Category Archives: Bakken Crude

Bakken Crude, Crude By Rail, Derailment, Explosion, Public Health, Public permitting, Public Safety, Valero Crude By Rail, Wildlife

BENICIA HERALD LETTER: Thanks for opposing views of Valero Crude-by-Rail Project

Repost from the Benicia Herald
[Editor:  No link is provided for this letter because the Benicia Herald does not publish Letters in its online edition. – RS]

Thanks for opposing views of Valero Crude-by-Rail Project

By Georgia Taylor Benedict, September 1, 2015, Benicia Herald

Thank you for two thought-provoking columns in the Sunday, Aug. 30 (“Benicia: Not exactly a smart, green city,” by Grant Cooke and “Crude by rail can be solution to Benicia’s budget woes,” by Dan Broadwater).  Mr. Cooke and Mr. Broadwater presented opposing view of the Valero Crude-by-Rail Project.  What was obvious was that Mr. Cooke’s analysis was far more inclusive than that of Mr. Broadwater.

The most obvious point Mr. Broadwater (writing in favor of crude by rail) failed to address was the inherent and demonstrated danger to communities, waterways, wildlife and natural habitats caused for transporting highly volatile Bakken crude over thousands of miles.  Trains derail, leak, and spill fuel and highly toxic crude oil with what appears to be alarming frequency.

The risk to the city of Benicia of a deadly explosion or highly polluted air if this project is approved is not a matter of if but when.  To support this project because it may create 20 long-term jobs is laughable.

I sincerely hope that our elected city officials will deny Valero’s proposal after due consideration.  To fail to do so could be catastrophic for our lovely town.

Air Quality, Bakken Crude, Benicia Planning Commission, Benicians for a Safe and Healthy Community, California Attorney General Kamala Harris, Crude By Rail, Derailment, Environmental Impacts, Explosion, Greenhouse gas emissions, Oil spill, Revised Draft EIR, Tar sands crude, Train collission, Union Pacific Railroad, Valero Benicia Refinery, Valero Crude By Rail, Wildlife

BENICIA HERALD: Long-awaited reissue cites ‘significant’ environmental impacts; public given 45 days to comment

Repost from the Benicia Herald

Revised, expanded crude-by-rail report released

Long-awaited reissue cites ‘significant’ environmental impacts; public given 45 days to comment

By Nick Sestanovich, September 1, 2015

“Because no reasonable, feasible mitigation measures are available that would, if implemented, reduce the significance below the established threshold, this secondary hazards- and hazardous materials-related impact would be significant and unavoidable.”  – The Recirculated Draft Environmental Impact Report on Valero’s Crude-by-Rail Project

The long-awaited revision of the draft Valero Crude-by-Rail Project Environmental Impact Report was released Monday, almost a full year after California’s attorney general and others publicly challenged the scope and accuracy of the document.

The new report cited additional negative environmental effects of the project pertaining to air quality, greenhouse gases, protected species and more, expanding its scope to cover impacts for more “uprail” communities — and finding “significant and unavoidable” effects that would result from approval of the project.

The “recirculated” report (RDEIR) is just the latest development in Valero’s three-year battle to bring crude oil deliveries to its Benicia refinery by train. The proposal for a use permit to extend Union Pacific Railroad lines into its property so crude oil could be delivered by rail car, initially submitted to Benicia Planning Commission in late 2012, triggered an uproar over environmental and safety concerns, which prompted the drafting of an Environmental Impact Report.

The document, released in 2014, was criticized by many, including Attorney General Kamala Harris and state Sen. Lois Wolk, D-Davis, who felt the report’s focus on the 69 miles of rail between Benicia and Roseville didn’t adequately convey the scope of the project’s potentially negative impacts.

The RDEIR addressed these concerns by expanding the range of its focus beyond Roseville to three new routes: the Oregon state line to Roseville; the Nevada state line to northern Roseville; and the Nevada state line to southern Roseville.

In the process, the report uncovered more significant environmental impacts.

