Tag Archives: State regulation

Bomb Trains, Crude By Rail, Federal deregulation, Keeping Watch on Earth News, Oil train derailment and explosion, Oil trains, Pipeline and Hazardous Materials Safety Administration (PHMSA), State regulation, Trump administration, Washington State

Trump admin’s stunning explanation for easing up on oil trains: Safety no excuse for “inhibiting market growth”

Safety Can’t Be a ‘Pretext’ for Regulating Unsafe Oil Trains, Says Trump Admin

Desmog, by Justin Mikulka, May 20, 2020
Lac-Megantic oil train explosion
Train burning in Lac-Mégantic, Quebec. Credit: Transportation Safety Board of Canada, CC BY-NC-ND 2.0

The federal agency overseeing the safe transport of hazardous materials released a stunning explanation of its May 11 decision striking down a Washington state effort to regulate trains carrying volatile oil within its borders. A state cannot use “safety as a pretext for inhibiting market growth,” wrote Paul J. Roberti, the chief counsel for the Pipeline and Hazardous Materials Safety Administration (PHMSA).

The statement appeared in the Trump administration’s justification for overruling Washington’s oil train regulation, which was challenged by crude-producing North Dakota and oil industry lobbying groups. The Washington rule seeks to limit oil vapor pressure unloaded from trains to less than 9 pounds per square inch (psi) in an attempt to reduce the likelihood that train derailments lead to the now-familiar fireballs and explosions accompanying trains transporting volatile oil.

Roberti wrote: “Proponents of the law insist Washington State has a legitimate public interest to protect its citizens from oil train fires and explosions, but in the context of the transportation of crude oil by rail, a State cannot use safety as a pretext for inhibiting market growth or instituting a de facto ban on crude oil by rail within its borders.”

With this statement, PHMSA is codifying what has been clear for some time at the regulatory agencies responsible for overseeing the transportation of hazardous materials by rail: that is, profits take priority over safety.

Rail Industry ‘Pre-emption’ and Safety Under Trump

A year ago, the U.S. Department of Transportation (DOT), PHMSA‘s parent agency, invoked the same legal argument, known as “pre-emption,” to overrule state efforts to require at minimum two-person crews for operating freight trains. As part of the explanation for that decision, the DOT‘s Federal Railroad Administration announced that it was adopting a policy of deregulation.

“DOT’s approach to achieving safety improvements begins with a focus on removing unnecessary barriers and issuing voluntary guidance, rather than regulations that could stifle innovation,” wrote the agency.

A regulatory agency announcing a broad deregulatory agenda was shocking. However, this latest move openly declares that, while Washington state may have an interest in protecting its citizens from “oil train fires and explosions,” that concern should not get in the way of the oil industry’s ability to ship more of its product by rail through the state, apparently even if that increases the risk of oil train fires and explosions to Washington residents. This logic reaches a new level of prioritizing profits over people as regulatory practice.


Historically, or at least, theoretically, government has based regulations on cost-benefit analyses, weighing the costs of complying for the regulated entities against the benefits, such as lives saved or accidents prevented, as a result of the new rules. Here, the DOT‘s new regulatory approach appears to weigh primarily the benefits for the rail and oil industries while downplaying the potential cost in human lives.

However, these industries did argue about costs to get to this point. As DeSmog has repeatedly documented, lowering the vapor pressure of oil below 9 psi is possible through a process called stabilization, which makes oil less volatile and less likely to ignite. Conditioning the oil in this way before loading on trains would require the oil industry to invest in stabilization equipment, which the industry has argued is not economically feasible.

In 2014, Myron Goforth, the president of Dew Point Control LLC, a manufacturer of stabilization equipment, put the situation in simple terms. “It’s very easy to stabilize the crude — it just takes money,” Goforth told Reuters. “The producer doesn’t want to pay for it if he can ship it without doing it.”

