Tag Archives: Washington

Bakken Crude, Crude By Rail, Oil stabilization, Volatile gases

North Dakota man relentless in push for safer oil by rail shipping

Repost from the Billings Gazette
[Editor: This is not a fluffy human interest story, but an important offering on the oil industry and regulators in North Dakota. Significant quote: “‘If you want to fix a problem, you go to the source of the problem,’ he said.  ‘You don’t prepare for something that doesn’t have to happen.’”  Another good quote: “Pressure to make North Dakota crude oil safe for interstate shipment is mounting on several fronts.”– RS]

North Dakota man relentless in push for safer oil by rail shipping

November 02, 2014, by Patrick Springer, Forum News Service
Ron Schalow of Fargo
Ron Schalow of Fargo has been an outspoken advocate of stabilizing Bakken oil to remove volatile gases before it is shipped by rail. | David Samson / Forum News Service

FARGO, N.D. — Ron Schalow isn’t bashful about expressing his caustic opinions. He once wrote a book scolding President George W. Bush for failing to prevent the 9/11 terrorist attacks.

Part of the title can’t be printed here, but the subtitle read, “The 9/11 Leadership Myth.”

More recently, the Fargo man, a frequent writer of letters to the editor, has focused his attention on explosive Bakken crude oil and rail safety – an issue that has drawn national attention after a series of fiery train derailments, including an accident that killed 47 people in Canada and one late last year near Casselton.

Schalow launched a petition drive originally called the “Bomb Train Buck Stops in North Dakota,” which he renamed the “Coalition for Bakken Crude Oil Stabilization,” a reference to the process for removing volatile gases.

Improbable activist

Schalow’s background makes him an improbable activist. His early career was spent managing restaurants and bars, with a stint as a minor league baseball manager.

More recently, he worked for software companies including Microsoft in Fargo, but said he grew weary of corporate culture and office politics and turned to freelance work.

He has assembled a loose network of people concerned about the crude oil stabilization issue, including local officials in Minnesota and other states, but laments he has found little support for his crusade in North Dakota.

Still, North Dakota leaders have been under pressure from the federal government and other states, including Minnesota, to treat crude oil before shipping it around the country by rail to refineries.

The North Dakota Industrial Commission is preparing new standards, likely to take effect Jan. 1, to “condition” crude oil before transport to address safety concerns. Separately, federal officials are drafting more stringent safety standards for tanker cars.

“I think we have to take some responsibility over what’s going over the tracks into Minnesota and the rest of the country,” Schalow said. “It has a lot to do with this is a product that’s coming out of my state.”

By his own admission, 59-year-old Schalow is not a consensus builder. A freelance writer for marketing clients, he isn’t a joiner by nature. Bespectacled, with a goatee, he is soft-spoken but adamant in expressing his views.

He has peppered North Dakota officials, including petroleum regulators and the three-member Industrial Commission, with emails calling for action and asking who is in charge of what he sees as a vital issue of public safety.

“I’ve badgered them relentlessly,” he said.

He is dismayed by what he regards as a sluggish state response, even after an official “tabletop exercise” last June that estimated 60 or more casualties if an oil train derailed and exploded in Fargo or Bismarck.

The exercise simulated a disaster similar to the blast that killed 47 and destroyed much of the town of Lac-Mégantic, Quebec, in July 2013.

For Schalow, the key to ensuring the oil is safe is to remove the volatile gases before shipping. Anything else, in his view, is passing along a potentially deadly problem for others to face.

“If you want to fix a problem, you go to the source of the problem,” he said. “You don’t prepare for something that doesn’t have to happen.”

Derailments costly

Dealing with an explosive derailment can be costly. New York officials estimated, for example, it would take $40,000 in foam to extinguish one tanker car.

In the rail accident near Casselton last December, 20 tanker cars derailed, 18 of which were breached, unleashing a series of explosions and an enormous fireball. Intense heat kept the firefighters far from the flames, which they had to allow to burn out.

No one was seriously injured or killed in the crash.

“They can’t be prepared for combat explosions,” Schalow said, referring to the explosive fires that Bakken crude derailments have produced. “What would they do?”

North Dakota officials in the governor’s office and Department of Mineral Resources declined to talk about Schalow’s advocacy, but said the state is moving ahead to improve the safety of crude oil transportation.

