for the project.”
In a hearing Tuesday in the U.S. House of Representatives in Washington, D.C., Jack Gerard, the president and CEO of the American Petroleum Institute, lamented that lengthy reviews were holding up the development of the country’s energy resources, including the Keystone XL pipeline, which has been under review by the State Department for seven years.
Gerard said some opponents were turning the process into a referendum on fossil fuels. “What we’re seeing across the country today is there’s a small group of individuals who are using permitting processes and infrastructure as surrogates to stop economic activity that they disagree with,” he told the House Subcommittee on Railroads, Pipelines and Hazardous Materials.
Groups Question Industry Influence on Oil Train Safety Rules
Freedom of Information Requests Target Five Federal Agencies, Nearly 100 Lobbyists
By Eddie Scher, Jan 15, 2015
Today four public interest groups requested records exchanged between five US government agencies and nearly 100 oil and rail industry representatives on new oil train safety standards. The Department of Transportation announced yesterday that the agency would miss the January 15 deadline set by Congress and issue final rules by May 12, 2015.
“New oil train safety standards are decades late: the National Transportation Safety Board first called antiquated DOT-111 tank cars unsafe for hauling crude oil in 1991,” says Ross Hammond, ForestEthics US campaigns director. “But the administration seems to have trouble asking the oil and rail industry for common sense safety standards like speed limits, sharing information with firefighters, and a ban of the most dangerous cars.”
The Freedom of Information Act requests filed by ForestEthics, Communities for a Better Environment, Ezra Prentice Homes Tenants Association (Albany, NY), and Citizens Acting or Rail Safety (La Crosse, WI) name 97 individual lobbyists from the American Petroleum Institute, Association of American Railroads and specific oil and rail companies, including Chevron, Tesoro, and Burlington Northern Santa Fe (BNSF). Among the lobbyists named are six former members of Congress: Trent Lott, Vin Weber, John Breaux, Steve LaTourette, Max Sandlin and Bill Lipinski.
“The public has the right to know how an army of lobbyists is influencing the Department of Transportation,” says Ross Hammond, ForestEthics US campaigns director. “Oil trains carrying millions of gallons of toxic, explosive crude oil threaten the 25 million Americans who live in the blast zone. DOT should listen their own safety experts and quickly finalize strong new standards that take DOT-111s off the tracks, slow these trains down, prepare first responders and protect families.”
Government agencies and officials covered by this FOIA request are US Department of Transportation, National Transportation Safety Board, Surface Transportation Board, Federal Railroad Administration, and Pipeline and Hazardous Materials Safety Administration (PHMSA).
##
ForestEthics demands that corporations and government protect community health, the climate, and our wild places. We’ve secured the protection of 65 million acres of wilderness by pushing major companies to shift hundreds of millions of dollars to responsible purchasing. www.ForestEthics.org
Repost from The Sacramento Bee SOAPBOX [Editor: I am somewhat reluctant to post the following article, an oil and rail industry promotion piece by the CEO and Founder of the Institute for Energy Research (IER). Wikipedia: “Praised by Rush Limbaugh as the ‘energy equivalent’ of the Heritage Foundation…. IER has received funding from… the Claude R. Lambe Charitable Foundation, which is run by executives of Koch Industries, an oil industry giant known for its massive political involvement. They have also previously received funding from ExxonMobil and from the American Petroleum Institute.” So… I would describe what follows as an inside peek at the current industry spin on crude-by-rail. Proceed with a unit train barrel-full of healthy skepticism. – RS]
Shipping oil by rail lowers energy costs
By Robert L. Bradley, Special to The Bee, 11/06/2014
A tanker truck is filled from rail cars containing crude oil at McClellan Park in March. Following a lawsuit, the oil company is ending transfer operations there this week. | Randall Benton/Sacramento Bee file
Chalk up a hollow victory for EarthJustice and the Sierra Club. The two environmental groups sued over InterState Oil Co.’s permit to unload oil trains at the former McClellan Air Force Base in Sacramento County.
The company plans to end operations there on Friday, after the regional air quality district said it issued the permit in error without doing a full environmental review. The groups are ecstatic, trumpeting the first California “crude transport project that has been stopped dead in its tracks.”
But before attempting to use the same legal tactics to halt oil trains elsewhere, the activists should examine the ramifications of their actions. Chances are they are hurting the very people and the environment they seek to protect.
Americans rely on fuels and countless other goods produced from crude oil in the nation’s refineries. Blocking oil trains will result in the market finding other ways to transport oil from wells to refineries, whether through new pipelines, on barges, by tanker or by truck. Environmentalist-created bottlenecks could artificially raise prices for consumers.
Shipping oil by rail was encouraged by President Barack Obama – the environmentalist-in-chief – when he delayed the Keystone XL pipeline. Railroads became the next-best method of transporting oil from the Upper Midwest to Gulf Coast refineries, making oil trains a permanent fixture on America’s landscape. Now, an alternative pipeline through Canada has emerged.
According to the federal Surface Transportation Board, nearly 1 million barrels of crude per day is being shipped by rail, 10 percent of all oil produced in the United States. In Canada, oil-train shipments have increased fourfold since 2012 and are continuing to grow.