DOT‘s May 11 decision notes that “compliance with the [Washington] law can only be accomplished by (1) pretreating the crude oil prior to loading the tank car.” Exactly: Making the oil safe to ship on long, heavy trains through small towns and large cities requires stabilizing, or conditioning, before loading it into tank cars (just as the industry does before loading oil in pipelines or on ocean-going tankers, at least in Texas). DOT makes no argument about how companies could comply with the Washington law, outside of trying to avoid passing through the state entirely or using a different transportation mode other than trains.

A particularly telling clue behind the DOT‘s conclusion that the Washington law should be pre-empted is found in the commenters whose opinions the agency is highlighting: “In light of the infrastructure, equipment, and other logistical issues, the commenters have concluded that pretreating is economically infeasible or unrealistic.”

In this case, the “commenters” the DOT is referencing are members of the oil industry and its lobbyists, including the refinery company Hess Corporation, Marathon Petroleum, the American Petroleum Institute (API), American Fuel and Petrochemical Manufacturers, and the North Dakota Petroleum Council.

At an oil-by-rail conference in 2016, an API official described the industry’s attitude about the prospect of requiring oil stabilization for rail transport: “We in the oil and gas industry see this as a very dangerous conversation.”


In December 2017, Trump’s Federal Railroad Administration repealed an Obama-era rule requiring modern braking systems on oil trains despite overwhelming evidence that these systems improve rail safety. Sarah Feinberg, former head of the Federal Railroad Administration, offered important context about rail industry opposition to that rule.

“The science is there, the data is there,” Feinberg said of the efforts to require updated rail braking systems on oil trains. “Their argument is, despite that data, [they] don’t want to spend the money on it.”

That seems to be the rule for overseeing rail safety under the Trump administration. If a rule costs industry money to improve safety and protect the public from oil train fires and explosions, the industry will push back against its regulators, who appear to be pushovers, especially but not exclusively under Trump.

The alternative of prohibiting oil transportation by rail, because it is apparently too dangerous and too costly to do safely, is never even considered.

Ignoring the Science

The latest decision on the Washington state case continues a trend under Trump to overlook robust science when regulating oil by rail. However, you might not know it from the comments of this decision’s supporters.

PHMSA used a single, flawed study from Sandia National Laboratories to support its conclusion that limiting the vapor pressure of oil moved by rail is unnecessary — while the agency ignored all the other established research on vapor pressure, volatility, and ignitability of crude oil.

The North Dakota Congressional delegation opened its statement praising the May 11 decision with lip service to science: “We thank the administration for doing the right thing by putting sound, scientific evidence above partisan politics.”

In the same vein, Ron Ness, president of the North Dakota Petroleum Council, told the Associated Press, “There is nothing unusual about the volatility of Bakken crude oil,” a claim the North Dakota attorney general has also made to argue against the Washington vapor pressure law.

And yet these statements don’t stand up to scrutiny. In my book Bomb Trains: How Industry Greed and Regulatory Failure Put the Public at Risk, I present the evidence that Bakken crude oil’s volatility is higher than other regions and that this factor makes a difference. This crude oil is much more volatile than traditional crude oil from Louisiana or Texas, and that volatility, along with other factors, makes it more likely to ignite in oil train derailments.

WATCH: Justin Mikulka, Sept 2015: The Science of Bomb Trains

As I noted at the time of its publishing, the Sandia Labs study is deeply flawed and does not study the actual issue of oil igniting during train derailments.

As for whether Bakken oil’s volatility is “unusual,” a Wall Street Journal analysis found in 2014 that “Crude oil from North Dakota’s Bakken Shale formation contains several times the combustible gases as oil from elsewhere.” These combustible gases are what give the Bakken oil much higher vapor pressure levels than most other crude oils from the U.S.

The combustible gases in the oil are natural gas liquids like butane and propane, which is why the oil is so volatile.