The refinery has said it expected 50 to 100 additional rail cars to arrive up to twice a day, brought in at a time of day when there would be little impact on traffic. The trains would carry 70,000 barrels of North American crude each day, replacing shipped barrels from foreign sources, the refinery said in its use permit application.

The DEIR had initially noted that greenhouse gas emissions generated by the Crude-by-Rail Project would be “less than significant.” The RDEIR updated the risk level of direct and indirect greenhouse gas emissions to “significant and unavoidable,” specifically if trains used the line from Oregon to Roseville, which would travel a round-trip distance of 594 miles per day.

Additionally, the RDEIR found that the project would conflict with Executive Order S-3-05, signed by Gov. Arnold Schwarzenegger in 2005, which aims to reduce greenhouse gas emissions to 80 percent below 1990 levels by 2050.

The revised report also found that nitrogen-oxide levels would increase in the Yolo-Solano region, among other areas, and that nitrogen emissions in Placer County “would exceed the cumulative 10-pounds-per-day significance threshold.”

Biological resources are another area of concern. According to the report, crude-by-rail trains could have “potential impacts to biological resources along any southern route,” that “could include collision-related injury and mortality to protected wildlife and migratory bird species.”

Finally, the RDEIR said, other hazards exist: If a train were to crash and result in a small oil spill, there would be a 100-percent chance of 100 gallons or more being released. Similarly, should a train crash in a high fire danger area, the risks would be inevitable.

As the report notes, “Because no reasonable, feasible mitigation measures are available that would, if implemented, reduce the significance below the established threshold, this secondary hazards- and hazardous materials-related impact would be significant and unavoidable.”

Conversely, other areas of concern such as noise pollution and earthquakes, were found to have little or no significant impact.

“Valero’s effort to rush through their dangerous project and their long record of constant violations and fines of Bay Area Air Quality Management District emissions rules give many of us pause to reflect on the many risks associated with this project,” said Andres Soto, a Benicia resident and member of Benicians for a Safe and Healthy Community, a group formed to opposed the Crude-by-Rail Project.

“It is only due to the volume and detail of scope of all of the public comments received on the original Draft Environmental Impact Report (DEIR) that Benicia chose to recirculate a seriously flawed DEIR. California Attorney General Kamala Harris and many uprail communities, as well as many Benicians, including BSHC, identified many critical shortcomings with the original DEIR.

“Valero has shown nothing but intransigence and misinformation in the face of this opposition to its flawed proposal, thus we do not expect much to have changed in the RDEIR from the DEIR that would convince us that Valero and Union Pacific Railroad can make this project safe enough for Benicia. The risk of catastrophic explosions along the rail line and in Benicia, and the plan to process dirtier extreme crude oils strip-mined from Canadian tar sands and fracked in the Bakken shale formation is just too dangerous for our safety and our environment.

“We hope that after thoroughly reviewing the RDEIR, our Planning Commission and City Council will have the wisdom to deny this project for the good of Benicia, our neighboring communities and the good of our planet.”

A Valero representative was asked to comment on the newly released report but did not respond by press time Monday.

Copies of the RDEIR are available at Benicia Public Library, 150 East L St.; at the Community Development Department at Benicia City Hall, 250 East L St.; and as a PDF download on the city’s website, www.ci.benicia.ca.us.

Public comments on the RDEIR will be accepted by the city until Oct. 15 at 5 p.m. Comments may be submitted in writing to Amy Million, principal planner of the Community Development Department, 250 East L St., Benicia, CA 94510; or they may be given at formal public hearings on the project by Benicia Planning Commission, the first of which will be at 6:30 p.m. Sept. 29 at City Hall.

Additional Planning Commission meetings to receive comments on the RDEIR are scheduled for Sept. 30, Oct. 1 and Oct. 8.

Bakken Crude, Crude By Rail, Oil Industry, Oil prices, Oil refineries

Does zero Bakken crude for Irving Oil indicate a trend?

