Tag Archives: Bakken

Rail officials: older tank cars have 1 in 4 chance of leaking if they derail

Repost from The Star Tribune – Business, Minneapolis, MN

Failure rates raising new fears over use of aging oil tankers

 Article by: JIM SPENCER , Star Tribune   |  April 22, 2014

Rail industry estimated their chance of leaking in derailments at 1 in 4.

A BNSF Railway train hauled crude oil near Wolf Point, Mont, in November. A National Transportation Safety Board forum on Tuesday looked at the safety in transporting crude oil and ethanol. One focus was the use of older tank cars, especially as oil train traffic increases.  Photo: Associated Press file.

WASHINGTON – Tens of thousands of older tanker cars used to haul North Dakota crude oil and Midwestern ethanol run a one-in-four risk of leaking if they derail, railroad officials told the National Transportation Safety Board (NTSB) Tuesday.

The failure rate, estimated by the Rail Supply Institute and the American Association of Railroads, illustrates a growing concern for safety that has accompanied skyrocketing shipments of crude oil across the country.

Crude oil shipments originating in the United States have grown from about 6,000 carloads in 2005 to roughly 400,000 in 2013 as the United States has tapped domestic petroleum sources. At the same time, the government has yet to issue new standards for safer tanker construction.

About six North Dakota oil trains per day travel across Minnesota and through the Twin Cities, many of them 100 cars long. Each tank car holds 25,000 to 30,000 gallons of crude oil. Ethanol trains, which pose a similar hazard, move on Union Pacific tracks through the state.

But recent fiery crashes have convinced some policymakers that the threat of derailments like the one that happened in December in North Dakota put the public at unacceptable risk.

“A spate of recent accidents in the United States and Canada [demonstrate] that far too often, safety has been compromised,” NTSB chairwoman Deborah Hersman said.

While the rail industry says it moves 99.9 percent of its crude oil shipments incident-free, industry data show that 46,400 rail cars have been damaged in 29,000 accidents since 1970.

The older, general-use tanker cars hauling oil and ethanol meet current government safety standards, but government videos on the first day of a two-day forum about safety in crude oil and ethanol transport showed an older car rupturing during a puncture test, spraying its contents over the test site.

“Taking [older cars] out of the fleet reduces risk,” Robert Fronczak of the Association of American Railroads told the board.

But, he said, eliminating them by attrition alone could take 40 to 50 years.

Setting new standards

The sturdier tank cars being built now are half as likely as the older model to spill contents in a derailment, the rail industry estimates. But car construction standards being discussed by the government could lower the chances of a derailment leak to less than one in 20.

However, the rail supply industry has “to have regulatory certainty” before it commits to major new tanker production and retrofitting of old cars, William Finn of the Railway Supply Institute told the board.

Lee Johnson, representing the American Petroleum Institute, questioned the spill data attributed to older, so-called “legacy cars.” He called the numbers “preliminary.”

Johnson said the oil industry needs to keep shipping oil in the older cars “to move increasing production.” There are not enough of the newer, sturdier tanker cars available to meet oil producers’ demands, especially in North Dakota’s Bakken field, which Johnson said will soon be producing 2 million barrels of oil per day.

Roughly 23,000 older “legacy cars” now carry crude oil, and 29,000 more carry ethanol. The United States may soon have even more crude oil moving in the more vulnerable rail cars because of a surcharge Canada now places on their use. That means railroads may divert newer, sturdier cars to haul oil to Canada.   Retrofitting older legacy cars to make them more leakproof will take years, if not decades, several participants said.

“We don’t want to disrupt the country’s need for the fuel these cars are hauling,” Finn said.

Why the details matter

Meanwhile, a better car design remains the subject of debate.

Greg Saxton, chief engineer of the Greenbrier Cos., one of the country’s four major train car builders, believes in greater tanker wall thickness. “Engineers deal with uncertainty by adding some margin of safety,” he explained to the board.

Others argue that thicker walls add weight and reduce storage space without improving safety.

Wall thickness is probably the biggest sticking point in the tanker safety discussion. The Railway Supply Institute wants a standard width of seven-sixteenths of an inch. The Association of American Railroads wants nine-sixteenths of an inch.

“Crude oil contains a significant amount of dissolved gas,” the railroad association’s Fronczak said. A nine-sixteenth-inch wall will contain the vapor pressure that can build inside a crude oil tanker.

Videos shown Tuesday explained why such minutiae might matter. In one, a train car with a thicker wall withstood the whack of a giant prod traveling 14.7 miles per hour, while a car built to current DOT 111 standards ruptured in a 14 miles-per-hour collision.

Other issues include reinforcing the ends of tanker cars where they are most likely to be struck in a derailment, installing pressure-relief valves on tankers to keep crude oil from exploding in the event of a derailment and applying additional thermal protection to cut the risk of fires.

The NTSB’s Hersman asked Johnson how long he felt the older, more vulnerable cars would be needed to haul crude oil.

When Johnson couldn’t provide a specific time frame, Hersman replied: “You’re not making me feel very optimistic.”