At the same time that the oil industry tries to say Bakken oil isn’t more volatile than other oils, it argues that Bakken oil’s value lies in these extra natural gas liquids. Stabilizing the oil by removing these gases from the oil not only would cost the industry money but the resulting oil would be worth less to the industry.

The DOT notes as much in its recent decision: “These higher vapor pressure hazardous materials, such as butane, ethane, and other natural gases, are deemed essential and valuable components of Bakken crude.”

The oil industry has no argument to make on a scientific basis here, only an economic one. Reducing the vapor pressure of oil by removing gases like butane and ethane makes it less volatile and less likely to ignite. That is established by research. But the industry has repeatedly argued that removing these flammable gases from the oil would make it less valuable, which is one of its justifications for not stabilizing the oil.

A Second Bakken Bomb Train Boom Could Be on the Way

The only things that have kept the estimated 25 million North Americans living along railroad blast zones safer from dangerous oil trains is the success of activists who have blocked new oil-by-rail projects and oil industry economics. Because transporting oil by rail is more expensive than by pipeline or ocean-going tankers, the industry moves much less oil on trains when oil prices are low.


Oil train protesters in Albany, New York, in May 2016. Credit: Justin Mikulka

With current oil prices at record lows in the U.S. and Canada, it doesn’t make economic sense to move oil by rail, which is good news for the millions of people living along the rails.

However, a current legal battle over the Dakota Access pipeline could make moving Bakken oil by rail a major mode of transportation, perhaps regardless of oil price.

A judge recently set a hearing to review the permitting process for the controversial pipeline, currently moving 500,000 barrels of crude per day. Depending on the outcome, that hearing could result in the judge vacating the pipeline’s permits, shutting it down and diverting all of that Bakken oil back onto the rails in a big way, at levels that would surpass the records of 2014. The Obama administration passed oil train safety regulations in 2015 in response to the fiery accidents and oil spills that coincided with the boom in oil train traffic.

The Trump administration has steadily worked to roll back the modest progress of those safety rules, with the last one, on vapor pressure for oil by rail, withdrawn from the rulemaking process the very same day the DOT pre-empted Washington’s vapor pressure rule.

Now, an essentially unregulated oil-by-rail industry poses a real risk to public safety and the environment. With the Trump administration shooting down Washinton’s rule and repealing previous safety regulations, the risks of moving volatile oil by rail are essentially the same as in 2013. That was the same year a train hauling Bakken oil exploded in downtown Lac-Mégantic, Quebec, and killed 47 people.

Today, Bakken oil is just as volatile — and dangerous. The trains pulling upwards of a hundred cars of oil have the same outdated braking systems. Regulators have no requirements overseeing train track integrity or wear (the two latest oil train derailments and fires in Canada were likely because of track failures). There are no regulations on train length. And while rail companies have phased in a newer class of tank cars, those cars have ruptured in every major derailment involving oil and ethanol trains.

The accident in Lac-Mégantic happened almost seven years ago. An early Wall Street Journal article after the accident quoted an oil industry executive who said, “Crude oil doesn’t explode like that.”

Which is true in most cases. But Bakken crude does explode like that because it is full of gases like butane, is highly volatile, and has much higher vapor pressure than most other crude oils.

While that doesn’t have to be true, the Trump administration is taking steps to make sure it is.

Main image: Train burning in Lac-Mégantic, Quebec. Credit: Transportation Safety Board of Canada, CC BY–NC–ND 2.0

Bakken Crude, Crude By Rail, Derailment, Emergency Readiness & Response, Explosion, Hazardous cargo transparency, Rail industry lobby, Spill, State regulation, Tar sands crude

SACRAMENTO BEE: State seeks fee on dangerous chemicals crisscrossing California

Repost from the Sacramento Bee

State seeks fee on dangerous chemicals crisscrossing California

By Tony Bizjak, July 22, 2016 6:00AM

HIGHLIGHTS
• California officials say the state isn’t prepared to handle hazardous materials spills
• A new $45 fee on every rail car carrying dangerous substances will help beef up spill response

Day and night, trains crisscross California pulling long strings of tanker cars carrying volatile gas, chemicals and crude oil.