Railroad revenues also have risen sharply. Federal statistics show major railroads earned $2.2 billion in 2013 from hauling crude oil, up from $26 million in 2008. With financial results like these, railroads are building new terminals to handle more oil. Although terminals are not cheap – a large one built by independent oil company EOG Resources in North Dakota cost $50 million – they are far less expensive than pipelines.
Trains have a strong safety record, and efforts are underway to make them even safer. The American Association of Railroads has volunteered to update its operating practices, called for tank car improvements and is ensuring that local officials and first responders are aware of the materials being shipped through their communities.
Likewise, the American Petroleum Institute has issued a new standard for rail shipments and is working with the railroads and the government on safety. The goal is to reduce the likelihood of accidents to zero.
“North America’s rail network moves hazardous materials without incident 99.998 percent of the time. The challenge for both industry and regulators is to address and eliminate the remaining .002 percent,” API President and CEO Jack Gerard recently told reporters.
Consumers are benefiting from oil trains, especially in the West. Because there are no major pipelines from oil fields in the heartland through the Rockies, West Coast refiners have been relying largely on imports and Alaskan oil. Even with the added expense of shipping oil by train from North Dakota – where crude oil costs about $15 a barrel less – refiners are able to lower their costs, which helps to lower or stabilize consumer prices.
Producing domestic oil is creating thousands of jobs, improving our energy security and enhancing our economic prospects. As U.S. oil production rises, it will find a way to the marketplace. The American dream needs some help from oil being transported by the safest means possible, not shortsighted environmental lawsuits.
Our market-driven economy has no incentive to spill oil or harm people and the environment. Lawsuits filed by anti-fossil fuel groups might disrupt some train traffic, but they are not going to prevent oil from being drilled, transported and consumed. To truly help the environment, these groups would be better served by working on real environmental problems.
Robert L. Bradley Jr. is CEO of the Institute for Energy Research, a Washington, D.C., advocacy group whose funders include oil companies.
Many railroad companies want more time to retrofit cars in the U.S. and Canada, but some are forging ahead.
By Joe Eaton for National Geographic, October 31, 2014
Smoke rises from railway cars that were carrying crude oil and derailed in downtown Lac-Megantic, Quebec, in 2013. Regulators in Canada and the United States have been working on new standards for trains that carry flammable fuel. – Photograph by Paul Chiasson, Associated Press
Three days after an oil train derailed and exploded in 2013 in Lac-Mégantic, Quebec, killing 47 people, Greg Saxton wandered through the disaster site inspecting tank cars.
For Saxton, the damage was personal. Some of the tank cars were built by Greenbrier, an Oregon-based manufacturer where he’s chief engineer. Almost every car that derailed was punctured, some in multiple places. Crude oil flowed from the gashes, fueling the flames, covering the ground, and running off into nearby waterways.
Each day, as Saxton returned to the disaster zone, he passed a Roman Catholic church. “We never came and went when there wasn’t a funeral going on,” he said.
In the wake of this and other recent accidents as energy production soars in North America, Canadian and U.S. regulators are proposing new safety rules for tank cars that carry oil, ethanol, and other flammable liquids. Saxton and Greenbrier have pushed for swift changes, but others in the industry are asking for more time to retrofit cars like the type that exploded at Lac-Mégantic. (See related stories: “Oil Train Derails in Lynchburg, Virginia” and “North Dakota Oil Train Fire Spotlights Risks of Transporting Crude“)
“If you don’t set an aggressive time line, you won’t see improvements as quickly as the current safety demands require,” Jack Isselmann, a Greenbrier spokesman, said. “We’ve been frankly just perplexed and confused by the resistance.”
Industry Pushes for More Time
The tank cars that derailed at Lac-Mégantic were built before October 2011, when the American Railway Association mandated safety enhancements to the oil and ethanol tankers known in the industry as DOT-111 cars. The cars lacked puncture-resistant steel jackets, thermal insulation, and heavy steel shields, all of which could have lessened the destruction, experts say.
In July, the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) proposed rules that, if finalized, would require higher safety standards for new oil cars. The rules also require owners to retrofit older cars or remove them from the rails by October 2017.
Canadian regulators in July mandated that DOT-111 tank cars built before 2014 be retrofitted or phased out by May 2017. Transport Canada, which regulates rail safety, has also proposed aggressive safety standards for new tank cars and will seek industry comment this fall before finalizing its rules.
Saxton and others at Greenbrier support the proposed regulations, which could be tremendously lucrative to the company. However, others in the rail supply industry say the proposed retrofit time line cannot be met.
The Railway Supply Institute—a trade organization that represents the rail industry—has asked DOT to allow legacy cars in the oil and ethanol fleet to remain on the rails until 2020.
Thomas Simpson, the institute’s president, said a survey of rail maintenance and repair shops found that only 15,000 of the roughly 50,000 non-jacketed legacy tank cars in the crude oil and ethanol fleet can be modified by the proposed 2017 deadline.
