FACTBOX-California crude sources and oil-by-rail projects
Mon Jul 21, 2014
HOUSTON, July 21 (Reuters) – California refiners remain far behind peers elsewhere in the country in replacing expensive imports with cheaper North American crudes from a new production boom.
No major crude pipelines cross the Rocky Mountains, leaving the isolated region dependent on rail to tap the burgeoning bounty in Texas, North Dakota and other growing oilfields.
More than half of the 1.7 million barrels of crude processed by California refineries each day is imported, largely from Saudi Arabia, Ecuador, Iraq and Colombia. The rest comes from California and Alaska, where output is declining.
Several refiners and logistics or pipeline companies are trying to tap U.S. and Canadian crude via rail, but California’s tough regulatory environment and growing opposition in light of fiery crude train crashes elsewhere could halt current projects and stop new ones from starting up.
Tesoro Corp and Savage Companies are proposing a 360,000 barrels per day railport at the Port of Vancouver in Washington that, if approved, could potentially replace more than 40 percent of California’s imported crude. Once railed to Vancouver, crude would be loaded onto barges or ships bound for West Coast refineries.
Here is a rundown of California’s crude slate and existing and pending oil-by-rail projects:
CALIFORNIA CRUDE
California’s 1.7 million barrels per day (bpd) of crude processed in 2013 came from these three main sources:
* Imports: 875,564 bpd, 51 percent of the total
* California, 631,441 bpd, 37 percent
* Alaska, 201,720 bpd, 12 percent
The non-California supply arrives via ships or barges except negligible oil-by-rail shipments, which reached 15,715 bpd in the first quarter of 2014.
That is less than 2 percent of the overall 873,967 bpd that originated on top U.S. railroads throughout the United States in the same period.
By comparison, in 2003 a little more than one-third of the 1.8 million bpd of crude processed in California came from imports:
* Imports, 636,923 bpd, 34 percent
* California, 792,920 bpd, 42.5 percent
* Alaska, 438,805 bpd, 23.5 percent
Source: California Energy Commission
(Reporting By Kristen Hays, editing by Peter Henderson)
Repost from KQED Science [Editor: Significant quotes: 1) by Alexia Rettalack of California’s Office of Spill Prevention and Response (OSPR) – “Spills happen. When product moves, things happen.” 2) by Paul King, deputy directory for rail safety at the California Public Utilities Commission – “My view is it’s pretty undeniably bringing in extra risks to the state. These trains explode. If that were to happen in a town, there’s no telling the damage.” – RS]
California Has Little Say Over Oil Train Safety
Molly Samuel, KQED Science | July 21, 2014
A BNSF train with tank cars crosses a trestle in the Feather River Canyon in Northern California. (Courtesy of Jake Miille)
The number of trains carrying crude oil across California is increasing rapidly, and two official reports say the state is not ready. Regulators are preparing, with funds for disaster response and more track inspectors, but they’re limited in how much they can do to make rail transport safer.
“My view is it’s pretty undeniably bringing in extra risks to the state,” said Paul King, deputy directory for rail safety at the California Public Utilities Commission (CPUC).
“These trains explode,” King said. “If that were to happen in a town, there’s no telling the damage. And of course we know what happened in little Lac-Mégantic.” That’s the town in Quebec where a train carrying crude from North Dakota’s Bakken formation derailed last July. The explosion killed 47 people.
Bakken crude is volatile. In the past year, trains transporting crude from the Bakken have also exploded in North Dakota, Virginia and Alabama.
Trains carrying Bakken crude traverse California, too, bringing the oil to refineries here. And while the CPUC regulates rail in California, the state can’t actually do much when it comes telling the railroads how they can operate. Almost all of those rules are up to the federal government.
‘Our Hands in California Are Tied’
The state can’t set speed limits on crude oil trains. It can’t tell railroads to choose less hazardous routes. It can’t tell oil companies not to bring trains carrying the volatile crude through cities. It can’t tell oil companies to ship that crude in stronger tank cars. It can’t require upgraded braking systems.
Neither can local governments, though the cities of Davis, Richmond and Berkeley have all passed resolutions expressing their opposition to the transport of crude oil by rail.
“I almost feel like our hands in California are tied, yet all these trains are going through our communities,” State Senator Hannah-Beth Jackson, a democrat from Santa Barbara, said at a hearing last month.
Trains carried nearly 6.3 million barrels of oil into California in 2013. That’s more than five times more than in 2012. According to the California Energy Commission, by 2016 that number could balloon to more than 100 million barrels.