These shipments have long played a key role in powering the state economy, providing materials for medical supplies, computers and fertilizers, as well as fuels for vehicle fleets. But they also pose the risk of catastrophic spills.

Jolted by a series of oil train explosions nationally, including one in Oregon last month, the state this summer has drawn up a list of what it says are the 25 most hazardous materials shipped on rail in California. It plans to impose a new $45 fee later this year on every rail car carrying one of those materials. The money will be used to ramp up the state’s emergency spill and fire response capabilities.

The state Legislature ordered the fee program after a Governor’s Office of Emergency Services analysis that found significant gaps in California’s ability to deal with spills, especially in rural and remote areas.

The fee plan is disputed by the state’s major railroad companies who say they think it’s illegal.

The top 25 list includes materials that are dangerous to humans either by direct contact or because they are highly flammable. They include ammonia, chlorine, propane, butane, fertilizers, acids, petroleum gases and oils.

“When one of these trains derails, it puts lives, property and the economy at risk,” said State Fire and Rescue Chief Kim Zagaris. “And right now, we don’t have surge capacity to deal with a major spill.”

Because of the secrecy shrouding shipments of hazardous materials, it’s hard to know how big a risk they pose. State safety officials and private shippers refuse to disclose the amount, frequency, routes or timing of hazardous material shipments, citing federal safety regulations and state health and safety law restrictions, as well as concerns about terrorist or other criminal acts.

50  Approximate number of spills in the Roseville railyard in 2015

Even local fire departments typically don’t know in detail what materials are coming through, although they can get some after-the-fact information about hazardous materials that have traveled through their areas, if they request it.

Hazardous materials in train tanker cars can be identified, however, at least generically, by the identification numbers on diamond-shaped placards displayed on the sides of cars.

Trains observed by The Sacramento Bee in recent weeks in downtown and midtown Sacramento carried numerous hazardous materials, including liquefied petroleum gas, sulfuric acid and liquids designated hazardous at temperatures above 212 degrees Fahrenheit. A few trains were carrying either cleaning fluid, weed killing fluid, diesel fuel or other flammable liquids. Others were listed as holding unspecified petroleum distillates or petroleum products.

Shippers also have acknowledged transporting Bakken crude oil and Canadian tar sand oil through Sacramento neighborhoods.

California’s planned $45 per-train-car fee will pay for the creation of 12 specially trained hazmat teams to be spread out geographically near “gap” areas where there is a lack of expertise and equipment to deal with major spills, state Office of Emergency Services officials said.

Most will be in the lower Central Valley, on the coast and in Southern California. One hazmat team will be located in Yuba City, not far from the Feather River Canyon, where trains carrying hazardous materials travel the steep mountainside above a river that provides drinking water to urban areas as well as water for Central Valley farms.

Many larger fire departments already have specially trained hazmat teams. There are four in the Sacramento area, one each stationed in Roseville, Natomas, Carmichael and south Sacramento.

Railroad companies contend the proposed fee is illegal under federal law, which prohibits states from putting any constraints on interstate commerce via rail. Under the state plan, the companies that own the hazardous materials must pay the fee, but railroad companies must collect the fee from them and convey it to the state.

The Union Pacific and BNSF – the two main hazardous materials shippers in California – sent letters to the state last month saying the fee interferes in the railroads’ business dealings with their shipper customers and demanding the state desist.

“These emergency regulations violate federal law; therefore, (California) must abandon the process of adoption,” UP assistant vice president Phillip Christensen wrote. “No state can regulate the rates or charges a railroad collects from its customers. This kind of ‘economic regulation’ is categorically prohibited” by federal interstate commerce law.

