Tag Archives: CSX

Bakken Crude, CPC-1232 standard, Crude By Rail, DOT-111

Outdated tank cars carry explosive crude in NY; feds seek refit

Repost from lohud.com, the Journal News
[Editor: Check out the map of rail routes in NY State showing schools, hospitals and shopping centers along the oil train tracks.  (Zoom in on the area about 35 miles north of New York City.)  – RS]

Outdated tankers carry explosive crude; feds seek refit

Khurram Saeed, August 16, 2014

When you see an oil train roll by, you’re probably looking at a DOT-111 tank car.

The DOT-111s are an industry workhorse. They’ve been around for decades and make up 68 percent of the 335,000 tank cars in active use.

Until recently, the non-pressurized cars weren’t used to haul oil. That changed with the Bakken oil boom and when rail became the modern-day pipelines.

The federal government now wants the industry to retrofit or replace them over the next two years in the name of safety. Currently, 100,000 DOT-111s move crude oil and ethanol but only 20,000 meet the latest safety standards, making the older models susceptible to ripping open in a derailment or collision.

Railroads like CSX own fewer than 1 percent of the tank cars; most are owned by the oil industry and leasing firms, the Association of American Railroads says.

The U.S. Department of Transportation wants new tank cars to have thicker outer shells, thermal protection, a full-height head shield, rollover safeguards for top fittings and removable handles on valves that protrude from the bottom of the cars to reduce the risk of opening in an accident.

Eric de Place, a policy director at Seattle-based think tank Sightline Institute, said the valves, which are used to drain fluid, likely would remain even though federal investigators have found they can shear off or open in derailments, causing the car’s contents to spill and possibly catch fire.

“Generally speaking, the oil producers — abetted by the oil shippers and the railroads themselves — have encouraged a go-slow approach to upgrading safety standards,” de Place wrote in an email. “They are principally concerned that requirements to use new tank cars or to retrofit existing ones would cost money and reduce the fleet available to move oil in the near term.”

Phil Musegaas, Hudson River program director for Riverkeeper, said the rules do not go “nearly far enough” to protect the public and the environment, and include loopholes. He said the safer tank cars would only have to be used on trains that have 20 or more rail cars hauling flammable liquids.

“If they don’t like these safety standards, they can continue to ship oil in mixed trains with 19 older DOT-111s on them,” Musegaas said. “It doesn’t take 20 of these cars to cause a horrific accident.”

Riverkeeper and other environmental groups have called on the DOT to ban use of the tank cars immediately, citing an imminent risk to the public.

“How we ship this oil can be figured out later,” Musegaas said. “We need to protect communities that live near these oil trains.”

Sen. Charles Schumer, D-N.Y., has been calling for stricter standards for the “dangerous, crude-carrying” DOT-111s since last year.

“These much-needed regulations will phase out the aged and explosion-prone DOT-111 tanker cars that are hauling endless streams of highly flammable crude oil through Rockland and Westchester counties and lead to commonsense safety measures — like speed limits, new braking controls and standards for a safer tank car — that will further safeguard local communities,” Schumer said.

A newer-model tank car known as the CPC-1232 features many of the higher standards the DOT is seeking but they are not invincible. On April 30, a 105-car CSX oil train derailed in Lynchburg, Va.  Several of the 17 tank cars that went off the track fell into the James River, and a CPC-1232 spilled about 30,000 gallons of Bakken crude oil, causing a massive fire. No one was injured.

The National Transportation Safety Board, which raised issues about the DOT-111s several years ago, said it has concerns about the newer tank cars.

“We have found that the 1232 is also not as robust as is needed,” NTSB spokesman Eric Weiss said.

