Safety of shipping oil by rail addressed in appropriations bill
By Jodi Weigand, Dec. 17, 2014
Provisions pushed by U.S. Sen. Bob Casey to improve the safety of crude oil shipments are included in the final version of the appropriations bill that will fund the federal government for the next nine months.
Casey began pushing for more money for rail safety after three train derailments in the state this year, including one in Vandergrift in February.
“This program was not included in the original House bill, so it needed a strong push from the Senate (and) Casey to make it in the final package,” said Casey’s spokesman John Rizzo.
The $54 billion in appropriations for transportation, housing and urban development includes funding for 15 new rail and hazardous material inspectors. It also calls for $3 million to expand the use of automated track inspections for 14,000 miles of track and $1 million to pay for online training for first responders on how to handle train derailments.
The Senate on Saturday approved the 2015 Omnibus Appropriations Bill that the House narrowly passed Thursday.
Casey’s bill requires the Pipeline and Hazardous Materials Safety Administration to finalize regulatory action to change tank car design standards by Jan. 15. The PHMSA began the changes in September 2013.
Among the new requirements is that newly manufactured and existing tank cars that are used to haul crude oil have puncture resistance systems and protection for hatches and valves that exceed the existing design requirements for the DOT-111 tankers, an old-style variety that critics say are too flimsy.
In the event that there is a trail derailment that involves a crude oil spill, new funding will ensure that first responders have better training on how to handle it.
The money in the bill for a web-based hazardous materials emergency response training curriculum will help ensure that communities that lack the resources to send their first responders to training sites can still access education to contain oil spills and prevent danger to people and communities.
“Funding will also be used to expedite implementation of a remote automated track inspection capability to increase inspection mileage at a reduced cost,” Rizzo said. “There is too much track for manual inspections to cover it all.”
U.S. Sen. Patty Murray, D-Wash., chairwoman of the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development, said she’s pleased the bill would mandate comprehensive oil spill response plans for railroads and provide funding focusing on providing safety training.
“I worked to set a deadline for the Department of Transportation to issue new safety standards for tank cars next month and worked to protect smaller communities without sufficient resources to respond to oil trains,” Murray said.
A federal investigation into the Feb. 13 derailment and oil spill in Vandergrift determined that “widening,” or spreading of the rails on that section track, was the probable cause.
The report said that speed did not cause the derailment. However, two railroad experts said it was a contributing factor because speed could have caused track problems on the curve.
Railroads say California lacks authority to impose safety rules on oil shipments
By Tony Bizjak and Curtis Tate, Oct. 8, 2014
Virginia emergency responders learn about the different types of railroad tank cars in a safety class at a CSX yard in Richmond, Va., on Oct. 3, 2014. About 66 first responders, including firefighters, participated in the daylong event. CSX has brought its “Safety Train” this year to communities in states where it hauls large volumes of crude oil. (Curtis Tate/McClatchy)
The battle over crude oil trains in California intensified this week, reaching into the legal sphere with potential national repercussions.
The state’s two major railroad companies, Union Pacific and the BNSF Railway, went to federal court Tuesday to argue that neither California nor any other state can legally impose safety requirements on them because the federal government already does that.
The lawsuit came days after California Attorney General Kamala Harris joined other officials in challenging one crude-by-rail project, in the Bay Area city of Benicia. In a letter to Benicia officials, Harris said the city has failed to adequately analyze the potential environmental consequences of Valero Refining Company’s plan to ship two 50-car oil trains daily through Northern California to its Benicia refinery.
Those shipments would run through downtown Sacramento and other Valley cities.
The Valero project and similar plans by other oil companies prompted the state Legislature this summer to pass a law ordering railroad companies to submit an oil spill prevention and response plan to the state, and to provide proof to the state that they have enough money to cover oil-spill damages.
Railroads fired back this week, filing a lawsuit in the U.S. District Court in Sacramento. Their argument: Federal law pre-empts the state from imposing safety restrictions on the railroads.
The suit was filed by the two largest railroads in the Western United States, Union Pacific and BNSF Railway Co. The industry’s leading trade group, the Association of American Railroads, is listed as co-plaintiff.
The fight involves a long-standing friction point between railroads and U.S. states and cities. Railroads contend that local governments cannot place requirements or restrictions on freight travel because federal laws cover that ground.
The railroads have used the federal pre-emption argument to stop states from trying to impose speed limits on trains and ban certain types of shipments. In one notable case, railroads got the courts to overturn a Washington, D.C., law that attempted to ban trains carrying hazardous materials from using tracks within 2 miles of the U.S. Capitol.
“Federal law exempts this entire regime,” the railroads declared in the California lawsuit. Citing “a sweeping set of intricate federal statutes and regulations,” the lawsuit argues that allowing states to impose a “patchwork” of requirements on railroads essentially interferes with interstate commerce.
