Tag Archives: Crude by Rail

Benicia Herald, Benicia Planning Commission, Crude By Rail, Public permitting, Valero Benicia Refinery, Valero Crude By Rail

Benicia publishes Notice of Availability & Public Hearings on Valero Crude by Rail

By Roger Straw, Editor, Sunday, August 30, 2015

An official notice appeared in the Benicia Herald today regarding the proposed Valero Crude By Rail project.  The newspaper notice details plans to release and recirculate the Revised Draft Environmental Impact Report and to hold hearings on the new report.

The City of Benicia arranged for the Benicia Herald to publish this in its Sunday 8/30/15 edition, but it is not yet available online.  I am providing a scanned version is available here .  (UPDATE: See the City’s  online version here.)

SIGNIFICANT HIGHLIGHTS FROM THE TEXT

  • In response to requests made in comments on the DEIR,  the City is issuing this RDEIR to consider potential Impacts that could occur uprail of Roseville, California (i.e., between a crude oil train’s point of origin and the California State border, and from the border to Roseville)  AND  to supplement the DEIR’s evaluation of the potential consequences of upsets or accidents involving crude oil trains based on new information that has become available since the DEIR was published .  In order to allow the public and interested agencies the opportunity to review this information, the City has elected to recirculate  certain portions  of the DEIR.
  • SUMMARY OF SIGNIFICANT IMPACTS ON THE ENVIRONMENT:  …The environmental analysis conducted to date indicates that  there would be a significant and unavoidable impact associated with air quality and greenhouse gas emissions, hazards and hazardous materials, and biological resources .  The impacts associated with all other environmental issues either would be less than significant or would be reduced to a less-than-significant level with the incorporation of mitigation measures.
  • AVAILABILITY AND PUBLIC REVIEW PERIOD:  … 45-day public review period beginning on Monday, August 31, 2015 and ending at 5:00 p.m. on Thursday, October 15, 2015 .
  • Because the proposed revisions to the DEIR affect only portions of the analysis, the City is recirculating only those affected portions for public review. Pursuant to CEQA Guidelines Section 15088.5(f)(2),  anyone wishing to submit comments on the RDEIR should limit those comments to the revised portions shown In Chapter 2 of the RDEIR  (Revisions to the Draft Environmental Impact Report).
  • PUBLIC HEARINGS:  …  The City of Benicia Planning Commission will hold a formal public hearing to receive comments on the RDEIR on September 29, 2015. In anticipation of the number of speakers, additional Planning Commission meetings to receive comments on the RDEIR are scheduled for September 30, October 1, and October 8, 2015 .  These additional meetings will only be held as necessary to hear public comment.  All meetings will begin at 6:30 p.m. in the City Council Chambers, Benicia City Hall , located at 250 East L Street, Benicia, CA 94510.  Comments on the RDEIR may be provided at the public hearing or may be submitted in writing, no later than 5:00 p.m., on Thursday, October 15, 2015.
  • All written comments should be provided to:

Amy Million, Principal Planner
Community Development Department
250 East L Street, Benicia, CA 94510
amillion@.benicia.ca.us
(707) 747-1637 (fax)
NOTE: The comment period on the DEIR ended on September 15, 2014 and the City Is in receipt of comments previously submitted so  there is no need to resubmit comments previously provided .

Bakken Crude, Crude By Rail, Oil Industry, Oil prices, Oil refineries

Does zero Bakken crude for Irving Oil indicate a trend?

Repost from Railway Age
[Reference:  see the 8/20/15 Wall Street Journal article, Canada’s Largest Refinery Shifts from Bakken Shale Oil to Brent Crudes.  – RS]

Does zero Bakken crude for Irving Oil indicate a trend?

By  William C. Vantuono, Editor-in-Chief, August 28, 2015
Irving Oil Ltd. Saint John, N.B. refinery
Irving Oil Ltd. Saint John, N.B. refinery

Irving Oil Ltd., operator of Canada’s largest crude oil refinery, has stopped importing crude oil sourced from the Bakken shale formation in North Dakota and shipped by rail in favor of cheaper crudes from such producers as OPEC, “reflecting a shift in crude costs affecting East Coast refiners during a global slump in oil prices,” the Wall Street Journal recently reported.

