By Dan Gunderson, Mar 29, 2015 at 6:37 p.m.
Oil containers sat at a train depot outside Williston, North Dakota. Andrew Burton | Getty Images 2013
MOORHEAD, Minn. — North Dakota environmentalists want oil companies to reduce volatile gasses in Bakken crude. Regulators, however, say they’re taking a different tack that’s cheaper for the industry and still improves safety.
The gasses remain a flashpoint for producers, environmental and safety groups concerned about transporting the highly flammable Bakken crude. Oil train shipments from the Bakken have skyrocketed in recent years, heightening the worries.
Environmental groups have been pushing the state to require that producers install equipment to stabilize the crude using a process that heats the oil to a higher temperature to release more gasses.
North Dakota officials, however, say the more stringent heating requirement would cost oil companies as much as $2 per barrel.
Instead, state inspectors starting April 1 will check oil at well sites to make sure the vapor pressure runs no greater than 13.7 pounds per square inch of Reid Vapor Pressure, the measurement standard of volatile gases in crude oil. Oil involved in a recent West Virginia derailment and explosion had a vapor pressure slightly higher, 13.9 psi.
The North Dakota standard is tougher than the 14.7 psi federal standard for crude oil, although it’s still more volatile than gasoline sold in Minnesota in the summer, which has a maximum vapor pressure of 9.
Regulators say their method will maintain safety but cost an estimated 10 cents a barrel, compared to the $2 per barrel for the stabilization gas removal process. Companies found violating the new regulation can be fined $12,500 per day.
The industry disputes that Bakken crude is more volatile, but says most North Dakota crude meets the new standard already.
“I think a lot of people have wondered, well, is this going to cure the problem. And our answer is that by itself, it is not the cure,” said Lynn Helms, director of North Dakota’s Department of Mineral Resources.
The new, lower vapor standard is a step in the right direction but safer rail cars are also a critical part of the solution, Helms added. The federal government is considering new rules for safer tank cars that might include thicker steel shells and larger pressure relief valves.
“If you combine our lower vapor pressure standard with the these high capacity relief valves we should be able to get away from these boiling liquid explosive vapor incidents which create the large explosions if and when we have a derailment,” Helms added.
Larger relief valves could allow rapidly expanding gases to escape, preventing rail tank cars from exploding. But critics point out those volatile gases could still catch fire. A newer tank car with improved safety features, the CPC 1232, has been involved in at least two recent oil train derailment and explosion incidents.
Environmentalists argue North Dakota could make the oil much safer.
“The bottom line profitability of the oil industry is trumping all the rest of us, our safety,” said Don Morrison with the North Dakota environmental group Dakota Resource Council.
Much of the light crude oil in Texas is stabilized before it’s shipped, he added. “To stabilize the oil so it is safer like they do in Texas, oil companies are going to have to spend some money. That is true. But isn’t that the cost of doing business?”
The North Dakota Petroleum Council, which represents the oil industry, did not respond to an interview request.
In December 2013, the potential for disaster became very real after train cars of Bakken oil derailed, caught fire and exploded outside Casselton, N.D., near the Minnesota state line. Derailments and fires involving Bakken crude since then have heightened the worry.
Fred Millar, a Washington-based lobbyist and consultant on hazardous materials transportation, contends the new North Dakota standards would not have changed the outcome of a deadly 2013 oil train explosion in Lac Megantic, Quebec in Canada.
Train cars of Bakken crude involved in the Lac Megantic explosion and fire had a vapor pressure of about 9 psi, according to Canadian investigators.
A search of public records and news reports identified 14 derailments involving crude oil trains in the past two years in North America. Fire was involved in nine of the accidents.
New regulations are unlikely to stop crude oil train accidents, Millar said.
“Anybody who’s kind of hoping that somehow there’s going to be this magic bullet or some new set of federal regulations that’s going to make this situation safe,” he said, “I have bridge in Brooklyn I’d like to sell you.”
Repost from McClatchy News [Editor: Thank you to co-sponsors of Sen. Cantwell’s bill: Senators Patty Murray of Washington, Tammy Baldwin of Wisconsin and Dianne Feinstein of California, all Democrats. See also: the Cantwell press release (including a video), and the text of the legislation. – RS]
‘Get them off rails now,’ Sen. Cantwell says of some oil tank cars
By Curtis Tate, March 25, 2015
A DOT-111A tank car rolls past the Amtrak platform at Newark, Del., on July 28, 2013. CURTIS TATE — MCT
WASHINGTON — Sen. Maria Cantwell, D-Wash., introduced legislation on Wednesday that would immediately ban the least sturdy tank cars from carrying crude oil after a series of recent fiery train derailments.