The legal quagmire of Lac-Mégantic

Repost from The Montreal Gazette

Plans are finally taking shape for financial compensation of derailment victims

By Monique Beaudin, Gazette environment reporter April 20, 2014
The legal quagmire of Lac-Mégantic
The light fades over the Appalachian Mountains in Lac-Mégantic a couple of weeks after the train derailment in July 2013. Eight months later, plans for compensation are coming together. Photograph by: Allen McInnis , Montreal Gazette

Nine months after a runaway oil train derailed in Lac-Mégantic, killing 47 people and destroying a large chunk of the town, a plan for financially compensating disaster victims is taking shape.

Judges in Quebec and Maine have approved a joint cross-border process for victims of the accident to file claims against Montreal, Maine and Atlantic Railway and its Canadian operations, Montreal, Maine and Atlantic Canada. The two companies have been under bankruptcy protection since August.

Thousands of claims related to the derailment are expected to be filed against MMA. Public information meetings on the financial-claims process are to begin in Lac-Mégantic next week. Claims must be filed by the middle of June.

People who lost family members, homes and businesses have turned to Canadian and American courts for financial compensation, but the process has been slow. The estates of several of the 47 people killed on July 6 have filed wrongful-death lawsuits in the U.S. Lawyers have also begun proceedings to bring a class action in Quebec. Quebec has already ordered six companies to clean up and decontaminate the town, a move that is facing a legal challenge.

The American lawyer overseeing MMA’s U.S. bankruptcy proceedings himself admits figuring out how victims will be compensated is “quite complicated”.

One of the biggest questions is who has the money to pay for the accident — compensating victims and secured creditors, covering cleanup costs and paying damages that several companies are claiming as a result of the derailment.

MMA was sold in January to New York-based Railway Acquisitions Holdings, for $14.25 million, less than what it owes its secured creditors.

That leaves a $25-million insurance policy and the possibility of a settlement fund composed of contributions from several companies targeted by legal action after the accident, said Robert Keach, MMA’s U.S. Chapter 11 trustee.

Another possible source of financial compensation for victims could come from a lawsuit Keach filed against World Fuel Services, Western Petroleum and Petroleum Transport Solutions, the companies that arranged for the shipment of the crude oil on the train. Keach argued they were to blame for the accident since the oil had been mislabelled as being less volatile than it actually was.

New York-based lawyer Luc Despins is counsel to a victims’ committee made up of residents, the town of Lac-Mégantic and the Quebec government. The committee represents victims’ interests in MMA’s American bankruptcy proceedings, offering input on issues like the compensation process, he said.

Despins said the committee’s goal is to get as much money as possible to the Lac-Mégantic victims as quickly as possible. But, he cautioned, not all claims filed may be accepted.

“If someone agrees their house was worth $600,000 and they got the full $600,000 from their insurance company, and that’s their only claim, they should not be recovering twice, this is not a lottery,” he said. “They may have other claims, but as far as the house I gave as an example is concerned, they can’t recover twice.” The courts will decide who has a valid claim, Despins said.

LOGISTICS: WHAT’S NEXT FOR VICTIMS OF THE DISASTER

Victims of the accident have until June 13 at 5 p.m. to file a proof of claim against Montreal, Maine and Atlantic.

Public information meetings on the claims process are to be held in Lac-Mégantic between April 22 and May 5, and assistance will be provided to help people complete the claims forms, according to an order issued by Quebec Superior Court. Victims who do not file a claims form by June 13 will not be permitted to participate in the Canadian or U.S. bankruptcy proceedings or receive any payment made available in those proceedings.

Claims forms and information about the claims process are posted on the website of Montreal-based Richter Advisory Group, the company’s Canadian bankruptcy monitor, at www.richter.ca under “Insolvency Cases” or  http://bit.ly/mmamonitor.

LEGAL ACTIONS INVOLVING VICTIMS OF LAC-MÉGANTIC

A request has been filed to approve a class-action lawsuit in Quebec against MMA, World Fuel services, Irving Oil, Canadian Pacific, the federal government and others. More than 1,550 people have registered with the class action so far.

A committee of three Lac-Mégantic residents, a representative of the Quebec government and the town of Lac-Mégantic represents victims’ interests in MMA’s U.S. bankruptcy proceedings.

The estates of 19 people killed in the Lac-Mégantic train derailment filed wrongful-death lawsuits in Illinois, naming several defendants, including MMA, company chairman Edward Burkhardt, MMA’s parent company Rail World, and World Fuel Services, which arranged for the transportation of the crude oil on the train. All except two of those lawsuits have been withdrawn while American courts decide where they will be heard. A law firm representing the estates says it plans to appeal a recent decision from a U.S. federal judge ordering the cases transferred to Maine, where MMA’s bankruptcy proceedings are being held. One of the issues at play is the amount of money that could be awarded as damages. Illinois has no cap on such payments, while Maine limits them to $500,000 in wrongful-death cases.