That’s because there’s an oil boom in the middle part of the continent, and to get that crude from Alberta and North Dakota to California, oil companies have to use trains.
Firefighters douse blazes in Lac-Megantic on July 6, 2013. (François Laplante-Delagrave/AFP/Getty Images)
Steps Towards Safer Shipping
There are ways to make the trains safer.
Most of the tank cars used to transport crude oil, including the volatile Bakken crude, are old, and can’t protect against explosions. After the disaster in Lac-Mégantic, Canada required that the most dangerous of the cars — the same tank cars that carry as much as 82 percent of crude oil in the U.S. — be removed from service, and that the rest be retrofitted.
The U.S. is considering stricter tank car standards. Last week, the advocacy group Earthjustice sent a letter to the U.S. Department of Transportation, urging the agency to move faster by issuing an emergency order immediately banning the use of the unsafe cars.
But California can’t require any of this. The CPUC intends to urge the DOT to “move expeditiously” to update its tank car regulations. That, and other recommendations, are laid out in a recent report on crude-by-rail safety in the state. The state wants the feds to require that there be newer braking technology on oil trains and a GPS-based system that prevents accidents on oil train routes. According to King, the CPUC will submit those recommendations to the Federal Railroad Administration soon.
The railroads have already adopted some voluntary safety measures, including lower speed limits and increased track inspections. And Burlington Northern Santa Fe Railway, the company that is currently transporting large amounts of Bakken crude in California, is asking railcar manufacturers to submit bids to build 5,000 safer cars. (The railroads typically don’t own the cars used to ship material; the oil companies themselves either own or lease them.)
The CPUC has done one of the main things it can: hire more railroad safety inspectors. The CPUC keeps a list of the most hazardous sections of track, and according to a recent report, the most frequent cause of derailments at those sites are track problems. The new state budget adds seven positions, bringing the CPUC’s inspection staff to 38. CPUC staff checks all the tracks in California once a year and, going forward, will check the tracks on Bakken oil train routes twice a year
A Past Disaster
California once tried to introduce stricter railroad regulations.
In July, 1991, a train derailed in Northern California at a bend in the track where it crosses the Upper Sacramento River, near the town of Dunsmuir. It spilled 19,000 gallons of a pesticide called metam sodium into the river.
“It killed everything down to the bacteria,” said Mark Stopher, who was hired by the California Department of Fish and Wildlife to assess the damage to the river.
The poison killed more than a million fish, and every insect and plant in the river for 40 miles. “Nobody’s ever seen anything like that before,” he said. In video from the time, you can see fish struggling to escape the river and get into tributaries. Stopher said they all died.
“It was kind of a blow to the heart to lose the river,” said Phil Dietrich, executive director of a conservation group called River Exchange.
The Upper Sacramento had been a popular fishing destination. So when the fish were gone, the tourists, and their money, disappeared too.
But it was a pulse of poison; metam sodium doesn’t linger. A few years later, the fish were back. The tourists are back, too. It could have been worse, if what spilled had been a substance that lasts in the environment for a longer time. Oil, for instance.
After the accident, the CPUC tried to require stronger track at Cantara Loop, to keep it from happening again.
“We were trying to adopt regulations where there were none,” said King. But they couldn’t. The railroad sued the CPUC, and eventually the court sided with the railroad, reinforcing the Federal Railroad Administration’s jurisdiction. There is a large rail in place on the bridge now, to help keep trains from derailing into the river. According to the CPUC, there have been four derailments in the area since 2009.
“Our role is limited,” King said. “Our role is to ensure that the regulations that the federal government has in place are followed.”
Beefing Up Clean-Up
Even if the the state can’t do all it wants to keep an accident from happening, it can prepare to respond to one.
In June, dozens of fire fighters, public health experts and Red Cross volunteers gathered near Cantara Loop to run a drill. The scenario was that an oil train had collided with an illegal marijuana grower’s truck at the site of the ’91 spill. The truck wrecked, and the train derailed and spilled oil into the river.
Firefighters pulled the casualties (volunteers marked with paint) away from the scene, a helicopter brought tools to treat people who’d been doused in dangerous chemicals and a team deployed a drone to get a view of the (largely imaginary) disaster scene from above.
“We want to make sure California’s prepared to respond,” said Alexia Rettalack of California’s Office of Spill Prevention and Response (OSPR). “Spills happen. When product moves, things happen.”