The bill also would require the U.S. Department of Transportation to regulate the volatility of crude oil transported by rail, particularly oil extracted from shale formations in North Dakota’s Bakken region.
Cantwell’s bill follows four recent derailments in West Virginia, Illinois and Ontario that have drawn new scrutiny to the large volumes of oil moving by rail across North America.
The White House Office of Management and Budget is reviewing new regulations intended to address the safety concerns, but Cantwell told reporters Wednesday that the changes couldn’t wait.
“We know that we need to move on this legislation now,” she said. “Derailments keep happening, and we need to take responsibility to ensure that our communities are safer.”
Sens. Patty Murray of Washington, Tammy Baldwin of Wisconsin and Dianne Feinstein of California, all Democrats, are co-sponsoring Cantwell’s bill.
In addition to addressing tank cars and volatility, the legislation also would increase penalties for rail and energy companies that don’t meet federal safety requirements.
The bill would authorize funding to train emergency responders and require railroads to provide more information about oil shipments to state and local emergency officials. It also would require railroads to have comprehensive oil spill response plans.
The measure aims to remove from crude oil service the kinds of tank cars that have proved vulnerable to punctures and fire exposure in a series of derailments over the past two years.
Those include the older DOT-111 cars involved in a July 2013 derailment in Quebec that killed 47 people, as well as newer, industry-designed CPC-1232 cars involved in the most recent four derailments.
All lack thermal insulation and outer jackets to better protect the cars in derailments, and Cantwell’s bill would require tank cars carrying oil have those features.
“There are a bunch of tank cars that are unacceptable now,” she said. “So we’re saying get them off the rails, now.”
Cantwell noted that the rail industry asked the Transportation Department for an improved tank car design four years ago and that her bill would help give the industry some certainty.
“I’m willing to tell them right now: Here’s the standard that I think should be set,” she said.
Repost from PRI’s Living On Earth, Environmental News Magazine [Editor: An important interview. See full transcript below and good links below the transcript. Click here for audio. – RS]
Oil Train Safety Off Track
Steve Curwood, Air Date: Week of March 20, 2015
Five oil train derailments in five weeks–some with dangerous fiery consequences. (Photo: Wikimedia Commons)
In the past five weeks, there have been 5 oil train derailments resulting in large fireballs, and more oil was spilled in 2014 than in the last 38 years combined. Steve Kretzmann, Director and Founder of Oil Change International, and Sarah Feinberg, Acting Administrator of the Federal Railroad Administration, discuss rail safety with host Steve Curwood and offer different solutions to this multifaceted problem.
Transcript
CURWOOD: From the Jennifer and Ted Stanley Studios in Boston and PRI, this is Living on Earth. I’m Steve Curwood. At 12 million barrels a day, the US is the world’s leading oil producer, with much of the boost due to fracking technology. With pipelines at capacity the boom has led a 4,000 percent increase in the volume of crude oil that travels by rail, and that brought more accidents and more oil spills in 2014 than over the previous 38 years. Just these past five weeks brought five more derailments, with huge fires and polluted waterways, and some critics say new rail safety rules on the drawing boards won’t go far enough to protect the public or the environment. Steve Kretzmann is Executive Director and Founder of Oil Change International. Welcome to Living on Earth, Steve.
KRETZMANN: Thanks so much for having me here, Steve. It’s great to be back.
CURWOOD: Now, what we are seeing is a lot of crashes and explosions. What’s happening?
KRETZMANN: So we’re seeing, unfortunately, a very visible result of the ‘all of above’ energy policy, playing out with great risks to our communities around North America on a whole. The Bakken oil is very light oil, and it’s very explosive, it turns out, and people have known this, but it hasn’t really stopped them from shipping it via rail. And it’s also worth noting that because that oil is light oil, that’s mixed in with tar sands to form diluted bitumen, which is usually the way tar sands get to market, we’re also seeing tar sands trains now explode, and so they’re just trying to get as much out as fast as they can and maximize their profit. And as we know, the oil market is flooded with crude now and effectively we’re subsidizing that with our safety in our communities and our lives.
CURWOOD: Now, in Texas where there’s a fair amount of fracking for oil, there are machines that remove the most volatile portion, the most explosive part of fracked oil before it is shipped, but in North Dakota it is not. Why this discrepancy? Why don’t they make this safety precaution in North Dakota?
