Tag Archives: South Dakota

Pipeline infrastructure, Pipeline transport

North Dakota pipeline construction halted until court date

Repost from Minnesota Public Radio

North Dakota pipeline construction halted until court date

Business Associated Press · Bismarck, N.D. · Aug 18, 2016
Native Americans protest Dakota Access pipeline
Native Americans protest Dakota Access pipeline. James MacPherson | AP Photo File

Developers of a four-state oil pipeline have agreed to halt construction of the project in southern North Dakota until a federal court hearing next week in Washington, D.C.

The temporary construction shutdown comes amid growing protests and increased tension over the Dakota Access Pipeline that is intended to cross the Missouri River near the Standing Rock Sioux reservation that straddles the North Dakota-South Dakota border.

Some things to know about the pipeline and the protest:

What is the Dakota Access Pipeline?

Dallas-based Energy Transfer Partners’ Dakota Access Pipeline is a $3.8 billion, 1,172-mile project that would carry nearly a half-million barrels of crude oil daily from North Dakota’s oil fields through South Dakota and Iowa to an existing pipeline in Patoka, Illinois, where shippers can access Midwest and Gulf Coast markets.

Why the protest?

The Standing Rock Sioux Tribe is suing federal regulators for approving the oil pipeline that would be the largest-capacity one carrying crude out of western North Dakota’s oil patch.

The tribes’ lawsuit filed last month in federal court in Washington challenges the U.S. Army Corps of Engineers’ decision to grant permits at more than 200 water crossings in four states for the pipeline.

The tribe argues the pipeline that would be placed less than a mile upstream of the reservation could impact drinking water for the more than 8,000 tribal members and the millions who rely on it further downstream.

The lawsuit, filed on behalf of the tribe by environmental group Earthjustice, said the project violates several federal laws, including the National Historic Preservation Act.

The tribe worries the project will disturb ancient sacred sites outside of the 2.3-million acre reservation. The hearing on the tribe’s request for a temporary injunction is slated for Wednesday.

Who are the protesters?

Mostly members of the Standing Rock Sioux tribe, but they’ve been joined by other American Indians and non-Native Americans from across the country. “Divergent” actress Shailene Woodley was part of the protests last week.

Arrests

American Indians have for months been staging a nonviolent protest at a “spirit camp” at the confluence of the Cannonball and Missouri rivers in the path of the pipeline.

More than a dozen young people from the reservation also ran from North Dakota to Washington to deliver 140,000 petition signatures to the Corps to protest the pipeline.

The protest took a turn last week when law enforcement was called to keep the peace between protesters and armed security guards hired by the company.

Twenty-eight people have been arrested since then and charged with interfering with the pipeline construction, including Standing Rock Sioux Tribal Chairman David Archambault II.

Developers on Monday sued in federal court to stop protesters, alleging the safety of workers and law enforcement is at risk.

Is the pipeline safe?

The company said the pipeline would include safeguards such as leak detection equipment, and workers monitoring the pipeline remotely in Texas could close block valves on it within three minutes if a breach is detected.

Why the need

Energy Transfer Partners announced the Dakota Access pipeline in 2014, a few days after North Dakota Gov. Jack Dalrymple urged industry and government officials to build more pipelines to keep pace with the state’s oil production, which is second only to Texas’.

Supporters said the pipeline would create more markets for the state’s oil and gas, and reduce truck and oil train traffic, the latter of which has been a growing concern after a spate of fiery derailments of trains carrying North Dakota crude, including one near Dalrymple’s hometown of Casselton in 2013, and an explosion in Quebec that same year that killed 47 people.

Bakken Crude, Crude By Rail, Disclosure of tank car contents, Federal pre-emption, Federal Regulation (U.S.), Hazmat notification

Vandalism on inactive rail line used to justify oil train secrecy

Repost from The Bellingham Herald

Vandalism on inactive rail line used to justify oil train secrecy

By Curtis Tate, McClatchy Washington Bureau, May 10, 2015
A train carrying tanker cars filled with crude oil passes through St. Paul, Minnesota, on February 27, 2013. JIM GEHRZ — Minneapolis Star-Tribune/MCT

Part of the federal government’s justification for keeping details about oil trains secret is literally hiding in the weeds on the South Dakota prairie.

Itself hidden on page 255 of the U.S. Department of Transportation’s 395-page final rule on trains carrying large volumes of flammable liquids, the example is sure to raise additional questions about the government’s decision to shield routing and volume details on oil trains from public view.