OSPR got more money in this year’s budget, so that it can prepare for inland oil spills. Until now, the agency focused only on marine accidents. The state Office of Emergency Services is also looking for ways to better prepare emergency responders, many of whom are volunteers, for an oil train explosion. And state lawmakers are considering a couple of crude-by-rail bills that would improve emergency responses.
Dietrich emphasizes that what happened in Dunsmuir in 1991 was a rare event, and yet, the memory lingers.
“It comes down to we care about our river and about our towns,” he said. “And we hope that the agencies and the railroad are on top of it.”
California Groups Tell EPA: Set Stronger New Standards for Oil Refinery Air Pollution
Focus on need for the EPA to do more to protect communities’ health
July 16, 2014
Los Angeles, CA — California environmental and community groups—including families living near oil refineries—today provided powerful testimony about why the U.S. Environmental Protection Agency must strengthen protections from hazardous air pollution.The statements were made during a day-long public hearing in Wilmington, Calif., which the EPA held as part of its 60-day public comment period on proposed standards that would strengthen emissions and monitoring requirements for the country’s nearly 150 oil refineries.In advance of the hearing, Jane Williams, director of California Communities Against Toxics, said:
“The EPA’s proposal is an improvement over the status quo. However, it does not go far enough to reduce the harmful, toxic air that our children are exposed to. More must be done to reduce hazardous pollution spewed by the nation’s oil refineries to prevent cancer, breathing problems and other illnesses in our children.”
Although the proposed standards—to be finalized in April 2015—reduce hazardous air pollution by 5,600 tons each year and reduce cancer risk for millions of Americans, community leaders who have been working for decades for stronger protection say the standards fall short of the Clean Air Act mandate that all sources must follow at least, the average, emission control achieved by the cleanest refineries.
The proposed standards that were published in the federal register last month resulted from a consent decree resolving a lawsuit filed by Earthjustice and the Environmental Integrity Project on behalf of environmental groups in California, Louisiana, and Texas that argued that EPA missed its deadline under the Clean Air Act to review and update toxic air standards for oil refineries by more than a decade.
The proposed standards, include a fence line monitoring requirement for the first time, which would require refineries to measure the toxic air contaminant benzene at the property line as it goes into the local community’s air. In addition, if benzene exceeds the new action level EPA proposes to establish, the federal agency would require a plan for corrective action.
In addition, the proposed standards would require tighter controls on emissions from storage tanks and other parts of refineries that are major contributors to toxic air pollution (such as delayed coker units) along with controls and monitoring requirements on flaring or the burning of waste gas, which is, too often, used routinely and which creates harmful new pollution.
The proposed standards also finally remove unlawful loopholes that previously allowed refineries to escape scot-free when they violated the air standards.
For EPA’s new standards to provide much-needed protection for communities on the ground, environmental groups are calling for stronger fence line monitoring requirements that would mandate the use of the best current technology to give neighborhoods a real-time, continuous measure of pollution, not just a snapshot or long-term average that masks peak exposure levels. The standards also must require accessible public reporting and enforceable corrective action so refineries will quickly fix violations. In addition, groups want to see a hard limit on flaring to ban its routine and unnecessary use and to assure refineries minimize flaring in all other circumstances, as well as tighter controls on emissions from other parts of refineries.
Cynthia Babich, of Del Amo Action Committee said she is most focused on the real world health impacts of refineries’ pollution when considering this proposal. “The EPA must do a health evaluation using the most current scientific methods, instead of ignoring dangerous health risks our communities face,” said Babich.
“People who live near refineries are often surrounded by multiple sources of contaminants from other polluters besides refineries, like chemical plants. And in view of this and the greater risk to our most vulnerable children, EPA should find the current, high level of health risk to be unacceptable and set stronger emission limits,” she said.
Jesse Marquez, of Coalition For A Safe Environment, said his organization supports EPA’s proposal to make flares more efficient when they are used, and also calls on the EPA to limit flared emissions by setting a hard cap on flaring that will ban its everyday use.
“The oil industry claims emissions have been decreasing for decades but we found that flared emissions at the four refineries in the Wilmington area increased every year between 2000 and 2011,” Marquez said. “We must have stricter standards to end all unnecessary flaring and improve our air quality.”
Although the oil industry is objecting to the new proposed standards, community groups’ testimony illustrated today how important it is for EPA to reduce toxic air pollution and decrease the unacceptable extra health threats millions of Americans currently face just because they live near refineries. EPA predicts its current proposal will take about 5,600 tons each year of hazardous chemicals, associated with leukemia and other devastating forms of cancer, out of the air.