For many cars, the retrofit process would include adding thermal protection systems, thick steel plates at the ends, and outer steel jackets, as well as reconfiguring the bottom outlet valve to ensure it does not break off and release oil during a derailment.
That’s too much work to complete before the deadline, and the regulations have not yet been finalized, Simpson said.
The proposed deadline, he said, will “idle cars waiting for shop capacity and adversely affect the movement of crude and ethanol.”
In comments to U.S. regulators and the press, API tied the safety upgrades to approval of the proposed Keystone XL pipeline, which would transport Alberta’s tar sands oil through the Midwest to Texas refineries.
The deadly oil train accident at Lac-Megantic, Quebec, raised awareness of the potential dangers of transporting crude by rail. – Photograph by Ryan Remiorz, Associated Press
Both API and the Rail Supply Institute have also warned regulators that a short time line for retrofitting oil cars could cause a spike in truck shipments of oil and ethanol.
But Anthony Swift, an attorney with the Natural Resources Defense Council, an environmental group opposed to Keystone XL, called these arguments misleading. Swift said Keystone XL would have little impact on retrofitting tank cars, because most train traffic from the Bakken oil fields in North Dakota moves to East Coast and West Coast refineries. He said that traffic would not be affected by the pipeline.
Keystone XL would have the capacity to carry 830,000 barrels of oil-sands crude a day, with up to 100,000 barrels a day set aside for crude from the Bakken. By 2016, the rail industry in Canada is expected to carry about as much oil as Keystone XL would. The U.S. rail industry is already there: Almost 760,000 barrels a day of crude had traveled by rail by August.
Swift said the costs to the oil industry are worthwhile if lives are saved. “The argument that we need to wait until the oil industry does not need tank cars until we can make them safe is ridiculous on its face,” he said.
Greenbrier Gears Up to Meet Demand
In February, Greenbrier introduced a beefed-up tanker with a 9/16-inch steel shell (1/8-inch thicker than many DOT-111 cars), 11-gauge steel jacket, removable bottom valve, and rollover protection for fittings along the top of the cars.
Greenbrier calls the tanker the “car of the future,” saying it’s eight times safer than the DOT-111. Isselmann said Greenbrier has received more than 3,000 orders for the new car and plans to double its manufacturing capacity by the end of the year.
In June, Greenbrier and Kansas rail-service company Watco joined forces to form GBW Railcar Services, creating the largest independent railcar repair-shop network in North America. Isselmann said the company plans to hire 400 workers and start second shifts at its factories to meet demand for retrofitting DOT-111 tank cars.
In comments to U.S. regulators, GBW said it currently has the capacity to retrofit more than 10 percent of the fleet of DOT-111 tank cars.
Isselmann said that number will grow as other companies take advantage of the market once regulators release final rules. For that reason, he said the industry’s current capacity to meet regulations is less important than its ability to ramp up quickly to capture the increased business that new safety standards could bring.
“This notion that the status quo is going to remain—it’s diversionary at best,” Isselmann said.
Almost every tanker in the Lac-Megantic accident was punctured. New standards would mandate stronger cars, among other measures. – Photograph by Ryan Remiorz, Associated Press
Some in the industry are responding to public concern before rules are finalized. In April, Irving Oil—the owner of Canada’s largest refinery, in Saint John, New Brunswick, where the Lac-Mégantic train was headed before the disaster—completed a voluntary conversion of its crude oil railcar fleet.
Also in April, Global Partners, one of the largest U.S. distributors of gasoline and other fuels, began requiring all crude oil unit trains making deliveries at its East and West Coast terminals to meet October 2011 safety standards for tank car design.
“As an industry, we have both an opportunity and a responsibility to maximize public confidence in the safety of the system that carries these products across the country,” Eric Slifka, Global Partners’ CEO, said in a press release.
A Push to Harmonize Regulations
As the U.S. and Canada consider train safety regulations, oil and rail companies are pushing to ensure that the same tank cars can be used to haul flammable liquids in both countries.
Regulators say they are working together to make that happen. Lauren Armstrong, a spokeswoman at Transport Canada, said the department is holding technical discussions on new tank car standards with the U.S. Department of Transportation and the Federal Railroad Administration.
However, coordinating tank car regulations between the two countries would have to overcome current gaps, industry representatives say.
In April, Transport Canada banned the use of the oldest and least crash-resistant DOT-111 tank cars, which lacked bottom reinforcement. The U.S. so far has not banned the cars from carrying oil and ethanol.
Canada also set a 2017 deadline for retrofitting the cars. In the U.S., regulators are expected to release final rules by early 2015. The process, however, could continue much longer.
The strongest standards will carry the day, said Thomas Simpson, the president of the Railway Supply Institute. Given the large amount of oil that moves between the two countries, Simpson said it makes no business sense for companies to keep two different sets of cars to meet the two sets of rules.
Communities Concerned About Safety
But as final rules are being hammered out in the U.S., some train safety advocates and community groups worry they are being left out of the process.
But she said rail and oil industry lobbyists have had much more access to policymakers than community advocates, and she’s concerned they will have a greater impact on final rules.
“The inside players, the guys in the industry,” she said, “they seem to be able to be in front of the decision-makers more than we have been.”