In a separate email statement Wednesday, BNSF spokeswoman Lena Kent said, “The state gives the industry no choice but to challenge the enforcement of the new law so as to not inhibit the efficiencies and effectiveness of the freight rail industry and the flow of commerce.”
Officials at the state Office of Spill Prevention and Response, the state agency listed as the defendant in the case, declined comment Wednesday, saying the agency does not publicly discuss pending litigation. Harris’ office is listed as a co-defendant.
The U.S. Department of Transportation in July proposed a rule that would require railroads to have oil spill response plans for trains carrying large volumes of crude oil. But that proposal could be months away from becoming law.
National transportation law and safety experts say the onus may be on California to prove that it is not usurping federal law or impeding interstate commerce.
“The state has to prove it is tackling what is a local or statewide issue, that it is not incompatible (with federal law) and doesn’t unreasonably burden interstate commerce,” said Brigham McCown, an attorney and former head of the federal Pipeline and Hazardous Materials Safety Administration. “That is a high bar.”
California might have an opening in a 2007 law Congress passed after the 9/11 Commission issued its recommendations. The 9/11 Act required rail companies to develop security plans and share them with state and local officials. The requirement was not limited to planning for a terrorist attack, but for any rail disaster, including derailments and spills involving hazardous materials.
“Those plans are required to be done and required to be shared,” said Denise Rucker Krepp, the former senior counsel on the House Homeland Security Committee, who wrote the provisions.
The Transportation Security Administration has not enforced the requirement, Krepp said, partly because of its focus on aviation security. But now that the railroads have taken California to court, Krepp said the state could use the 9/11 Act as leverage to get what it tried to get from the railroads through legislation.
“It’s never been tested like this,” Krepp said of the federal law.
It was unclear Wednesday whether the railroads also are challenging the section of the California law that imposes a 6.5-cent fee on oil companies for every barrel of crude that arrives in California on rail, or that is piped to refineries from inside the state. The resulting funds, estimated at $11 million in the first full year, will be allocated for oil spill prevention and preparation work, and for emergency cleanup costs. The efforts will be focused on spills that threaten waterways, and will allow officials to conduct response drills.
Crude-oil rail shipments have risen dramatically in the last few years. Those transports, many carrying an unusually flammable crude from North Dakota, have been involved in several spectacular explosions, including one that killed 47 residents of a Canadian town last year. Federal officials and cities along rail lines have been pushing for safety improvements. California officials have joined those efforts, saying they are concerned by estimates that six or more 100-car oil trains will soon be rolling through the state daily on the way to coastal refineries.
Harris, the state’s top law enforcement official, sent a letter to Benicia city planners challenging that city’s conclusion in an environmental impact report that the Valero rail shipment plan poses an insignificant threat of derailment. The report, she writes, “underestimates the probability of an accidental release from the project by considering only a fraction of the rail miles traveled when calculating the risk of a derailment.”
“These issues must be addressed and corrected before the City Council of Benicia takes action” on the project, Harris wrote.
Harris’ letter repeats earlier criticism leveled by the state Office of Spill Prevention and Response and state Public Utilities Commission.
The letter is one of hundreds Benicia has received in the past few months in response to the city’s initial environmental study. Benicia interim Community Development Director Dan Marks said the city and its consultants would review the comments and prepare responses to all of them, then bring those responses to the city Planning Commission for discussion at an as-yet undetermined date.
Under the Valero proposal, trains would carry about 1.4 million gallons of crude oil daily to the Benicia refinery from U.S. and possibly Canadian oil fields, where it would be turned into gasoline and diesel fuel. Valero officials have said they hope to win approval from the city of Benicia to build a crude-oil transfer station at the refinery by early next year, allowing them to replace more costly marine oil shipments with cheaper oil.
A representative for the attorney general declined comment when asked if Harris would consider suing Benicia to force more study of the project.
“We believe the letter speaks for itself,” spokesman Nicholas Pacilio said. “We expect it will be taken seriously.
SACOG – representing 6 counties and 22 cities – to file objections by Sept 15 deadline
August 21, 2014
[Editor: This is an edited version of an email by Lynne Nittler of Davis, CA, who attended the meeting. – RS]
The 28-member Board of the Sacramento Area Council of Governments (SACOG) met on August 21, 2014, and listened to 15 community member comments from Davis, Sacramento, Dixon and Benicia who thanked them for their thorough and well-documented letter on uprail concerns not adequately addressed in the Benicia Valero Crude-by-Rail Project DEIR. All urged the Board to submit the letter.
In addition, SACOG counsel Kirk Trost, who researched and wrote the letter, explained his efforts to execute their directions and stood by his letter. A spokesperson from Valero claimed that many of the requests in the letter should be directed to the federal government due to federal preemption. Union Pacific offered to serve as an information resource as they are not technically involved; however their letter to SACOG (also submitted to the DEIR) stresses federal preemption and states outright, with citations of similar cases, that ”neither SACOG nor its member agencies has authority to impose the mitigation measures or conditions proposed in the draft Comment Letter on Valero Crude by Rail Project Environmental Impact Report.”
