Thanks to an alert from Lynne Nitler of Davis for the following information. – RS
Sacramento Area Council of Governments to meet, will consider draft letter critical of Valero Crude By Rail
We learned last week that the Sacramento Area Council of Governments (SACOG) will meet on August 21 to consider a staff proposal that would level a stinging critique of the City of Benicia’s Draft EIR on Valero Crude By Rail. Valero is proposing twice-daily rail shipments of 70,000 barrels of crude, and the DEIR claims that Valero’s 100 tank cars every day will pose no significant threat to Benicia and other cities along the rails, including Davis, Sacramento and Roseville.
SACOG is a planning agency for the region’s six counties and 22 cities.
A draft of the SACOG letter was made public on August 5. It finds the Benicia report “fundamentally flawed” and calls for a revision and recirculation of the DEIR.
The 12-page letter is in draft form, and needs to be reviewed by the entire SACOG Board on August 21 before it will be finalized and sent to Benicia.
Because the letter is very strong in its position that the DEIR is inadequate in its present form, a number of Valero and Union Pacific representatives showed up at a SACOG committee meeting last week. They tried to dissuade the committee from passing the letter and offered to talk out the problem areas so no letter would be necessary. They were not successful in their attempts.
SACOG Board of Directors August 21, 2014, 9:30 a.m. 1415 L St #300, Sacramento, CA Agenda
The Bainbridge Island City Council is poised to make its collective voice heard on one of the most important issues facing the Puget Sound region: The massive increase in oil-by-rail shipments and the potential damage that a train derailment could pose to public safety and the environment.
The Bainbridge council gave an initial nod to a resolution calling for increased regulations on the design of oil tank cars at this week’s meeting.
A final council vote on the resolution — which includes a call for the state to assess the impact of oil trains on public safety, the environment and the economy — is expected at next week’s meeting.
The resolution pulls no punches, and that’s good. It asks the governor and state agencies to hold off from permitting projects that would expand the capacity of out-of-state oil exporting projects that would increase the number of trains, vessels or pipelines carrying oil near Puget Sound until safety and environmental impacts can be studied and addressed.
City officials note that trains carrying fracked crude oil from the Bakken oil fields in North Dakota have been running to ports and refineries in Washington state since 2012. The trains run the full length of Puget Sound, and officials report there are 10 crude oil-by-rail projects being planned, built or already in operation. In 2013, oil shipments totaling 17 million barrels were transported in Washington. That number is expected to triple this year.
Oil transport by train is not only an environmental menace, it’s deadly. There have been five major derailments since July 2013, and a derailment and explosion in Quebec killed 47 people.
Other cities — Edmonds, Bellingham, Mukilteo, Seattle, Spokane — have already passed resolutions voicing concerns on oil trains. The Bainbridge council is serving our island residents well by raising their voices on our behalf.
by Lynne Nittler, August 10, 2014
Oil tanker cars travel by rail through Davis on a recent evening. Valero oil refinery in Benicia wants to expand its oil shipments to 100 tank cars per day. Jean Jackman/Courtesy photo
The story of crude-by-rail in California is not a done deal. As new developments unfold almost daily in this remarkable drama, it is clear that public input can make a significant impact.
For example, last January, fierce community opposition — plus a letter from state Attorney General Kamala Harris urging further scrutiny on air quality and the risk of accidental spills — led city leaders in Pittsburg to reopen the public comment period on its draft environmental documents.
The WesPac Petroleum project had called for an average of 242,000 barrels of crude — the equivalent of 3.5 trains per day — to be unloaded daily and stored in 16 tanks before being piped to the five Bay Area refineries. Now, it appears WesPac may never reapply. An alert public can bring about change.
Valero in Benicia is a long way from giving up on the rail terminal that will allow it to import 100 tank cars of crude by rail daily, most likely from the tar sands of Alberta, Canada, and the Bakken Crude shale of North Dakota. These two extreme forms of crude — Bakken crude is highly volatile and proven explosive and tar sands bitumen is toxic and impossible to clean up in a spill (Kalamazoo spill, July 2010) — are already being processed in some Bay Area refineries.