“Gov. (Jack) Dalrymple takes rail transportation safety very seriously and he believes it’s important to have the public weigh in on this important issue,” said Jeff Zent, a spokesman and policy aide for the governor, the highest-ranking member of the Industrial Commission.

“That’s why the Industrial Commission will announce further regulations aimed at improving the safety of oil rail transportation,” he added.

“Our goal has always been to make crude oil as safe as possible for transport, within our jurisdiction,” said Alison Ritter, a spokeswoman for the North Dakota Department of Mineral Resources, which regulates oil and gas production.

The department is also working with “the appropriate federal agencies to better communicate our role to make crude oil as safe as possible for transport,” Ritter said.

In contrast to North Dakota, most crude oil in Texas is stabilized before shipment. Pipeline companies routinely require stabilization before accepting shale oil.

“How hard is it to stand up and say I’m against trains blowing up in my town?” Schalow asked, referring to public officials’ initial reluctance to impose tougher standards.

A recent Forum Communications poll found that 60 percent of respondents were concerned about the safety of shipping crude oil by rail, but there has been no real clamor from residents, Schalow said.

“It’d be nice if someone stood up and defended me once or twice,” he said. As for holding a meeting of supporters, well, “Who would I call and who would dare show up? There’s no political will in this state except for that anonymous 60 percent.”

In Minnesota, Gov. Mark Dayton has urged North Dakota to stabilize oil before loading crude onto trains. An estimated 50 North Dakota oil trains roll through Minnesota each week, many with 100 tanker cars.

Pressure to make North Dakota crude oil safe for interstate shipment is mounting on several fronts.

Other states, including New York and California, where refineries take Bakken crude, are considering safety requirements.

“There’s a lot more angst across the country than there is here,” Schalow said, adding that most of his contacts are from other states, including New York, California and Washington state.

“I think he’s a pretty straight shooter,” said Tim Meehl, mayor of Perham, Minn., who is concerned about oil trains traveling through his town. “I think everything he says has a lot of merit to it.”

Meehl has not met Schalow, but saw him at a meeting in Moorhead earlier this fall attended by Dayton and local officials, and has exchanged emails with Schalow.

“They don’t want to step on toes out there,” Meehl, a native of Oakes, N.D., said of North Dakota officials’ deference to oil interests. “We need the oil. We just need to do it in a safer way.”

In North Dakota, residents and politicians seem reluctant to do anything that risks discouraging energy production, a powerful economic engine, Schalow said.

‘Quiet acceptance’

“You can’t say anything that might impact business, no matter what,” he said, describing what he regards as North Dakota’s curious culture of quiet acceptance.

Regulators aren’t alone in singling out oil tanker cars. BNSF announced last week that it will charge a $1,000 fee for each older crude oil tank car, more prone to puncture than newer models. By one estimate, that would add about $1.50 a barrel to the transportation cost.

In Texas, energy companies have invested hundreds of millions of dollars to make crude safer to handle. The cost of stabilizing crude oil could trim potential revenue by perhaps 2 percent, according to the estimate of an unidentified industry executive interviewed by The Wall Street Journal.

Schalow has been an outspoken critic of the Bush presidency and North Dakota leadership, but said he really has no allies in either political party.

A conservative blogger once described him as a “truther” for his criticisms of Bush, whom he castigated for failing to take pre-emptive action against al-Qaida despite warning signs of their terrorist ambitions. Schalow dismisses the “truther” label as unfair, saying he offered no conspiracy theories in his book.

He said the paperback sold 4,000 or 5,000 copies after it came out in 2006. No book is forthcoming on the issue of Bakken crude safety, but Schalow is unlikely to stop writing his letters, emails and Facebook posts.

“I don’t think it’s a political issue,” he said. “I think it’s a public safety issue.”