Farming, Massive increase in crude-by-rail, Rail industry

Rail Logjams Are Putting The Whole US Economic Recovery At Risk

Repost from Business Insider
[Editor: Significant quote: “Many experts blame an incomplete recovery from last winter’s freight backlogs, coupled with record crops and rising competition with crude oil tankers for track space amid an economic recovery.”  – RS] 

Rail Logjams Are Putting The Whole US Economic Recovery At Risk

Susan Taylor and Solarina Ho, Reuters, Aug. 15, 2014

TORONTO (Reuters) – More than eight months after an extreme winter began snarling North American rail traffic, a Reuters analysis of industry data shows delays lingering, raising the risk of a second winter of chaos on the rails.

Across the continent’s seven largest operators, trains ran almost 8 percent slower on average and sat idle at key terminals for nearly three hours longer in the second quarter than a year earlier, data from the main railroads, known as Class 1, show.

While Canada’s rail operators have nearly recovered, many U.S. operators lag far behind.

The concerns are sharpest in the U.S. Farm Belt, with lawmakers fearful that the biggest crops on record may be slow to reach markets or could even rot.

Rail logjams contributed to the economic slowdown early in the year, rippling across corporate America and affecting everything from car makers to ethanol producers.

Many experts blame an incomplete recovery from last winter’s freight backlogs, coupled with record crops and rising competition with crude oil tankers for track space amid an economic recovery.

“It’s like a sinking ship – you’re bailing out at one end, but it’s coming in the other end just as fast, if not faster,” said Citigroup Global Markets transportation analyst Christian Wetherbee.

Performance fell behind as loads grew: between April and June, U.S. rail carload volumes grew 5.4 percent and intermodal traffic, which include shipments partly by rail, rose 8 percent, Association of American Railroads (AAR) data shows.

At the same time, the industry is producing “tremendous” margins, profit and cash flow, with some companies setting records, said rail analyst Tony Hatch.

The largest operators plan to spend about 18 to 20 percent of annual revenue this year on new terminals, track, sidings and equipment to help boost capacity and efficiency, according to Thomson Reuters data. That is slightly higher than recent average annual spending.

Some shippers complain that spending hasn’t been sufficient to meet demand, especially in bad weather. Still, many investment projects are multi-year improvements that can’t quickly fix traffic jams.

“We’re criticized … because we haven’t put infrastructure in to handle the growth. But then when you try to put infrastructure in, the not-in-my-backyard lobby kicks in and says: We don’t want you here,” Canadian Pacific Railway Ltd Chief Executive Hunter Harrison said on a recent earnings conference call.

Over the four decades to 2000, the nation’s major track system shrank by about half, in terms of miles of rails, according to the U.S. Federal Highway Administration.

Although Berkshire Hathaway’s BNSF Railway Co is spending a record $5 billion this year, its performance lagged those of competitors last quarter.  BNSF trains traveled 11 percent slower than year-ago speeds, and stayed at terminals for 18 percent longer.

Fadi Chamoun, an analyst at BMO Capital Markets, said BNSF is unlikely to recover until mid- to late-2015 due to the amount of work it must do.

In recent years, BNSF accounted for some 50 percent of the entire rail industry’s volume growth, analysts said. The company says it handles up to 15 percent of U.S. intercity freight.

BNSF declined to respond to Reuters’ questions about its performance metrics. The Fort Worth, Texas-based railway has said it is working closely with shippers to clear backlogs and adding track, locomotives and crews.

The other four U.S. Class 1 railroads are CSX Corp, Kansas City Southern, Norfolk Southern Corp and Union Pacific Corp.

Kansas City Southern and Norfolk Southern did not respond to requests for comment. CSX said it was investing in strategic capacity additions and was adding train crews and locomotives to restore performance and support growth. Union Pacific CEO Jack Koraleski told Reuters that the railroad’s performance has been improving even as volumes have been increasing, adding that it has worked hard to address disruptions and customer issues.

Cowen & Co analyst Jason Seidl said winter exacerbated problems for the industry. “As they were trying to dig out, the volumes took off,” he said.

ECONOMIC FALLOUT

In the United States, more than 40 percent of goods, valued at more than $550 billion, are shipped by railroad each year on some 140,000 miles of track. Canada’s 30,100 miles of track carry half of the country’s export goods.