The California Energy Commission predicts within two years that California will receive 25 percent of its crude by rail, mostly from these two extreme crudes that emergency workers currently are not prepared to deal with in the event of a spill or accident. For the Sacramento region, that will mean five to six trains of 100 cars per day by the end of 2016!
Your input now may make a significant difference. The draft environmental impact report for the Valero proposal is open for public review until Sept. 15. A printed copy is at the Stephens Branch Library, 315 E. 14th St. in Davis, and is available online at www.benindy.wpengine.com. Every letter submitted becomes part of the public record and must be addressed in the final EIR.
Frankly, the draft EIR focuses on impacts to Benicia, and just glances at uprail communities like Davis. But two 50-car trains coming across the Yolo Causeway and the protected Yolo Basin Wildlife Area; passing high-tech businesses along Second Street; rolling into town through residential neighborhoods, where the vibrations will be felt from each heavy car; following the unusual and therefore dangerous 10 mph crossover just before the train station; passing through the train station, putting the entire downtown within the blast zone; and skirting the edge of UC Davis, including the Mondavi Center for the Performing Arts; puts many people at serious risk.
If you have concerns such as whether the tank cars are safe enough, whether the volatility of the Bakken crude should be reduced before it is loaded into tank cars, who is liable in the event of an accident, whether the trains will be equipped with positive train control to improve braking, how Valero plans to mitigate the increased air and noise pollution, how Valero can claim that accidents happen only once in 111 years, etc., then you can help.
While our city of Davis, Yolo County, Sacramento, Roseville, Fairfield, the Sacramento Area Council of Governments and the Sierra Club Yolano Group are writing their own responses to the Valero draft EIR, letters from private citizens are equally powerful.
Public workshops are planned in August and September to help residents craft their letters. They workshops will provide background on the oil train situation, discuss the California Environmental Quality Act and EIR process and offer helpful resource materials. Participants will find topics, gather evidence, write their letters and then share drafts for feedback.
Workshops are planned from 10 a.m. to noon Saturday, Aug. 9; 7 to 9 p.m. Thursday, Aug. 21; and 2 to 4 p.m. Sunday, Sept. 7. All will take place in the Blanchard Room at the Stephens Branch Library, 315 E. 14th St. in Davis. The room is accessible to people with disabilities.
The draft EIR and mailing directions are posted at www.benindy.wpengine.com. For more information, contact me at lnittler@sbcgloball.net or 530-756-8110.
Surge in Rail Shipments of Oil Sidetracks Other Industries
Pileups at BNSF Railway Is Causing Delays for Shippers of Goods Ranging From Coal to Sugar
By Betsy Morris, Jacob Bunge and John W. Miller, March 13, 2014
A train carrying crude oil heads west through the small town of Shelby, Mont., in November. A major snarl in railroad traffic is ricocheting through the supply chains of businesses across the U.S. AP
A major snarl in railroad traffic is ricocheting through the supply chains of businesses across the U.S., causing delays and losses for shippers of goods ranging from coal to sugar.
Many of the problems stem from pileups at BNSF Railway Co. in a critical northern stretch of the country where it is shipping crude oil from North Dakota’s booming Bakken Shale region. The railroad, one of the biggest in North America, was already taxed by the heavy demand for oil transport. But its difficulties multiplied when it ran out of locomotives and crew, as a bitter winter forced it to use smaller trains.
That has caused a ripple effect across the country as shipments have been delayed. Deliveries of empty grain cars to farmers and grain elevators in the Midwest and Great Plains are running about two to three weeks late, the railroad says. The chief of a major sugar producer said he likes to load 50 railcars a day this time of year, but BNSF sometimes brings more than 50 and sometimes 30.
An executive close to big utility companies says coal-fired power plant inventories are running much lower than the usual 30 days. “The railroads tell us they aren’t serving power plants until their inventories are in single-digit days,” he said.
BNSF isn’t the only railroad with capacity problems, but its woes have been aggravated by a big grain harvest and its surging crude business.