KRETZMANN: Well, it’s about profit, it’s about investment and infrastructure by the industry, so the production in Texas is very close to markets and so when they invest in the infrastructure to remove the lighter petroleum product – natural gas among other things – they can then sell that oil because they can put in the pipelines. On the other hand, North Dakota does not have those gas pipelines and the infrastructure is not there to capture it and so their options are burn it or try to force it into the tank car, which is what they’re doing. There are new regulations that are supposed to take effect from North Dakota that will reduce the amount that they can squeeze in there on a regular basis, but it’s not clear that the regulation is in line with what will actually create a safe car. It’s just slightly less than they’ve been able to get away with.
Older DOT 111 cars usually do not fair well in crashes, even at low speeds. (Photo: Robert Taylor; Flickr Wikimedia Commons CC BY 2.0)
CURWOOD: Talk to me about the new tanker safety rules and how effective they might be in preventing the kind of explosions we’ve seen on oil train derailments.
KRETZMANN: So it’s not clear what the new rules are going to be. There are the North Dakota rules which are a slight reduction in vapor pressure, and then there are the federal rules, which are under consideration by the Obama administration, and we’re going to see another draft of those supposedly within the next month. But there are very different options that they can take. They could build thicker-walled oiled trains, they could require that, but the oil industry doesn’t like that because it costs them more money. They could install electronically controlled pneumatic brakes on the railcars, but the rail industry doesn’t like that because it costs them too much money. One of the most effective things they could do is introduce a very serious speed limit. The DOT 111s, the old cars, still make up the majority of the crude by rail fleet; they’ve been shown to explode at seven miles an hour. The 1232s, which are the newer supposedly safer cars, but are the ones that have been involved in each one of these accidents recently, have been shown to explode at 15 miles an hour. So, we say you should put in serious restrictions here: all new cars, speed limits at 15 or below, particularly in populated areas. You know the industry gets very upset about that and says, “oh my God, that would mean we would have to stop production”. And you know, the point is “yes”, maybe actually reducing some production in the name of public safety is worth it here.
Steve Kretzmann is the Founder and Executive Director of Oil Change International. (Photo: courtesy of Mr. Kretzmann)
CURWOOD: So you mentioned that communities are at risk from these crude oil trains. What ones come to mind for you?
KRETZMANN: So when you look at the map of where crude oil trains are going around the United States, it’s very clear you start looking at the routes: Minneapolis, Chicago, St. Louis, New York, Philadelphia, Cleveland, Detroit. All these cities have crude by rail trains, these bomb trains running right through them. 25 million Americans live within the blast zone here and it’s sadly not a question of if but when one of these explosions is going to result in a tremendous tragedy. We have the opportunity to slow this down and put a moratorium in place before this happens and we should take it.
CURWOOD: That was Steve Kretzmann of Oil Change International. Well, a moratorium on oil transport by rail is unlikely, and the Obama Administration has yet to issue new rules, even after two years of work. So in the face of the recent accidents it’s issued some emergency rules and here to explain is Sarah Feinberg the Acting Administrator for the Federal Railroad Administration. Welcome to the program.
FEINBERG: Thank you for having me.
CURWOOD: So what do you have in place now in terms of emergency regulations then, emergency rules?
FEINBERG: Well, we have a lot. We have a requirement of railroads to share information about the product that’s being transported with emergency responders in each state. We have an emergency order that’s in place regarding testing and making sure that the right tank car and right packaging is being used for each product. Over the course of a year and a half that I’ve worked on this issue, we were enforcing against violations for not testing the product properly, not packing it in the right container, not handling it the right way, not sharing information about it. I’m not saying things are in a good place now, they certainly aren’t. We’ve got a long way to go, but when I think back to where we were a year and a half ago, it’s amazing to me we’re actually having a conversation about testing then.
A DOT-111 tank car with an insulating jacket and external heating coils can hold 20,000 gallons of crude. (Photo: National Transportation Safety Board; Wikimedia Commons)
CURWOOD: Now, not long ago there was a dramatic explosive derailment in West Virginia that involved the new kinds of cars, the supposedly safer cars, and some folks are saying that apparently having those cars aren’t safe enough. What you say?
FEINBERG: Well, it’s really important to understand the different kinds of cars that are out there. The one we hear about a lot is the DOT 111. That is the older tank car; I think everyone agrees across the board that tank car is certainly outdated. It’s not safe enough to hold this product or others. Industry on its own a few years ago came up with their own version of a tank car that’s called the 1232. While it is a better tank car, and it’s a newer version of a tank car, one person on my team once referred to the 1232 as the .111 with a five-mile per hour bumper on it. So it’s a Pinto with a better bumper instead of just a Pinto. The other most important thing to think about is that all 1232s are not the same. They didn’t have all the safety components that they could have had. They didn’t have a jacket; they didn’t have a thermal shield. These are important components to keep a tank car from basically experiencing the thermal events that create fireballs.