Frozen transportation links contributed to a nearly 3 percent contraction in the U.S. economy during the first quarter, the New York Federal Reserve said last week.

Lawmakers and the $395 billion agricultural industry fear that trains may fail to clear last year’s record-breaking crops in the Midwestern U.S. Farm Belt, which could strand part of this summer’s grain harvest.

“We’re sounding the alarms right now,” North Dakota Senator Heidi Heitkamp told Reuters. “We believe the 2014 crop could be taken off the fields and there won’t be any place to store it, because of the lack of ability to move product by rail.”

BNSF and Canada’s CP Rail operate the main rail networks in North Dakota, where farmers vie for space with some 700,000 barrels per day of crude oil shipped by rail from the state’s Bakken Shale.

“You can’t see these massive increases in crude-by-rail and not appreciate that they are creating problems for moving agricultural products,” Heitkamp said.

Members of Congress, utility companies, the United States Department of Agriculture and others are asking the U.S. rail regulator, the Surface Transportation Board, for help.

“With remaining grain in storage due to the backlog, grain elevators in some locations, such as South Dakota and Minnesota, could run out of storage capacity during the upcoming harvest, requiring grain be stored on the ground and running the risk of spoiling. The projected size of the upcoming harvest creates a high potential for loss,” USDA Under Secretary Edward Avalos wrote to the regulator this month.

Utility Xcel Energy said coal deliveries to a key Midwest facility were behind schedule.

“When we run out of coal, the plant can’t produce electricity. We are right in the middle of summer when air-conditioning load creates our highest levels of electric demand,” Xcel Chief Executive Ben Fowke wrote in a letter to the STB at the end of July.

Since an April 10 hearing on rail service, the STB has issued several orders, primarily involving CP and BNSF. The most recent directive, issued in June, required the two railways to publicly file their plans to resolve their backlog on grain orders and provide a weekly update on grain car service. It declined to comment on complaints or its plans.

Earlier this month, the Canadian government ordered Canadian National Railway Co and CP to further boost regulated grain shipments, in an effort to prevent a repeat of last season’s backlog.

Recent University of Minnesota data showed that transportation bottlenecks cost the state’s soybean, corn and spring wheat farmers nearly $100 million between March and May.

United Parcel Service Inc, the world’s largest courier company, said that “very poor” railroad performance last quarter raised its costs. Even passenger service Amtrak has been affected, with some of the trains it runs on Class 1 tracks falling far behind schedule.

Canada’s biggest rails, CN and CP, operated their trains at speeds 4.7 percent and 3 percent slower in the second quarter than year-ago levels respectively, better than most U.S. rivals.

CN said its ability to avoid Chicago, a hub notorious for bottlenecks, helped its sector-leading recovery. In 2009, CN bought a rail network that encircles Chicago, the Elgin, Joliet and Eastern Railway Co.

CHICAGO BLUES

Chicago’s third-snowiest winter on record severely tangled traffic at a hub that handles one quarter of the nation’s freight-by-rail and has recently become a major conduit for Bakken crude.

Data from Union Pacific shows its trains idled in Chicago for an average 65 hours in February, around double the typical time for much of 2013.

Following a severe 1999 blizzard that paralyzed trains for days, government and railroads launched a $3.8 billion plan to improve the Chicago system.

That’s not a quick solution for the industry’s woes.

“It takes a long time for new lines and new terminals to get built, and additional locomotives to be delivered and additional crews to be trained,” said Steve Ditmeyer, an adjunct professor at Michigan State University’s Railway Management Program.

“There’s a time lag that the railroads cannot snap their finger and, all of a sudden, get out of the current problem.”