The SACOG Board held to their original plan to submit the letter which they commended and believed stated the truth of the inadequacies of the DEIR. With just one substitute Director attempting to dismiss or weaken the letter unsuccessfully, the rest of the Board voted to submit the letter.
In the next item on their agenda, the SACOG Board agreed to look at the comments developed by Mr. Trost on the federal DOT Rule-making document presently open for public comment through the end of September. (For information on how to send your comment to the Pipeline and Hazardous Materials Safety Administration, see Two-month comment period starts for new federal oil train rules.)
It remains to be seen how this all plays out legally, as Valero and UP are powerful players who are used to winning.
The Sacramento Air Quality Management District will shortly send their letter, another strong one, but more narrowly focused on air quality issues. Also, watch for letters from the cities of Davis (city council on Sept. 2), Sacramento, Roseville, and Colfax.
Regulators Ignore One Proven Way to Eliminate Bakken Bomb Trains: Oil Stabilization
Justin Mikulka, 2014-08-08
On the same day that the Obama administration released long-awaited new safety regulations for the oil-by-rail industry, the Pipeline and Hazardous Materials Safety Administration (PHMSA) released another report with their testing results for Bakken crude oil. The conclusion reached by PHMSA is that Bakken crude oil “is more volatile than most other types of crude.”
These results don’t come as a surprise since the five oil trains that have crashed and exploded in the last year all were carrying Bakken crude.
Of course, the new regulations released simultaneously do not require the oil industry to do the one thing that would eliminate this problem: oil stabilization. A well known and proven method for removing the natural gas liquids from crude oil that makes the oil “stable” and non-explosive.
While the new regulations do not offer any proposals to require the oil industry to remove the volatile components of Bakken crude, on page 144 of the proposal they do acknowledge that this is possible. They request comments on the following question:
Is the current exception for combustible liquids sufficient to incentivize producers to reduce the volatility of crude oil for continued use of existing tank cars?
Essentially they are acknowledging that if the industry stabilized the oil it wouldn’t be explosive and thus they would be able to continue to use the existing DOT-111 rail cars to transport it. Just like those tank cars will be able to transport Alberta tar sands oil because it is not explosive.
The week before the release of the new regulations, the American Petroleum Institute and the American Association of Railroads released a joint statement stating that they were in agreement on two things that shouldn’t be part of the finalized new regulations — lower train speeds and mandatory stabilization. And while the proposed regulations do offer some requirements for lower trains speeds, they include nothing about mandatory stabilization.
In May, Myron Goforth, the president of Dew Point Control LLC, a manufacturer of stabilization equipment put the situation in simple terms for Reuters.
“It’s very easy to stabilize the crude – it just takes money,” Goforth said. “The producer doesn’t want to pay for it if he can ship it without doing it.”
So without regulations to require the stabilization of Bakken crude, the public will be put at risk so that the oil companies can make higher profits. And with the new proposed regulations, the regulators have made it clear they will not stand in the way of Big Oil to keep the people safe.
The good news for the public is that Big Oil’s greed might actually lead to them having to stabilize Bakken crude.
There is currently a major lobbying effort by the oil industry to lift the ban on exporting American crude oil. And in order to ship the oil to other countries, the oil companies may be required to stabilize the Bakken crude. One industry analyst recently commented to Platts on what would happen if stabilization was required for export.
“You could stabilize and go. You’d still have to put it into rail cars and ship it to the coast, but at least you’d be selling it at a global market price instead of at the WTI discount. Who wouldn’t do that? Everybody would do it.”
On June 2nd Quantum Energy met with OIRA and presented a simple three-page presentation. The presentation explains how regular crude oil has a Reid Vapor Pressure (RVP) of 5-7 psi and Bakken crude has an RVP between 8-16 psi. To put that in perspective, gasoline typically has a RVP of 9 psi.
Higher RVP correlates to higher volatility and explosiveness.
The last slide in the Quantum presentation shows that “post stabilization” Bakken crude would have a RVP of 1.5 – 6 psi.
So why was an energy company arguing the case for stabilization to OIRA prior to the new regulations? Because they are in the stabilization business and they are getting ready for the export ban to be lifted.
“We’re not advocating if they do or if they don’t [require stabilization]. Quite frankly, we don’t care. Our business plan is centered around exportability.”
It appears that the safety of the people located within the blast zones of the bomb trains will not ultimately be addressed by regulators until the oil can be shipped to other countries, at which point they will require the oil to be stabilized to reduce the risk of explosions.
As the analyst said, “Who wouldn’t do that? Everybody would do it.”
Image credit: Lac-Megantic deadly oil-by-rail disaster, via Shutterstock.