UP officials declined to be interviewed for the story. The company sent The Bee an email saying that safety is the railroad’s primary focus when transporting hazardous materials. The email did not say whether the railroad might sue the state to stop the fee.

The American Chemistry Council, which represents hazmat shippers, said its members are concerned that California’s actions could lead to dozens of states imposing rail fees, creating what chemistry council spokesman Scott Jensen calls a confusing “patchwork” of regulations without certainty about how the money would be spent, beyond creation of some hazmat teams.

Dow Chemical regulatory affairs official Dale Backlund said his company would like the state to meet more with the industry to talk about the best approach to conducting emergency response training. “Can we slow down the train and think through the implications of this?” he said.

NO STATE CAN REGULATE THE RATES OR CHARGES A RAILROAD COLLECTS FROM ITS CUSTOMERS. Union Pacific’s Phillip Christensen

Despite such complaints, state Office of Emergency Services officials say they plan to impose the fee later this year, although they expect to continue talking with the railroad companies and shippers about fine-tuning the fee program.

“It is law now,” Zagaris said. “We are following the law.”

The state plans to collect up to $10 million annually from hazardous materials shippers, to be placed in the Regional Railroad Accident Preparedness and Immediate Response Fund. The fund will be capped at $20 million.

Although hazardous materials also are shipped on highways, the fee is being applied only to rail shipments, mainly because the threat of a major spill incident is greater on rail, Zagaris said.

“It is a bigger item for us to deal with, takes a larger response, more surge capacity and it puts the public and environment at more risk,” he said. “That’s not to say, at some point, (the state) won’t come back and try to ID things transported on the road.”

Railroads and hazardous materials shippers argue that the risks of oil and hazmat spills are being overplayed by anti-oil advocates and some community leaders. Very few trains derail, they note, and most hazardous material spills are small. A crude oil train crash in a Canadian town three years ago, though, unleashed a firestorm that killed 47 people, some in their sleep.

A Bee review of the state’s rail spill database found that hundreds of hazardous material spills occur annually. The database represents an incomplete listing, based only on initial reports, not on post-response findings. But it does offer a glimpse at the many types of hazardous materials that run on local rails.

Most spills are small and many happen in railyards around the state, such as the Union Pacific yard in Roseville. There were about 50 reported spills in the Roseville yard in 2015. The largest local spill that year, as initially reported, was 300 gallons of diesel fuel that leaked due to an improperly closed locomotive fuel filter cap. Other small spills around the Roseville yard in 2015 involved butane, oil, liquid petroleum gas, anhydrous ammonia, picoline and sodium sulfide.

Larger spills, though rare, can be devastating to wildlife and rural economies. The most notorious modern rail-related toxic spill in California occurred 25 years ago when a train derailed and spilled 19,000 gallons of the pesticide metam sodium into the Sacramento River near Dunsmuir, killing aquatic life on a 40-mile stretch of the river for years. Rail safety improvements have since been made at a tight rail curve at that spill site.

In Sacramento, several dozen trains cross daily in downtown Sacramento on two main freight lines. A Bee review of trains on those tracks recently found that more than half of the trains included at least a few cars carrying hazardous materials.

One freight line is a north-south route that comes through the region between Yuba City and Stockton and passes through midtown Sacramento between 19th and 20th streets. The other is an east-west route that runs through Roseville and on a berm above downtown Sacramento, through the downtown railyard and through Davis, adjacent to downtown and the university campus.

Sacramento City Fire Department hazardous materials coordinator Jerry Apodaca said the Sacramento region, with four hazmat teams, is well positioned to deal with a potential spill. But he and other local fire officials say they remain on alert, not knowing on any given day what shipments are coming through or when.

“We don’t know what’s in those cars until we get there,” he said.