Bakken Crude, Crude By Rail, Marine transport, Monterey Shale, Pacific Northwest

Reuters Exclusive: California getting more Bakken crude by barge than rail

Repost from Reuters
[Editor:  At the 9/11/14 Benicia Planning Commission meeting, John Hill, vice president and general manager of the Valero Benicia Refinery, stated that Bakken crude has been refined at Valero.  Commissioner Steve Young asked Hill to confirm his statement, which he did.  Young then asked the means of transport, and Hill replied “by barge.”  Our communities might well ask when, how much, and with what new volatile emissions output, etc….  – RS]

Exclusive: California getting more Bakken crude by barge than rail

By Rory Carroll, SAN FRANCISCO, Oct 23, 2014
A pumpjack brings oil to the surface in the Monterey Shale, California, April 29, 2013. REUTERS/Lucy Nicholson
A pumpjack brings oil to the surface in the Monterey Shale, California, April 29, 2013. REUTERS/Lucy Nicholson

(Reuters) – Shipments of Bakken crude oil from North Dakota to California by barge have quietly overtaken those by train for the first time, showing how the state’s isolated refiners are using any means necessary to tap into the nation’s shale oil boom.

While tough permitting rules and growing resistance by environmentalists have slowed efforts to build new rail terminals within California itself, a little-known barge port in Oregon has been steadily ramping up shipments to the state, a flow expected to accelerate next year.

From January through June, California received 940,500 barrels of the North Dakota crude oil from barges loaded at terminals in the Pacific Northwest, the highest rate ever, Gordon Schrempf, senior fuels analyst for the California Energy Commission, told Reuters.

Bakken crude transported to California on railcars, which has gained widespread attention after a series of fiery train derailments in North America, accounted for just 702,135 barrels over the same time period, according to published figures.

“We’re seeing marine transport of Bakken crude outpace rail for the first time,” Schrempf said. In 2013, rail shipments of 1.35 million barrels exceeded barge shipments of 1.33 million barrels. The year before, almost no crude arrived by barge.

Bakken shipments by barge and rail may only comprise a tiny portion of the crude California imports, at about 5,200 and 4,000 barrels per day respectively, with Alaska supplying over 20 times as much crude.

But companies, including refiner Tesoro Corp and logistics company NuStar Energy LP, have plans to significantly expand that volume with new terminals along the Pacific Northwest that would unload trains from North Dakota and pump the oil onto tankers.

They would help make California a major destination for Bakken oil, a trend that has drawn objections from environmental groups who have been seeking to stem the tide, often by blocking local permits to built oil-train offloading terminals.

“Bringing it in by barge gets you around cumbersome permitting and the growing citizen opposition to crude-by-rail,” said Lorne Stockman, research director of Oil Change International, a research and advocacy organization working on energy, climate and environmental issues.

To be sure, their objections may differ. The principle concern over transporting Bakken by rail is the risk that a derailment could cause a deadly explosion similar to the one in Lac Megantic, Quebec, last year that killed 47 people.

There is no suggestion that waterborne oil transportation poses similar explosive risks, although the environmental impact of a barge spill could be much greater.

“The barges are designed to carry the grade of oil that the Bakken is,” said Ted Mar, prevention branch chief for the state’s Office of Spill Prevention and Response and a former member of the Coast Guard.

That is small comfort to environmentalists, who oppose all forms of oil production, in particular shale crudes like Bakken, extracted through hydraulic fracking they fear contributes to global warming and poses a potential risk to water supplies.

“Our end goal is to leave these more dangerous, unconventional fuels in the ground,” said Jess Dervin-Ackerman, conservation manager for the San Francisco Bay Chapter of the Sierra Club.

SMALLER BUT CLOSER

With state production declining since the mid-80s, California’s refiners have increasingly relied on deliveries of crude by oceangoing tankers carrying 500,000 barrels or more from places like Alaska, Saudi Arabia, Ecuador and Iraq, which supplied two-thirds of their needs last year.

The refiners have been scrambling for several years to get better access to cheaper domestic shale oil by any means necessary, replacing costlier imports. But with the big shale fields to the east of the Rocky Mountains and a lack of major pipelines, it has not been easy.

The articulated tug barges (ATBs) now arriving are tiny by comparison to the tankers, carrying as little as 50,000 barrels.

Such shipments cost more than bringing Bakken directly to California by rail, but easily plug into existing port and terminal infrastructure – avoiding the need for new permitting that can take years.

While many are working to build out their own rail facilities, a handful of major rail-to-barge terminals along the Pacific Northwest coast that would ship over 500,000 bpd of Bakken crude have been in the works for several years. But most are incomplete, and several face delays.