Repost from Railway Age
[Reference:  see the 8/20/15 Wall Street Journal article, Canada’s Largest Refinery Shifts from Bakken Shale Oil to Brent Crudes.  – RS]

Does zero Bakken crude for Irving Oil indicate a trend?

By  William C. Vantuono, Editor-in-Chief, August 28, 2015
Irving Oil Ltd. Saint John, N.B. refinery
Irving Oil Ltd. Saint John, N.B. refinery

Irving Oil Ltd., operator of Canada’s largest crude oil refinery, has stopped importing crude oil sourced from the Bakken shale formation in North Dakota and shipped by rail in favor of cheaper crudes from such producers as OPEC, “reflecting a shift in crude costs affecting East Coast refiners during a global slump in oil prices,” the Wall Street Journal recently reported.

The 320,000-barrel-a-day refinery in Saint John, N.B., one of the biggest by volume in North America, had been receiving 100,000 barrels a day by rail, a high reached two years ago that was only temporarily affected by the Lac Mégantic disaster. (The Montreal, Maine & Atlantic crude oil train that derailed on July 6, 2013, claiming 47 lives, was bound for the refinery). Today, CBR shipments the refinery are zero, a move “that reflects shifting economics in the energy industry even as the price of oil—including Bakken crude—has slumped to six-year lows,” said the WSJ. “About 90% of the crude oil Irving currently buys is shipped by sea from such producers as Saudi Arabia and those in western Africa, with the remainder coming by rail from such western Canadian oil-sands operators as Syncrude Canada Ltd. and Royal Dutch Shell PLC. A year ago, Bakken crude made up about 25% of Irving’s feedstock and in 2013 it supplied nearly one-third of its procurement volume, or about 100,000 barrels a day. ‘The Bakken price has gone up’ relative to other crudes when CBR costs are factored in,’ [an Irving Oil executive] said.”

“A once-yawning gap, between the cost of oil produced in North America and overseas crudes priced at the Brent global benchmark, has narrowed since 2013,” the WSJ noted. “Refiners on North America’s east coast can now import crude shipped by sea for less than the cost of shipping it by rail from shale oil producers in North Dakota and elsewhere in the U.S.”

Production of U.S. shale oil, especially that from the Bakken, led to CBR shipments increasing exponentially due to a lack of pipelines. CBR is more expensive than by shipping by pipeline and even by ship, and fewer refiners are willing to pay a premium for CBR. <p< Whether Irving Oil’s decision to abandon Bakken crude for a single refinery reflects a broader trend that will affect CBR movements remains to be seen. Two other refiners have followed suit, but the situation may not be permanent.

“Refiners PBF Energy Inc. and Phillips 66 both said they increased procurement of overseas crudes at the expense of CBR in the second quarter, though they signaled it is unclear if that will continue throughout the rest of the year,” the WSJ reported. “‘Our ability to source sovereign waterborne crudes was far more economic to the East Coast facilities, and that’s what we did,’ PBF Energy CEO Tom Nimbley said in late July. Phillips 66 CEO and Chairman Greg Garland told investors last month, ‘We actually set [crude-by-rail] cars on the siding. We brought imported crudes in the system.’ But, he added, ‘I’d say given where our expectations are for the third quarter, I’d say cars are coming off the sidings, and we’re going to import less crude.’”

CBR traffic has dropped substantially compared to last year, “reflecting both the worsening economics of CBR and better pipeline access to refineries on the Gulf of Mexico,” the WSJ noted. According to Association of American Railroads figures, U.S. Class I railroads originated 111,068 carloads of crude oil in the second quarter of 2015, down 2,201 carloads from the first quarter and some 21,000 fewer carloads than the peak in 2014’s third quarter.