CALIFORNIA’S LIST

The state wants to impose a $45 fee on rail cars that transport the 25 materials the state considers most hazardous. The list, with the hazard identification number of the materials:

  • Acetonitrile 1648
  • Alcohols 1987
  • Ammonia, anhydrous 1005
  • Ammonium hydroxide/ ammonia solutions 2073, 2672, 3318
  • Calcium hypochlorite 1748, 2208, 2880, 3485, 3486, 3487
  • Chlorine 1017
  • Corrosive liquid, basic, inorganic 3266
  • Diesel fuel/fuel oil/gas oil 1202, 1993
  • Environmentally hazardous substances, liquid 3082
  • Ethanol/ethyl alcohol 1170
  • Gasoline; when shipped as flammable liquid 1203, 1993, 3295
  • Hydrogen peroxide 2014, 2015, 2984, 3149
  • Liquefied petroleum gas 1075, 3161
  • Methanol/methyl alcohol 1230
  • Methyl ethyl ketone 1193
  • Nitric acid 2031, 2032
  • Petroleum crude oil 1267, 1270
  • Phenol 1671, 2312, 2821
  • Phosphoric acid 1805, 3453
  • Potassium hydroxide/caustic potash 1813, 1814
  • Propylene 1075, 1077, 3138
  • Sodium hydroxide/caustic soda 1823, 1824, 3320
  • Sulfuric acid 1830, 1831, 1832, 2796
  • Toluene 1294
  • Vinyl acetate 1301

Source: California Office of Emergency Services

 

Crude By Rail, Derailment, DOT-111, Earthjustice, Explosion, Federal Regulation (U.S.), Local Regulation, Rail accidents, State regulation

Earthjustice map: Crude-by-rail Across America

Repost from Earthjustice.org
[Editor: I’m reposting this map today – it was recently updated and still highly relevant.  Earthjustice’s map shows Major Crude-by-Rail Accidents since 2012 (Red Symbols) and communities opposing Crude-by-Rail (Green Symbols).  – RS]

More crude oil was spilled in U.S. rail incidents in 2013, than was spilled in the nearly four decades since the federal government began collecting data on such spills.

Since late 2012, as hydraulic fracturing and tar sands drilling created a glut of oil, the industry has scrambled to transport the fossil fuel from drill sites to the east and west coasts, where it can potentially be shipped overseas to more lucrative markets.

The increase in oil rail traffic, however, has not been matched with increased regulatory scrutiny. Oil trains are not subject to the same strict routing requirements placed on other hazardous materials; trains carrying explosive crude are permitted to pass directly through cities—with tragic results. A train carrying Bakken crude oil derailed in the Quebec town of Lac-Mégantic on July 6, 2013, killing 47 people in the small community.

In the absence of more protective regulations, communities across the country are beginning to take matters in their own hands.

Legal Cases

Earthjustice represents groups across the country, fighting for protections from crude-by-rail:

FAQs: About Crude-By-Rail

Q. What are DOT-111s?

DOT-111s are rail cars designed to carry liquids, including crude oil, and have been in service in North America for several decades. They are prone to punctures, oil spills, fires and explosions and lack safety features required for shipping other poisonous and toxic liquids. As crude production in the United States has surged exponentially in recent years, these outdated rail cars have been used to transport the crude oil throughout the country.

The U.S. and Canadian government recognized decades ago that the DOT-111s were unsafe for carrying hazardous materials, finding that the chance of a “breach” (i.e., loss of contents, potentially leading to an explosion) is over 50% in some derailment scenarios.

U.S. and Canadian safety investigators have repeatedly found that DOT-111s are unsafe and recommended that they not be used for explosive or hazardous materials, including crude oil; however, the U.S. government’s proposal to phase out these rail cars fails to take sufficient or immediate action to protect the public.

Q. What is Bakken crude oil?

Bakken crude refers to oil from the Bakken shale formation which is primarily in North Dakota, where production has skyrocketed in recent years due to the availability of newer hydraulic fracturing (“fracking”) techniques. The increase in the nation’s output of crude oil in 2013, mostly attributable to Bakken production, was the largest in the nation’s history.