(With additional reporting by Joshua Schneyer and Jonathan Leff in New York, and Sagarika Jaisinghani in Bangalore; editing by Joshua Schneyer and Peter Henderson)
Bakken Crude, Bridge safety, Crude By Rail, Federal Regulation (U.S.), Massive increase in crude-by-rail, Rail inspection

Bridge wake-up call

Repost from Philipstown.info, Philipstown, NY
[Editor: This story out of New York is a wake-up call for us all.  Bridge safety in Northern California is a serious issue, and  we have heard little discussion on the subject as Valero  proposes to bring oil trains over the Sierra, through the Sacramento River Valley and  across the protected Yolo  Basin and Suisun Marsh.  Another refinery proposes to send these trains over the 85-year old Benicia Bridge, then alongside our beautiful Carquinez Strait and down through the heavily populated communities on the east shore of the San Francisco Bay.  – RS]

CSX Says Bridge Safe

Crude oil trains make daily crossings

By Michael Turton, August 1, 2014

A railway bridge located on the Hudson River across from Cold Spring has visibly deteriorated however its owner says it remains fit for daily use by freight trains. The bridge is located at milepost 51 on the River Line, a 132-mile stretch of track that runs from northern New Jersey to Selkirk, New York, just south of Albany. The bridge and the tracks are owned by the Florida-based CSX Corporation. At the bridge, the tracks are located just a few feet from the riverbank.

Concrete has crumbled beneath one of the bridge's vertical supports.

The span in question, along with a second bridge a few hundred yards to the south, crosses over a pair of narrow channels that enable waters from a wetland located west of the tracks to flow in and out freely as river levels change due to tides, wind and rain. Concrete that forms a part of the bridge’s structure has crumbled beneath a vertical support directly under the tracks.

In an email to The Paper, CSX Spokesperson Kristin Seay, said that the bridge is “current” with regard to its annual inspection. “It was last inspected on Feb. 6, 2014, and was determined to be safe for railroad operations.” Seay said that all CSX bridges are inspected annually.

The bridge to the south also shows signs of deterioration but to a lesser extent. On that structure, concrete has fallen away, exposing the reinforcing metal bar.

Oil transport by rail on the rise

The condition of tracks and bridges along the Hudson River has become more significant locally as part of a national trend which has seen an exponential increase in the transport of crude oil and other hazardous materials by rail in recent years. On July 23, 2014, USA Today reported that “The number of oil-carrying cars run by seven major U.S. railroads jumped from 9,500 in 2008 to 407,761 in 2013…” Closer to home, Seay told The Paper that “CSX operates an average of two to three loaded crude oil trains per day over (the River Line) route…” That adds up to between 700 and 1,000 crude-oil trains that pass directly across from Philipstown each year.

An average of two or three trains carrying crude oil cross over the bridge daily.

Two high profile, rail-related tragedies that occurred in recent months no doubt add to local concern. Last July, in Lac-Megantic, Quebec, a train loaded with oil exploded, killing 47 people. Local insurance claims were estimated at $50 million. And in May of this year, a train derailed in Lynchburg, Virginia, dumping some 50,000 gallons of crude oil into the James River.

A July 23 editorial in the Albany Times Union underscored what it called “failure of government to adequately ensure rail safety” as evidenced by such accidents.

Federally regulated

Freight rail lines in the U.S. are regulated almost entirely at the federal level by the Federal Railroad Administration (FRA). Federal law requires that all railroad companies inspect their own bridges on an annual basis — regardless of the size of the bridge. Companies must determine the load capacity of each bridge, certifying to the state where it is located that it is capable of bearing the daily load it must handle.

On July 23, the Federal Department of Transportation proposed comprehensive rules to improve crude oil transportation safety. Recommendations include an immediate phasing out of older tank cars, new standards for tanker cars that carry highly hazardous materials, reduced operating speeds, and required notification of first responders.

At the state level, the New York State Department of Transportation’s (DOT) Rail Safety Inspection Section participates in FRA safety programs — mainly for staff training and certification. Beau Duffy, DOT Director of Communications, told The Paper that the agency also conducts random inspections or “blitzes” of rail facilities, focusing on track conditions and mechanical equipment such as brakes and wheels. He said that DOT does not however inspect bridges.