 

Bakken Crude, Crude By Rail, Derailment, Emergency Readiness & Response, Federal Regulation (U.S.), Fire, Funding for emergency response, Hazmat notification, Massive increase in crude-by-rail, Per-barrel tax, Public safety funding, Rail inspection, Rail Safety, Spill, State regulation, Track maintenance, Volatility

States Step Up Scrutiny of Oil Train Shipments

Repost from GOVERNING The States and Localities

States Step Up Scrutiny of Oil Train Shipments

Some states are looking to prevent more derailments and spills, but the freight industry doesn’t want more regulation.
 By Daniel C. Vock | August 26, 2015
In 2014, several CSX tanker cars carrying crude oil derailed and caught fire along the James River near downtown Lynchburg, Va. (AP/Steve Helber)

When it comes to regulating railroads, states usually let the federal government determine policy. But mounting concerns about the safety of oil trains are making states bolder. In recent months, Oregon, Pennsylvania and Washington state have taken steps to strengthen oversight of the freight rail industry.

The three join several other states — mostly led by Democrats — in policing oil shipments through inspection, regulation and even lawsuits. Washington, for example, applied a 4-cent-per-barrel tax on oil moved by trains to help pay for clean-ups of potential spills. The new law also requires freight rail companies to notify local emergency personnel when oil trains would pass through their communities.

“This means that at a time when the number of oil trains running through Washington is skyrocketing, oil companies will be held accountable for playing a part in preventing and responding to spills,” said Democratic Gov. Jay Inslee when signing the measure this spring.

The flurry of state activity comes in response to a huge surge in the amount of oil transported by rail in the last few years. Oil from the Bakken oil fields in North Dakota and nearby states must travel by train to refineries and ports because there are few pipelines or refineries on the Great Plains. The type of oil found in North Dakota is more volatile — that is, more likely to catch on fire — than most varieties of crude.

Public concerns about the safety of trains carrying oil have increased with the derailments in places like Galena, Ill.; Mt. Carbon, W. Va.; Aliceville, Ala.; Lynchburg, Va.; Casselton, N.D.; and especially Lac-Megantic, Quebec, where 47 people died in 2013.

Federal regulators responded to these incidents by requiring railroads to upgrade their oil train cars, to double check safety equipment on unattended trains, and to tell states when and where oil trains would be passing through their borders. This last requirement was hard won. This summer, the Federal Railroad Administration tried to encourage states to sign nondisclosure agreements with railroads about the location of oil trains. After several states balked, the agency relented.

California, Louisiana, New Jersey, Ohio and Oklahoma have all signed nondisclosure agreements, while Idaho, Illinois, Montana, North Dakota, Washington and Wisconsin have refused to do so, according to the Reporters Committee for Freedom of the Press.

A Maryland judge earlier this month ruled against two rail carriers, Norfolk Southern and CSX, that wanted to block the state’s environmental agency from releasing details of their oil shipments. The railroads have until early next month to decide whether to appeal.

“The ruling isn’t the first time railroads have lost their bid to keep the oil train reports secret,” wrote reporter Curtis Tate of McClatchy, one of the news organizations that requested the records, “but it is the first court decision recognizing the public’s right to see them.”

Many states want this information so that fire departments and other emergency personnel can prepare for a potential derailment. California passed a law last year imposing clean-up fees on oil shipped by rail. The railroad industry challenged the law in court, but a judge ruled this summer that the lawsuit was premature. Minnesota passed a similar law last year, and New York added rail inspectors to cope with the increase in oil train traffic. A 1990 federal law lets states pass their own rules to prepare for oil spills, as long as those rules are at least as rigorous as federal regulations.

In Pennsylvania, which handles 60 to 70 oil trains a week, Democratic Gov. Tom Wolf asked a University of Delaware expert to help to improve safety of oil trains traveling through the state. The professor, Allan Zarembski, produced 27 recommendations for the state and the railroads. He called on the state to improve its inspection processes of railroad tracks, particularly for tracks leading into rail yards, side tracks and refineries that often handle oil trains. The professor also encouraged the state to coordinate emergency response work with the railroads and local communities.

Zarembski’s suggestions for the railroads focused on how they should test for faulty tracks, wheel bearings and axles. Most major derailments in recent years were caused by faulty track or broken equipment, not human error, he noted in his report.