POSSIBLE SOURCES OF FINANCIAL COMPENSATION

A $25-million insurance policy MMA has with XL Insurance. Many people and companies are interested in the insurance policy. They include:

– Victims of the Lac-Mégantic derailment, such as the families of people killed in the accident, those who were injured or those who suffered losses to their businesses or homes.

– CIT Group, a company that owned some of the locomotives and tank cars involved in the accident. CIT has said it plans to settle any claims against it from wrongful-death lawsuits tied to the derailment with the XL insurance policy.

– MMA chairman Edward Burkhardt, who has been named in several legal actions linked to the derailment, argued in U.S. bankruptcy court that he is covered by the policy.

Settlements from legal action taken by MMA’s bankruptcy trustee against World Fuel Services.

The creation of a settlement fund made up of financial contributions from companies that may be liable for the accident.

TIMELINE OF THE LEGAL FALLOUT

July 6, 2013: A 72-car oil train pulled by five locomotives unexpectedly rolls down railway tracks into the town of Lac-Mégantic. Most of the cars derail, leading to explosions and a fire that kills 47 people and destroys much of the downtown core. Nearly 6 million litres of crude oil spill in the accident.

July 15, 2013: Lac-Mégantic lawyer Daniel Larochelle and two other law firms file a request in Quebec Court to begin class action proceedings against MMA and 14 other companies and individuals.

July 22, 2013: Annick Roy files a wrongful-death lawsuit in Illinois court on behalf of the estate of Jean-Guy Veilleux and their daughter. Veilleux was killed July 6.

Aug. 7, 2013: MMA files for bankruptcy protection in Canada and the U.S.

Aug. 14, 2013: A total of 19 wrongful-death cases have been filed in Illinois court.

Aug. 22, 2013: The Quebec government announces the creation of a victims’ committee to represent Lac-Mégantic residents, the government and the town in the U.S. bankruptcy proceedings.

Jan 23, 2014: Bankruptcy judges in Canada and the U.S. approve the sale of MMA to Railway Acquisitions Holdings of New York for $14.25 million U.S.

Feb. 12, 2014: Lawyers for the proposed Quebec class action add Transport Canada to the list of more than 50 organizations and people it plans to sue.

Feb. 26, 2014: A joint Canada-U.S. bankruptcy meeting between creditors tries to speed up the pace of the claims process.

April 2014: The MMA sale to RAH is expected to be finalized.

June 13, 2014: This is the proposed deadline for victims and creditors to file claims against MMA in the Canadian and U.S. bankruptcy proceedings.

WHAT’S HAPPENING WITH MONTREAL, MAINE AND ATLANTIC

The railway company whose runaway oil train derailed in Lac-Mégantic on July 6, 2013. It is in the process of being sold to Railway Acquisition Holdings, a New York City -based company, for $14.25 million U.S. RAH plans to change the name of the company to Central Maine and Quebec Railway, and offer rail service on MMA’s 800 kilometres of tracks in the two countries.

RAH is acquiring two companies:

Montreal, Maine and Atlantic Railway

  • Parent company of Montreal, Maine and Atlantic Canada.
  • Operates a shortline railroad in Vermont and Maine.
  • Under Chapter 11 bankruptcy protection since August.

Montreal, Maine and Atlantic Canada

  • Railway operating in Quebec.
  • Under bankruptcy protection since August.

Changes in fossil fuel transport – maps of the Pacific Northwest

Repost from The Seattle Times
[Editor: Regarding CUMULATIVE IMPACTS, we in the San Francisco Bay Area need to learn from the Pacific Northwest.  Their maps are excellent – check out this great resource.  Who among us can work on this?  It seems to me that the Bay Area Air Quality Management District should be held responsible to prepare maps like this as soon as possible.  – RS]

Fossil fuels and spill risk: A changing landscape

By Seattle Times staff  |  April 19, 2014

Washington has long been a fossil fuel depot. But changes in how and where we get our oil — and the addition of proposals to export coal — are increasing the risk of spills and major accidents. Here is how fossil fuel distribution is changing.

(The maps and charts below are formatted as a single PNG IMAGE. Click on the image for a full-size readable version.)
fossil fuels and spill risk-A changing landscape(pacificnorthwest)
The maps and charts above are formatted as a single PNG IMAGE. Click on the image for a full-size readable version.

NY Times: More shipments, new accidents and calls for safety

Repost from The New York Times, Business Day [Editor – this NYT article was a detail sheet linked to the major article, “Despite Rise in Spills, Hazardous Cargo Rides Rails in Secret“.  I am posting here because it is a serious contribution to our understanding of the huge increase in rail disasters in 2013-14.  – RS]

More Shipments, New Accidents and Calls for Safety

    A sharp increase in rail shipments of oil over the past decade has been accompanied by accidents and derailments that have renewed the debate about regulating transportation of hazardous materials. The shipments are regulated by federal authorities; state and local officials have little say. Despite warnings of safety risks, measures to restrict or ban such transportation have been defeated.                      Related Article
More Shipments, New Accidents and Calls for Safety
More Shipments, New Accidents and Calls for Safety