National issue … local focus

The deteriorating bridge across from Cold Spring brings what has become a significant national issue into very local focus.

Commenting on the CSX bridge, a Federal Railroad Administration official told The Paper that the FRA would work with CSX to ensure it is in compliance with all federal safety standards noting that FRA inspectors regularly evaluate railroad companies’ bridge safety practices to identify potential weaknesses.

Local senior-elected officials also commented on the River Line bridge. “Like many of my neighbors, I’m extremely concerned about the integrity of this bridge,” said Rep. Sean Patrick Maloney (D-18th District, NY), when notified of the issue by The Paper. “I immediately brought this to the … attention of CSX, and I’ll work closely with officials to ensure inspections are conducted and any necessary repairs are done promptly. With billions of gallons of oil barreling down the Hudson, we must be vigilant that issues like this are addressed quickly — the safety of our neighbors, environment and communities is far too important.”

Maloney is a member of the House Transportation and Infrastructure Committee, and has been working with the chairman of that committee to examine the environmental and economic impact of shipments of crude oil along the Hudson River.

New York State Sen. Terry Gipson (D-Dutchess, Putnam) also commented. “The impact of an oil train incident along the shore of the Hudson River would be devastating to our communities who rely on the river for their drinking water and our local economy,” Gipson said via email. “That is why I … have expressed strong concerns to our federal government about the need for safety improvements relating to the interstate transportation of crude oil along the Hudson River. This effort includes ensuring necessary track maintenance and infrastructure investments that will allow businesses to operate more effectively and safely.”

Photos by M. Turton

Bakken Crude, Crude By Rail, Emergency Readiness & Response, Federal Rail Administration, Hazmat notification, Niobrara crude, Rail industry, State regulation, Tank car design, Train speed

Oil Boom, Part II: How and why railroads keep oil train information from communities

Repost from Boulder Weekly
[Editor: A good summary on the various states’ responses to weak new federal emergency regulations, and the oil and rail industries’ resistance to same.  – RS]

Oil Boom, Part II: How and why railroads keep oil train information from communities

By Matt Cortina, Thursday, July 31,2014

Last week’s Boulder Weekly cover story “Oil Boom” covered the proliferation of trains carrying volatile crude oil in outdated oil tanks through the hearts of Longmont, Boulder and Louisville. With industry estimates of an oil boom in the nearby Niobrara shale formation, Boulder County residents can expect that the risk of a potential explosion from an oil train will increase over the next decade.

On the day that story was published, documents were leaked from the state of Washington’s Military Department that showed the U.S. Department of Transportation and U.S. railroad companies like Burlington Northern Santa Fe (BNSF) and Union Pacific pressured states to keep information about oil trains concealed from the public.

And so this brief part II to “Oil Boom” will take a look at why railroads are not required to tell citizens about oil trains, why this information needs to be a secret at all and how railroads are now working to enact soft oil transportation standards in order to save billions in revenue.

• • • •

Railroad companies have never been required to tell citizens, municipalities or states the contents of their train cars. Then, in May, the U.S. Department of Transportation ordered railroad companies to disclose to state emergency responders how many trains carrying one million gallons or more of crude oil from the Bakken shale region in North Dakota were coming through that state. This came after nine oil trains, many carrying Bakken crude oil, exploded or derailed in the last 12 months in the U.S. and Canada.

In response, railroad companies asked states to sign a confidentiality request form that would keep that information from being passed on to the public. Some states like California, New Jersey and Virginia signed the agreement. Colorado did not sign the agreement, but did ultimately decide to keep the information confidential.

Conversely, some states, such as Washington, North Dakota and Wisconsin, decided to make the information public. This was not without contention from the rail companies. When Montana said it would do the same, BNSF promptly wrote to the state that it would consider legal action to keep the information hidden.