CURWOOD: No matter what kind of car it is, they’re going off the rails. Some folks say that the trains are just simply traveling too fast.
FEINBERG: Look, I mean speed should be a factor, but the reality of is that in all of these derailments, they’ve been very low speed. In fact, the agreements that we have in place with the railroads limit speed at 40 miles an hour. We’re now in a position where we’ve got railroads functioning below the maximum speed and we are still running into problems. There is not a tank car at this moment or even the new version of the tank car we’ve proposed that will survive a derailment above, say, 16 or 18 miles an hour. So that’s one of the reasons why this issue is so complicated. There is literally not a silver bullet. It’s not speed, it’s not a particular tank car, its not the way the train is operated. It’s all of the above and it needs to include, frankly, the product itself that’s being placed in the transport, the product that’s leaving the Bakken and heading to the refinery.
CURWOOD: How safe is it to allow such volatile fuel to be transported on rails?
Sarah Feinberg is the Acting Administrator of the Federal Railroad Administration. (Photo: FRA)
FEINBERG: I mean, if I have to be honest, I would prefer that none of this stuff be traveling by rail. I worry a lot about not just the folks who are working on the train and the passengers on the Amtrak that the train is going by, but I worry a lot about the people living in the towns and working in the towns that these trains are going through. Now, we have some routing protocols in place. There is a whole software system that the railroads use when they are trying to determine the right route for a substance like this, so it looks at things like city size, it looks at possible defects on rail, it looks at weather, it looks at speed, it looks at traffic, it looks at all of those factors and it basically spits out the best route for you to take.
CURWOOD: Industry a few days ago went over to the Office of Management and Budget, the folks who review the rule-making there inside of the OMB, and made a lot of complaints about the proposal to have this updated form of braking, they say it won’t have more significant safety benefits, it won’t have much in the way of business benefits and be extremely costly. Sounds like industry is pushing back against getting this stuff under control. Your take?
FEINBERG: Yeah, sure. And I expect that. Look, OMB meets with industry, yet the FRA is required to meet with all interested parties as well. So, as many meetings as I did with industry, I think we all did with the environmental community, small-town mayors, governors and interested members of Congress. So there are a whole lot of folks with a dog in this fight and they all want to talk to the regulator and they all want to talk to the Office of Management and Budget to affect the outcome of the rule. I think at the end of the day it’s OMB’s job and it’s FRA’s job to come up with the best possible rule that we can that will actually address the challenge. To be clear, that’s not an easy thing to do right now. It’s a bit amazing at this point you can take a common sense safety measure and watch the amount of time that it can actually take to turn into a regulation, but you know that’s my frustration, that’s our problem and our issue to deal with, and the main thing is we should just be keeping people safe.
CURWOOD: Sarah Feinberg is the Acting Administrator for the Federal Railroad Administration. Thanks so much for taking the time today.
FEINBERG: Thanks for having me.
CURWOOD: We asked the Association of American Railroads for comment on the proposed new regulations.
Spokesman Ed Greenberg’s reply is posted in full at our website, LOE.org.
It reads, in part: “America’s rail industry believes final regulations on new tank car standards by the federal government would provide certainty for the freight rail industry and shippers and chart a new course in the safe movement of crude oil by rail.”
Coming up…the power of labor allied with environmental activists. Stay tuned to Living on Earth.
The Association of American Railroads comment:
“The safety of the nation’s 140,000-mile system is a priority of every railroad that moves the country’s economy and the freight rail industry shares the public’s concern over recent high-profile incidents involving crude oil. This is a complex issue and a shared responsibility with freight railroads and oil shippers, which are responsible for properly classifying tank car contents, working together at further advancing the safe movement of this product.
The fact is, safety is built into every aspect of the freight rail industry, it is embedded through-out train operations and a 24/7 focus for thousands of men & women railroaders. Billions of private dollars are spent on maintaining and modernizing the freight rail system in this country. Since 1980, $575 billion has been spent on safety enhancing rail infrastructure and equipment with another $29 billion, or $80 million a day, planned for 2015.
Railroads have done top-to-bottom operational reviews and voluntarily took a number of steps to further improve the safety of moving crude oil by rail. Actions have included implementing lower speeds, increasing track inspections and track-side safety technology, as well as stepping up outreach and training for first responders in communities along America’s rail network.