Lisa Garcia, Earthjustice’s Vice President of health, said: “It is imperative that we fight industry’s unfounded attempts to weaken EPA’s attempt to strengthen health protection, and, instead, do all we can to protect everyone—especially fence line communities and those that are overburdened—from the unacceptable harm caused by oil refineries’ pollution. We must stand behind EPA’s efforts to set strong new hazardous air pollution standards, just as the Clean Air Act requires it to do.”
Eric Schaeffer, executive director of the Environmental Integrity Project said: “EPA’s analysis shows that the proposed emission controls are worthwhile and will have negligible impact on the bottom-line of these companies, many of which report multi-billion dollar profits every year. The communities affected by refinery pollution cannot continue to pay for this pollution in the form of medical bills and missed school and work days, which add up to tens of millions of dollars every year.”
BILLINGS, Mont. (AP) — U.S. transportation officials said Wednesday that details about volatile oil train shipments are not sensitive security information, after railroads sought to keep the material from the public following a string of fiery accidents.
The U.S. Department of Transportation has ordered railroads to give state officials specifics on oil-train routes and volumes so emergency responders can better prepare for accidents.
Railroads have convinced some states to sign agreements restricting the information’s release for business and security reasons.
But the Federal Railroad Administration determined the information is not sensitive information that must be withheld from the public to protect security, said Kevin Thompson, the agency’s associate administrator.
Thompson added that railroads could have appropriate claims that the information should be kept confidential for business reasons, but said states and railroads would have to work that out.
Montana officials said they intend to publicly release the oil-train information next week.
The move is mandated under the state’s open records law and will help protect public safety by raising community awareness, said Andrew Huff, chief legal counsel for Gov. Steve Bullock.
“Part of the whole reason the federal government ordered that this information be given to states is to protect the communities through which these trains roll,” Huff told The Associated Press. “If there’s not some federal pre-emption or specific regulation or statute that prevents release of this information, then under our records laws we have to release it.”
Washington state officials also have said the oil-train details should be made public under state law. Last week, they gave railroads 10 days to seek a court injunction challenging the release of the information.
An oil-train derailment and explosion in Quebec last July killed 47 people. Subsequent derailments and fires in Alabama, North Dakota, Virginia and New Brunswick have drawn criticism from lawmakers in Congress that transportation officials have not done enough to safeguard against further explosions.
In response to the accidents, Transportation Secretary Anthony Foxx said in last month’s order that railroads must provide the details on routing and oil-train volumes to states. The order covered trains hauling a million gallons of oil or more from the Bakken region of North Dakota, Montana and parts of Canada.
The Bakken’s light, sweet crude is more volatile than many other types of oil. It’s been involved in most of the major accidents as the crude-by-rail industry rapidly expanded during the past several years.
Some states have agreed to requests from BNSF Railway, CSX and Union Pacific to keep the information confidential after the railroads cited security concerns. Those include California, New Jersey, Virginia, Minnesota and Colorado.
Officials in New York, North Dakota and Wisconsin said they still were weighing whether restrictions on the information would violate state open-records laws.
State officials who questioned the confidentiality agreements sought by the railroads have said the notifications about oil trains were not specific enough to pose a security risk.
BNSF — the main carrier of crude oil in many western states — was notified late Tuesday of Montana’s intentions. A representative of the Texas-based company had said in a June 13 letter that BNSF would consider legal action if Montana moved to release the details on oil shipments.
“We must be cognizant that there is a real potential for the criminal misuse of this data in a way that could cause harm to your community or other communities along the rail route,” wrote Patrick Brady, BNSF’s director of hazardous materials, in a letter to a senior official at the Montana Department of Environmental Quality.
Company spokesman Matt Jones said Wednesday that at this time BNSF has no plans to ask a court to intervene.
While it’s important for emergency planners to have the information, Jones added, BNSF will “continue to urge discretion in the wider distribution of specific details.”
A second railroad, Montana Rail Link, submitted notifications earlier this month revealing that its tracks were carrying three oil trains a week along a route from Huntley, Montana, to Sandpoint, Idaho. The railroad said the trains pass through as many as 12 counties across southern and western Montana and through Bonner County in Idaho, according to copies of the documents obtained by the AP.
U.S. crude oil shipments by rail topped a record 110,000 carloads in the first quarter of 2014. That was the highest volume ever moved by rail, spurred by the booming production of shale oil from the Northern Plains and other parts of the country, according to the Association of American Railroads.
You must be logged in to post a comment.