Such details have been publicly available for the past year, at least about weekly shipments of 1 million gallons or more of Bakken crude oil. But rail and oil companies have been adamant that the government drop the disclosure requirement it imposed last May, citing concerns about security and business confidentiality.

In its rule, the department cited an investigation by the FBI and the Bureau of Alcohol, Tobacco, Firearms and Explosives into an act of vandalism reported last December in Vivian, S.D.

According to investigators, a two-foot section of rail on the state-owned Dakota Southern Railway was blown out with tannerite, an explosive used in target practice that can be purchased at sporting goods stores.

In its rule, the department notes that “widespread access to security sensitive information could be used for criminal purposes when it comes to crude oil by rail transportation.”

But not only is the track through Vivian not used for oil trains, it hasn’t been used by any train for years.

Publicly searchable photos show that the rail line is clearly out of service, its rusting rails barely visible, if at all, under prairie grass. Several road crossings along the route have been paved over, including the one where U.S. Highway 83 crosses the track in Vivian.

Officials didn’t even notice the missing piece of rail for weeks.

South Dakota bought the nearly 300-mile rail line connecting Mitchell and Rapid City from the bankrupt Milwaukee Road in the early 1980s to preserve train service for grain-producing communities.

While part of the eastern end of the line has come back to life in recent years, thanks to federal and state investment, the western half, including the track that runs through Vivian, has mostly been out of service.

McClatchy received partial or full reports on Bakken oil trains from 24 states last year through their open records laws. South Dakota was one of those states, and the Dakota Southern Railway was not labeled as an oil train route.

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)
Farming, Rail industry

Farmers Union Calls Ability to Deliver Grain Shipments by Rail at Harvest ‘Substantially Inadequate’

Repost from National Farmers Union
[Editor: This media alert does not name the massive expansion of crude by rail shipments in the upper Midwest as the cause for lack of rail cars for shipping farm commodities, but there is little doubt this is the problem.  – RS]

August 6, 2014
Contact: David Thews, 202-554-1600,  dthews@nfudc.org
NFU Calls Ability to Deliver Grain Shipments by Rail at Harvest ‘Substantially Inadequate’
Warns Surface Transportation Board Farmers May Be Forced to Dump Grain

WASHINGTON (August 6, 2014) – National Farmers Union (NFU) President Roger Johnson warned the Surface Transportation Board (STB) that BNSF Railway (BNSF) and Canadian Pacific (CP)’s ability to deliver grain and ethanol at harvest are “substantially inadequate” and are resulting in farmers piling grain on the ground because of lack of transportation options.

“We are especially concerned regarding wheat, since harvest has already started and grain remains in the bin from last year’s harvest,” noted Johnson in a letter today to the STB chairman and vice chairman.  “While BNSF claims that the total number of late shipments of wheat has declined nationwide, 95.42 percent of all past due cars are concentrated in Montana, North Dakota, South Dakota and Minnesota. BNSF has promised to improve their performance, but we are still subject to delays and Average Train Speed at year-long lows,” the letter notes.

“Grain shipments in North Dakota are critical,” said Johnson.   BNSF reported in its latest weekly update that there have been 2,399 delayed rail cars with an average delay of 23.6 days. CP reported 22,457 open requests with an average of 11.71 weeks.   The letter cites anecdotal evidence from four different grain elevators indicating that their oldest orders are from early March and shuttle orders are up to 2,000 cars behind. “These numbers are staggering and simply unacceptable,” he said.

Johnson notes that in South Dakota, NFU members are hearing about significant delays directly from local grain elevators across the state. At one particular elevator that handles 15 million bushels of grain per year, 3 million of those bushels will not move before this year’s harvest.  “Due to the backlog, farmers are now dumping wheat on the ground because the elevators will not take on the increased liability,” he said.

Johnson also voiced his concern about the ethanol industry, which relies heavily on rail for transportation.  “While the June 20 decision rightfully addressed grain shipments, we encourage STB to consider shipments of ethanol as a priority as well,” he said.  “Failure to bring ethanol to market will hurt consumers because of higher gasoline prices, and will work against our efforts to offset imports of foreign oil.”

A full copy of the letter is here.

National Farmers Union has been working since 1902 to protect and enhance the economic well-being and quality of life for family farmers, ranchers and rural communities through advocating grassroots-driven policy positions adopted by its membership.

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