Federal statistics show rail safety has dramatically improved over the last several decades with 2014 being the safest year in the history of the rail industry. More than 2 million trains move across our country every year hauling everything Americans want in their personal and business lives with 99.995 percent of cars containing crude oil arriving safely. That said, the freight rail industry recognizes more has to be done to make rail transportation even safer.
Freight railroads do not own or manufacture the tank cars carrying crude oil. Still, the freight rail system has long advocated for tougher federal tank car rules and believe that every tank car moving crude oil today should be phased out or built to a higher standard. We support an aggressive tank car retrofit or replacement program.
America’s rail industry believes final regulations on new tank car standards by the federal government would provide certainty for the freight rail industry and shippers and chart a new course in the safe movement of crude oil by rail.”
Filed in the U.S. District Court for the Southern District of Texas, Houston Division, AFPM sued BNSF “for violating its common carrier obligation by imposing a financial penalty” for those carrying oil obtained via hydraulic fracturing (“fracking”) in North Dakota’s Bakken Shale basin and other hazardous petroleum products in explosion-prone DOT-111 rail cars.
The Warren Buffett-owned BNSF did so, argues AFPM, illegally and without the authority of the federal government.
“This $1,000 surcharge on certain PHMSA-authorized rail cars breaches BNSF’s common carrier duty to ship hazardous materials under the auspices of PHMSA’s comprehensive regime governing hazardous materials transportation,” wrote AFPM‘s legal team, featuring a crew of Hogan Lovells attorneys. “Allowing railroads to penalize companies that ship crude oil in federally-authorized rail cars would circumvent PHMSA’s statutory and regulatory process for setting rail car standards for hazardous materials shipments.”
Upon a quick glance, it seems like a fairly straight-forward case of federal law and an intriguing example of an intra-industry dispute. But as recent history has proven, the devil is in the details.
BNSF Surcharge Not Unique
Though unmentioned in AFPM‘s lawsuit, BNSF is not the only oil-by-rail “bomb trains” company promulgating a surcharge.
“CP Rail will add a $325 ‘general service tank car safety surcharge’ on each car of crude that is shipped in any container other than the CPC 1232 model, effective March 14, it said in a notice issued to customers,” Reuters reported. “The new tiered pricing scheme comes the same week that Canadian National Railway Co also confirmed it was increasing rates for the older variety of DOT-111 tank cars.”
In its lawsuit, AFPM disapprovingly cited minutes from a March 19 meeting held between BNSF higher-ups and U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) higher-ups in which a BNSF told PHMSA that “there needs to be [a] disincentive to use DOT 111.”
Yet in the Reuters article, CP Rail spokesman Ed Greenberg stated that his company had the same goal as BNSF: to “encourage shippers to work towards an upgraded tank car standard for crude by rail shipments.”
“While AFPM supports appropriate and effective mitigation, several of PHMSA’s proposed measures fail to take meaningful steps toward preventing derailments, risk significantly reducing crude rail capacity, and cost billions of dollars,” wrote AFPM. “AFPM respectfully submits that any effort to enhance rail safety must begin with addressing the primary root causes of derailments and other accidents: (1) track integrity and (2) human factors.”
Beyond advocating against oil-by-rail regulations, AFPM also funded a May 2014 study concluding that Bakken crude oil is no more chemically volatile than any other oil.
“Bakken crude oil was found to be well within the limits for what is acceptable for transportation as a flammable liquid,” the report concludes. “This survey shows that Bakken crude oil does not pose risks that are significantly different than other crude oils and other flammable liquids authorized for transportation as flammable liquids.”
“BNSF continues to review the complaint…challenging [its] recent implementation of rate discounts for crude shippers that load their product in rail cars with improved safety characteristics,” stated the company.
“This rate structure is also consistent with BNSF‘s ongoing efforts to ensure the safe transport of crude on our network, including voluntary adoption of enhanced operating practices around crude oil shipments and requesting the federal government to make newer, safer tank cars the new standard for crude-by-rail shipments, replacing the older DOT-111 and non-modified CPC-1232 cars.”
Purposeful Distraction?
So, what gives? Why a lawsuit against BNSF by AFPM and not against CN Rail nor CP Rail? No clear answers exist and AFPM did not respond to a request for comment sent by DeSmogBlog.
Despite the murkiness at play, some answers do exist.
Firstly, CPC-1232 tanks cars — the centerpiece of the lawsuit — have proven no “safer” than DOT-111 tank cars to begin with. And secondly, the lobbying and advocacy track records of both BNSF and AFPM demonstrate they both prefer the status quo over robust regulations, which would hurt their corporate bottom lines.
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