One of the few exceptions is an idled ethanol terminal and processing plant in Clatskanie, Oregon, run by Global Partners LP. The facility, on a small canal that feeds into the Columbia River, began quietly transshipping oil from trains to barges in 2012 and is now receiving so-called “unit trains”, mile-long trains that only carry crude oil.

“Unit train volume into our Clatskanie terminal is up, and interest in the facility from prospective customers is at an all-time high,” Global Partners Chief Executive Eric Slifka said in August.

Global Partners did not respond to a request for comment.

Later that month, the firm received a new air permit from the Oregon Department of Environmental Quality that will allow it to ship as much as 1.84 billion gallons of volatile liquids, or some 120,000 bpd. It did not specify crude or ethanol.

Much of those shipments moved north to refineries in Washington, including BP’s Cherry Point in Puget Sound, and Phillips 66’s Ferndale facility. But both those plants are expanding their own facilities to bring more Bakken in by rail, likely curbing some demand for barges.

Top oil barge operator Kirby Corp, which runs vessels out of Clatskanie, is currently building two larger 185,000-barrel barges to deploy on the coast next autumn.

Environmentalists say they are monitoring the rise in Bakken-by-barge deliveries.

“This won’t pull our focus away from crude by rail, but rather expand the lens with which we look at dangers of Bakken entering our communities,” said the Sierra Club’s Dervin-Ackerman.

(Reporting by Rory Carroll, editing by Jonathan Leff and Marguerita Choy)
Bakken Crude, Crude By Rail, Rail inspection, Union Pacific Railroad

Union Pacific boosts rail inspections in high-hazard mountain passes

Repost from The Sacramento Bee
[Editor: See video of reporter Tony Bizjak’s ride on the inspection car here.  – RS]

Union Pacific boosts rail inspections in high-hazard mountain passes

By Tony Bizjak, 10/19/2014
Mike Stoddard oversees the operation of Union Pacific Railroad’s EC-4 as it makes its way out of the Roseville yard on Oct. 6 in Roseville. The EC-4 is a 96-ton, 82-foot-long rolling track inspection car which travels 800-1500 miles a week making sure that heavily used railroad tracks are in good working order.
Mike Stoddard oversees the operation of Union Pacific Railroad’s EC-4 as it makes its way out of the Roseville yard on Oct. 6 in Roseville. The EC-4 is a 96-ton, 82-foot-long rolling track inspection car which travels 800-1500 miles a week making sure that heavily used railroad tracks are in good working order. Randy Pench

Faced with public concern about the risks of crude oil shipments, the Union Pacific railroad last month boosted its rail inspection program on mountain passes in California and the West, dispatching high-tech vehicles with lasers to check tracks for imperfections.

UP officials say they have leased two rail inspection vehicles, called geometry cars, doubling the number of computer-based safety cars in use on the company’s tracks. The move comes amid mounting public concern about hazardous-material shipments, including a growing quantity of highly flammable crude oil from North Dakota being shipped to West Coast refineries.

The inspection cars will supplement similar geometry cars UP owns that it uses to inspect hundreds of miles of tracks daily on the company’s main lines west of the Mississippi River. Running at regular train speeds, the inspection vehicles can detect tiny deviations and wear on rail lines that could cause a derailment if allowed to grow, UP officials said.

The new cars will patrol the main mountain routes into the state, UP officials said. Northern California sites will include Donner Pass, the Feather River Canyon and grades outside Dunsmuir. The state has designated all those areas high hazards for derailments.

In Southern California, the inspection vehicles will patrol UP’s looping line over the Tehachapi Mountains, as well as the line on the Cuesta grade in San Luis Obispo County. The trains also will check mountain rails in Washington, Oregon, Utah and Nevada.

“We’re ensuring we keep crude oil trains on the track,” said David Wickersham, UP’s chief maintenance engineer in the West. “We are going to time it so we are hitting California every three months.”

State rail safety chief Paul King of the California Public Utilities Commission applauded the move. “It’s easy to maintain a straight (flat) railroad, but it’s not as easy to maintain a curved rail like you find in the mountains,” King said.

Grady Cothen, a retired Federal Railroad Administration safety official, said the type of high-tech inspections cars UP is using have become a must for major railroad companies. With more freight moving through limited rail corridors, especially mountains, the financial and political implications of a major derailment that causes damage are huge for railroads.