Bakken crude is highly flammable, much more so than some crude oils. Today, Bakken crude moves in “unit trains” of up to 120 rail cars, as long as a mile and a half, often made up of unsafe DOT-111s.

Q. Are there alternative tank cars available?

Transporting Bakken crude by rail is risky under the best of scenarios because of its flammability. But legacy DOT-111s represent the worst possible option. All new tank cars built since October 2011 have additional some safety features that reduce the risk of spilled oil by 75%. Even so, safety investigators, the Department of Transportation, and the railroad industry believe tank cars need to be made even safer. Some companies are already producing the next-generation rail cars that are 85% more crashworthy than the DOT 111s. Petitioners support the safest alternatives available, and expect that the ongoing rulemaking process will phase out all unsafe cars.

In the meantime, an emergency prohibition on shipping Bakken crude in DOT-111s—which virtually everyone acknowledges is unreasonably dangerous—is required immediately. (Read about the formal legal petition filed on July 15, 2014.)

Q. What steps have U.S. and Canadian governments taken?

The U.S. government recognizes that Bakken crude oil should not be shipped in DOT 111 tank cars due to the risks, but has done shockingly little to limit their use.

In May 2014, the DOT issued a safety alert recommending—but not requiring—shippers to use the safest tank cars in their fleets for shipments of Bakken crude and to avoid using DOT 111 cars. Canada, in contrast, responded to the Lac Mégantic disaster with more robust action. It required the immediate phase-out of some DOT-111s, a longer phase-out of the remainder, and the railroads imposed a surcharge on their use to ship crude oil in the meantime.

In the absence of similar standards in the U.S., the inevitable result will be that newer, safer cars will be used to ship crude in Canada—while the U.S. fleet will end up with the most dangerous tank cars.

Crude By Rail, Oil spill, Risk Assessment, State regulation

Washington regulator unaware of oil train consultant’s connections

Repost from The Oregonian / OregonLive
[Editor:  The consultant’s connections with BNSF were noted nearly a month ago here and in Curtis Tate’s McClatchy DC report.  On November 24 Tate wrote, “The rail spill analysis portion of the Washington state draft document was written in part by three consultants who are former employees of BNSF and its predecessor, Burlington Northern. In addition to the state agency for which they prepared the analysis, their clients include BNSF and the Port of Vancouver.”  I  understand that the Washington agency that hired the consultant, the Energy Facility Site Evaluation Council, was asked about the possible conflict of interest in advance of publication of Tate’s article, but they never got back to him.  Staff at the Energy Facility Site Evaluation Council should have been aware well in advance of the Oregonian story.  – RS]

Washington regulator unaware of oil train consultant’s connections

By Rob Davis, Dec. 17, 2015, updated Dec.18, 2015 9:44 AM
vancouver oil train
An oil train parked outside Vancouver, Wash., in 2014. A terminal proposed there would bring four oil trains to the city each day. (Rob Davis/Staff)

A consulting firm that helped write a report underestimating the risks of catastrophic spills from a proposed Vancouver oil train terminal has worked for two groups that will gain financially if the project moves forward.

Stephen Posner, the Washington energy regulator who approved the company’s hiring, didn’t know about all those connections until The Oregonian/OregonLive told him. But he did not answer repeated questions about whether he would investigate further.

Three of the four authors who wrote the risk analysis for Washington’s Energy Facility Site Evaluation Council are former executives of BNSF Railway Co. The railroad would move oil trains to the Vancouver terminal.

The authors’ company, MainLine Management, lists BNSF as a client on its website.

MainLine, which didn’t respond to repeated queries, recently worked for another project supporter: the Port of Vancouver, which owns the land where the terminal would be built.