The 320,000-barrel-a-day refinery in Saint John, N.B., one of the biggest by volume in North America, had been receiving 100,000 barrels a day by rail, a high reached two years ago that was only temporarily affected by the Lac Mégantic disaster. (The Montreal, Maine & Atlantic crude oil train that derailed on July 6, 2013, claiming 47 lives, was bound for the refinery). Today, CBR shipments the refinery are zero, a move “that reflects shifting economics in the energy industry even as the price of oil—including Bakken crude—has slumped to six-year lows,” said the WSJ. “About 90% of the crude oil Irving currently buys is shipped by sea from such producers as Saudi Arabia and those in western Africa, with the remainder coming by rail from such western Canadian oil-sands operators as Syncrude Canada Ltd. and Royal Dutch Shell PLC. A year ago, Bakken crude made up about 25% of Irving’s feedstock and in 2013 it supplied nearly one-third of its procurement volume, or about 100,000 barrels a day. ‘The Bakken price has gone up’ relative to other crudes when CBR costs are factored in,’ [an Irving Oil executive] said.”

“A once-yawning gap, between the cost of oil produced in North America and overseas crudes priced at the Brent global benchmark, has narrowed since 2013,” the WSJ noted. “Refiners on North America’s east coast can now import crude shipped by sea for less than the cost of shipping it by rail from shale oil producers in North Dakota and elsewhere in the U.S.”

Production of U.S. shale oil, especially that from the Bakken, led to CBR shipments increasing exponentially due to a lack of pipelines. CBR is more expensive than by shipping by pipeline and even by ship, and fewer refiners are willing to pay a premium for CBR. <p< Whether Irving Oil’s decision to abandon Bakken crude for a single refinery reflects a broader trend that will affect CBR movements remains to be seen. Two other refiners have followed suit, but the situation may not be permanent.

“Refiners PBF Energy Inc. and Phillips 66 both said they increased procurement of overseas crudes at the expense of CBR in the second quarter, though they signaled it is unclear if that will continue throughout the rest of the year,” the WSJ reported. “‘Our ability to source sovereign waterborne crudes was far more economic to the East Coast facilities, and that’s what we did,’ PBF Energy CEO Tom Nimbley said in late July. Phillips 66 CEO and Chairman Greg Garland told investors last month, ‘We actually set [crude-by-rail] cars on the siding. We brought imported crudes in the system.’ But, he added, ‘I’d say given where our expectations are for the third quarter, I’d say cars are coming off the sidings, and we’re going to import less crude.’”

CBR traffic has dropped substantially compared to last year, “reflecting both the worsening economics of CBR and better pipeline access to refineries on the Gulf of Mexico,” the WSJ noted. According to Association of American Railroads figures, U.S. Class I railroads originated 111,068 carloads of crude oil in the second quarter of 2015, down 2,201 carloads from the first quarter and some 21,000 fewer carloads than the peak in 2014’s third quarter.

 

Bakken Crude, Crude By Rail, Derailment, Emergency Readiness & Response, Federal Regulation (U.S.), Fire, Funding for emergency response, Hazmat notification, Massive increase in crude-by-rail, Per-barrel tax, Public safety funding, Rail inspection, Rail Safety, Spill, State regulation, Track maintenance, Volatility

States Step Up Scrutiny of Oil Train Shipments

Repost from GOVERNING The States and Localities

States Step Up Scrutiny of Oil Train Shipments

Some states are looking to prevent more derailments and spills, but the freight industry doesn’t want more regulation.
 By Daniel C. Vock | August 26, 2015
In 2014, several CSX tanker cars carrying crude oil derailed and caught fire along the James River near downtown Lynchburg, Va. (AP/Steve Helber)

When it comes to regulating railroads, states usually let the federal government determine policy. But mounting concerns about the safety of oil trains are making states bolder. In recent months, Oregon, Pennsylvania and Washington state have taken steps to strengthen oversight of the freight rail industry.

The three join several other states — mostly led by Democrats — in policing oil shipments through inspection, regulation and even lawsuits. Washington, for example, applied a 4-cent-per-barrel tax on oil moved by trains to help pay for clean-ups of potential spills. The new law also requires freight rail companies to notify local emergency personnel when oil trains would pass through their communities.

“This means that at a time when the number of oil trains running through Washington is skyrocketing, oil companies will be held accountable for playing a part in preventing and responding to spills,” said Democratic Gov. Jay Inslee when signing the measure this spring.