And in Washington, one state official wrote in an email (obtained by DeSmogBlog), “looks like UP is trying to put the burden on us vis-à-vis information transfer on oil trains,” noting that Union Pacific’s confidentiality request claimed states were requesting information about Bakken crude oil shipments, instead of that railroads are now required to share that information.

All this fuss from railroad companies concerns just one mandate on one very large amount of oil from one of several drilling areas nationwide. And that information doesn’t need to be sent until 30 days after trains pass through the state.

This mandate is effectively irrele vant for Boulder County. Crude oil shipped through the county comes from the Niobrara in Northern Colorado. Transporting this crude, like everything that’s not one million gallons of Bakken crude, does not require notification even though it can still overheat and explode and it is still shipped in outdated, dangerous tanks.

What is relevant is that the Niobrara shale region has been deemed by the oil and gas industry as the “next Bakken” region, so legislation and precedent for that region will affect how crude oil is transported through Boulder County in the future.

Now, railroads can keep the majority of oil train information hidden from the public because they have help from federal and state officials.

For instance, in ordering railroads to share Bakken crude oil train information with local emergency responders, the U.S. Department of Transportation also encouraged states to keep that information from the public in a FAQ that accompanied the emergency order.

Mark Davis, Union Pacific regional media director, says the issue is that railroads could face “security” issues if conservative monthly data about crude oil transportation is made public.

“A lot of that is the historic security concerns that were started following 9/11,” says Davis. “I know that is something that on the security side, that from a federal standpoint, they’re taking a look at and reviewing that process.”

Davis added that he was “not sure” if any actual threats to Union Pacific oil trains have been recorded, but that the security detail on crude oil transport via rail is “massive” and involves national, state and local authorities.

According to Dave Hard, director of the Colorado Division of Emergency Management, the state of Colorado is keeping what little oil train information it does receive hidden from the public not because of security concerns but because it is “business confidential.”

“The original guidance we received from the Department of Transportation […] made it clear that at the time, the federal D.O.T. considered it security sensitive and business confidential,” Hard says.

Hard says his department and the Colorado Department of Public Health and Environment and the Colorado Department of Public Safety then reviewed the Colorado Open Records Act (CORA) standards and agreed that crude oil shipments were still “not subject to public disclosure.”

“They still maintain business confidentiality viewpoints. The state is still honoring that [all oil train information] is not for public disclosure, it is for the purposes of preparing [emergency response personnel],” Hard says.

Railroads are also subject to the Emergency Planning and Community Right-to-Know Act, which requires them to report the transport of hazardous materials to local and state emergency responders. But, for some reason, petroleum products including crude oil are exempt from this mandate.

The bottom line is that railroads are privately owned and not required to notify anyone of the contents of their trains. They are, at least, required to make their transport of volatile materials safe.

The Department of Transportation recently issued safety recommendations for railroads carrying crude oil. These recommendations included updated tank cars, new routing systems and reducing the speed of oil tank cars.

But railroads like BNSF, Union Pacific and CSX said implementing these safety measures would be too costly.

In a presentation to the White House Office of Information and Regulatory Affairs, which will amend and codify the safety standards introduced by the Department of Transportation, presenters for the railroads laid out the costs of implementing moderate safety measures.

First, railroads would pay $2.8 billion for capital improvements to railways across the country. Reducing the speed of trains would call for oil companies to build more tankers to the tune of $1.5 billion in order to maintain supply quotas. Reducing train speed would also cost the railroads themselves about $630 million per year because they’d have to pay for additional crew, fuel costs and “lost productivity of track maintenance workers.”

Train speed and outdated tank cars are by far the most common cause of derailments and explosions. Tank cars are not built for modern crude oil and train speed has many times caused modern volatile crude oil to overheat and explode.

BNSF went on to say that implementing these safety measures would take about four years and would result in “the immediate loss of existing business” and growth would be stifled.

Railroad officials and lobbyists are currently working beside federal lawmakers to carve out the new safety and notification rules for crude oil by rail transport. Initial regulations could come as soon as this year.