Much remains unclear about MainLine’s relationships with BNSF and the port. It is not known whether BNSF is a current MainLine client. It’s also unclear whether MainLine’s past work for the port would constitute a conflict.

Washington law prohibits the energy council from hiring consultants with a significant conflict of interest with a project’s applicant or others involved.

MainLine finished its work for the port before it was hired to analyze the terminal. The port awarded a $121,000 contract to MainLine in April 2013 to analyze part of its freight rail system serving the oil train terminal. A port spokeswoman said the final payment was sent to MainLine Sept. 25, 2014, four months before the firm was hired to analyze oil spill risks.

The relationships raise questions about the thoroughness of Washington’s review of the experts it’s using to independently evaluate the Vancouver oil terminal.

The $210 million terminal proposed by Tesoro Corp. and Savage Services is the highest profile project pending before the Washington energy council.

The small agency is designed to be a one-stop permitting shop for major energy projects, studying their impacts and recommending a decision to Gov. Jay Inslee. The governor has final approval.

Posner, the agency’s manager, approved hiring MainLine. He said he was unaware the firm listed BNSF as a client until The Oregonian/OregonLive told him.

But neither Posner nor an agency spokeswoman, Amanda Maxwell, would commit to inquiring further about whether the company has a current connection with BNSF.

Before MainLine was hired, Posner said he discussed the company with Washington’s lead consultant, Cardno. He said his agency relied on Cardno to vet MainLine’s clients and past work.

How did Cardno review MainLine’s potential conflicts? That’s unclear. Posner told The Oregonian/OregonLive to direct that question to Cardno, which didn’t immediately respond.

Cardno has provided written assurance that its subcontractors, including MainLine, are forbidden to discuss the terminal with any outside party, Maxwell said.

“This written assurance provided by Cardno is the basis for trusting in the credibility of the work being performed,” she said.

When we asked Posner whether he was concerned that MainLine could have a conflict, the spokeswoman, Maxwell, interrupted, saying it was inappropriate for him to comment.

“Without having the information, it’s not something he could put in context,” she said.

The agency should have that knowledge and be able to answer such a question, said Robert Stern, a good government advocate who helped write California’s post-Watergate conflict of interest law. He said the energy agency’s review appeared inadequate.

“Maybe they don’t have any conflicts, but how do you know?” Stern said. “There should be something in writing saying we have no conflicts of interest.”

Both BNSF and the Port of Vancouver stand to benefit financially from the project’s construction. The port estimates netting $45 million in lease revenue from the project over 10 years. BNSF has rallied supporters to send comments to the energy council praising the project, saying its construction would strengthen the rail company’s customer base.

Gus Melonas, a BNSF spokesman, didn’t specifically answer a question about whether MainLine is currently under contract with the railroad.

“BNSF does not discuss specific relationships involving contract companies,” Melonas said by email, “however MainLine Management Inc. has worked with Northwest agencies providing modeling on rail related projects.”

If built, the Vancouver project would be the Pacific Northwest’s largest oil train terminal, capable of unloading 15 million gallons of oil from four trains daily. The oil would be put on barges and sent to coastal refineries.

It has drawn strong opposition from Vancouver elected officials and environmental groups amidst a string of fiery oil train explosions nationwide since 2013.

The report co-authored by MainLine lowballed those risks. It called a 2013 oil train spill in Aliceville, Alabama the worst on record, using it to analyze impacts of a disaster in the Pacific Northwest. The study said a slightly larger spill is “the most credible or realistic” worst-case scenario.

But a far larger spill has already happened. An out-of-control oil train derailed and exploded in Quebec in July 2013, fueling a raging inferno that killed 47 people and leveled part of a small Canadian town.

The analysis incorrectly said the Quebec accident spilled just 36,000 gallons of crude. Far more did. Canadian safety regulators concluded 1.5 million gallons escaped from tank cars. Much of it burned in the resulting fire.

Just a third as much oil spilled in the Alabama accident.