Bakken Crude, Derailment, Disclosure of tank car contents, Explosion, Hazardous cargo transparency, Hazmat notification, Pacific Northwest

Report shows increase in Central Oregon oil trains

Repost from The Bulletin (Serving Central Oregon)
[Editor: Significant quote: “The company’s (BNSF) most recent report shows a change in data format.  In the first two reports, BNSF reported the actual number of trains passing through Central Oregon during a specific week. While the new report still focuses on a specific week, the company is now giving a estimated number of oil trains.”  – RS]

Report shows increase in Central Oregon oil trains

BNSF: 100-car Bakken trains passing through Bend

By Dylan J. Darling / The Bulletin / Oct 14, 2014 

While a state-released report by BNSF Railway about the number of large Bakken crude oil trains passing through Central Oregon shows a potential notable increase, a company spokesman said Monday the actual number of trains is less than detailed in the report.

Following relatively new federal rules about reporting oil trains, BNSF Railway Co . sent a Sept. 30 report to the Oregon Office of the State Fire Marshal showing that an estimated zero to three oil trains carrying more than 1 million gallons of crude oil each pass through Deschutes and Jefferson counties per week.

A report earlier this year showed one such train passed through Central Oregon weekly.

“The real number is one every 12 days,” said Gus Melonas, spokesman for BNSF. That works out to three or four of the trains per month going through Redmond, Bend and beyond. He said the trains are carrying the oil to refineries in California.

The trains going through Central Oregon and the Columbia River carry crude oil from the Bakken region of North Dakota, oil that has proved to be more volatile than other crude oil. Bakken oil train derailments have led to dramatic explosions in Canada and North Dakota. Last May, the U.S. Department of Transportation issued an emergency order requiring railroads to provide information to state emergency responders about large train shipments of Bakken oil.

The BNSF rail route through the Gorge, bringing crude oil to refineries near Portland and in Washington, sees two to three oil trains per day, Melonas said. He said the route through Bend is “not a high volume line.”

The reporting rules pertain to trains carrying 1 million or more gallons of crude oil, the equivalent of about a 35-car train.

“If they have a train carrying less than a million crude, they don’t have to report it at all,” Rich Hoover, community liaison for the Office of State Fire Marshal, said Monday.

Melonas declined to give details on whether there are trains carrying less than a million gallons of crude oil rolling through Central Oregon, citing security and customer information concerns. If there were, he said, the oil cars would be hauled with cars carrying other commodities.

“We don’t put out specifics,” he said.

Each time a railroad company has an increase or decrease of 25 percent or more in the number of trains passing through an area, the rules require it to send a report to the state. Since May, BNSF has sent three reports to Oregon.

The company’s most recent report shows a change in data format. In the first two reports, BNSF reported the actual number of trains passing through Central Oregon during a specific week. While the new report still focuses on a specific week, the company is now giving a estimated number of oil trains.

Hoover said the state goes by what the company states in its reports , which the Office of State Fire Marshal posts to its website.

“What you see and read is exactly how much we know,” he said.

Melonas described the trains traveling through the region as “unit trains,” meaning they haul one commodity, and each train has about 100 tanker cars. The trains hold 70,000 to 80,000 barrels of crude oil each, or about 2.94 million to 3.36 million gallons of crude oil.

Concerned about the possible catastrophic results of an oil train derailment, Sally Russell, Bend city councilor, said it is a good thing the railroad is having to supply information to the state.

“Knowledge and the ability to response and react are critical,” she said.

If the number of large oil trains passing through Central Oregon is going up, it means the potential for a situation necessitating an emergency response is increasing, Bill Boos, deputy chief of fire operations for the Bend Fire Department, said Monday.

He said he’d like to have information on oil trains, large and small, rolling through Bend.

“It would be nice to know if there were smaller quantities coming through and if that was increasing,” he said.

While concerned about the dangers of train derailment and fire in towns, Michael Lang, conservation director for Portland-based Friends of the Columbia Gorge, also worries about the risks of an oil spill into the Deschutes River. The rail line through Central Oregon follows the river north of Bend. Along with towns, the large oil trains pass through a section of designated Wild and Scenic River.

“It’s not safe,” Lang said. “It endangers our communities, it endangers our environment. … And we are really concerned about it.”