The flurry of state activity comes in response to a huge surge in the amount of oil transported by rail in the last few years. Oil from the Bakken oil fields in North Dakota and nearby states must travel by train to refineries and ports because there are few pipelines or refineries on the Great Plains. The type of oil found in North Dakota is more volatile — that is, more likely to catch on fire — than most varieties of crude.

Public concerns about the safety of trains carrying oil have increased with the derailments in places like Galena, Ill.; Mt. Carbon, W. Va.; Aliceville, Ala.; Lynchburg, Va.; Casselton, N.D.; and especially Lac-Megantic, Quebec, where 47 people died in 2013.

Federal regulators responded to these incidents by requiring railroads to upgrade their oil train cars, to double check safety equipment on unattended trains, and to tell states when and where oil trains would be passing through their borders. This last requirement was hard won. This summer, the Federal Railroad Administration tried to encourage states to sign nondisclosure agreements with railroads about the location of oil trains. After several states balked, the agency relented.

California, Louisiana, New Jersey, Ohio and Oklahoma have all signed nondisclosure agreements, while Idaho, Illinois, Montana, North Dakota, Washington and Wisconsin have refused to do so, according to the Reporters Committee for Freedom of the Press.

A Maryland judge earlier this month ruled against two rail carriers, Norfolk Southern and CSX, that wanted to block the state’s environmental agency from releasing details of their oil shipments. The railroads have until early next month to decide whether to appeal.

“The ruling isn’t the first time railroads have lost their bid to keep the oil train reports secret,” wrote reporter Curtis Tate of McClatchy, one of the news organizations that requested the records, “but it is the first court decision recognizing the public’s right to see them.”

Many states want this information so that fire departments and other emergency personnel can prepare for a potential derailment. California passed a law last year imposing clean-up fees on oil shipped by rail. The railroad industry challenged the law in court, but a judge ruled this summer that the lawsuit was premature. Minnesota passed a similar law last year, and New York added rail inspectors to cope with the increase in oil train traffic. A 1990 federal law lets states pass their own rules to prepare for oil spills, as long as those rules are at least as rigorous as federal regulations.

In Pennsylvania, which handles 60 to 70 oil trains a week, Democratic Gov. Tom Wolf asked a University of Delaware expert to help to improve safety of oil trains traveling through the state. The professor, Allan Zarembski, produced 27 recommendations for the state and the railroads. He called on the state to improve its inspection processes of railroad tracks, particularly for tracks leading into rail yards, side tracks and refineries that often handle oil trains. The professor also encouraged the state to coordinate emergency response work with the railroads and local communities.

Zarembski’s suggestions for the railroads focused on how they should test for faulty tracks, wheel bearings and axles. Most major derailments in recent years were caused by faulty track or broken equipment, not human error, he noted in his report.

Benicia Planning Commission, Crude By Rail, Public permitting, Valero Benicia Refinery, Valero Crude By Rail

CONFIRMED: Hearings on Valero Crude By Rail to begin on Tues., September 29

By Roger Straw, Editor
[Note:  The revised environmental report will be available for viewing on the City’s website and here on the Benicia Independent.  – RS] 

45-day Public Comment Period begins on August 31, ends on October 15

Today I heard directly from Benicia City Planner Amy Million, confirming that the Recirculated Draft Environmental Report will be released on Monday, August 31, and that the first Public Planning Commission hearing on the Report will be on Tuesday, September 29.  The hearing will begin at 6:30pm in Council Chambers at City Hall, 250 East L Street, Benicia.

ALL INTERESTED PARTIES SHOULD PLAN TO ATTEND THE PLANNING COMMISSION HEARING TO SHARE COMMENTS AND QUESTIONS.  Mark your calendar now!

Ms. Million confirmed that  if after the first hearing there remain more speakers who wish to offer public comments, additional hearings will be held on consecutive evenings: Wednesday, September 30, Thursday, October 1.  A fourth hearing, if needed, will be held on Thursday, October 8 (presumably at the same time and location, but not confirmed at this time).

In an email, Ms. Million wrote, “The number of hearings is determined by the number of speakers, therefore a maximum number is not set.”

The 45-day public comment period will close on October 15.

The City of Benicia welcomes all comments, and your questions and opinions are important as our Planning Commissioners prepare for a decision whether to permit Valero’s proposed Crude By Rail project.  More information and background can be found here on The Benicia Independent – see the menu above or click below for

Note that with the release of the Recirculated Draft Environmental Impact Report, much on this website will be undergoing changes.  Bear with me as we move into this critical review period.
Roger Straw, Editor