The railroad knew it was in trouble when winter hit. “We found ourselves behind the curve,” said Bob Lease, vice president, service design and performance, for BNSF. “Now, we are finding we can’t fill all of the demand” as quickly as usual.
The backlogs could wind up costing shippers hundreds of millions of dollars, says Steve Sharp, president of Consumers United for Rail Equity, a group representing agriculture companies, manufacturers and utilities. His group has been pushing for tougher railroad regulation.
Andrew Walmsley, director of congressional relations for the American Farm Bureau Federation, a trade group for farmers, worries that continued capacity problems could hurt U.S. competitiveness in the world arena. “Our reliability as a trading partner comes into question anytime we can’t provide the most cost-competitive price in a predictable and timely manner,” he said.
BNSF is scrambling. The railroad is leasing and buying locomotives by the hundreds and hiring new crews. In mid-February it began building new track on top of frozen snow-covered ground along its main oil-patch route. It normally wouldn’t have attempted such a project until spring.
Mr. Lease says traffic should become more “normalized” by April 1, but he concedes that the railroad’s challenges will extend through 2014. “It takes a while to unravel,” he said.
BNSF, a unit of Warren Buffett’s Berkshire Hathaway Inc., BRKB +1.19% invented the business of carrying crude oil by rail when it launched its first long oil train, essentially a rolling pipeline, in 2009. The business has sharply exceeded its expectations. Shipments of crude by rail from North Dakota rocketed to a peak of 800,000 barrels a day last October from fewer than 100,000 barrels a day in 2010.
The surge has contributed to a tangle with potentially widespread impact. Larry Stranghoener, chief financial officer of fertilizer maker Mosaic Co. MOS +0.73% , says that transport problems, including the crunch in railroad capacity, could spell “a slower season.”
“The primary preoccupation of our sales force, our supply chain and our customers frankly is getting product to them in time for the spring season,” he told the Minneapolis-area company’s investors Wednesday. Any delays transporting Mosaic’s fertilizer to dealers could cause them to defer additional orders, he said.
Some shippers, eager to move their products, have opted to use trucks. Trucking rates compare with rail costs within a 500-mile radius, but beyond that companies can wind up paying four to five times as much on a per-ton basis, says one shipping official.
At Black Gold Farms, based in Grand Forks, N.D., Chief Executive Gregg Halverson says his company has had to pay more to hire trucks to transport its potatoes, which it sells to chip makers.
“There’s more demand for truck transportation, and that hits us between the eyes,” Mr. Halverson said. “It’s not only the actual availability of the trucks, but trucking firms having trouble getting drivers, because of demand from the oil patch.” He declined to estimate how much more he is paying for trucks.
American Crystal Sugar Co., which says it supplies about 15% of the nation’s sugar, had to slow production at three of its five plants for 11 days in mid-February because it was running out of storage space while waiting for trains to ship its sugar to food companies. That has disrupted the Moorhead, Minn.-based cooperative’s just-in-time delivery system, said David Berg, its chief executive. “The railroad just threw that into complete chaos,” he said.
He said delays in outbound shipments of sugar have interfered with the production schedules of American Crystal’s customers, many of them major food manufacturers.
While he said he wasn’t aware of any food companies that have had to halt production, “They’ve been running on fumes for weeks,” he said. “We’ve been humping trucks all over the U.S. to keep people in supply.” American Crystal supplies General Mills Inc., GIS +1.27% Kraft Foods Group Inc., KRFT +1.30% Nestlé SA, Mars Inc. and Kellogg Co. K +1.09% , among others.
Mr. Berg and Perry Cerminara, director of global sweetener and energy-risk management at Hershey Co. HSY +0.07% , called the problems caused by BNSF “serious” in a March 4 letter to regulators and stressed the “urgent” need to fix them. Mr. Cerminara wrote on behalf of the Sweetener Users Association, representing food manufacturers.
A spokesman for BNSF said it is working with customers individually to address their most critical issues and plans record spending on expansion this year.
Utilities are hoping railroads can improve their capacity before the busy summer season. “We try to build up inventories to around 40 days, so we’re counting on spring,” said one official at a coal-fired power plant. But, he added, “We’re not counting on a magic bullet.”
—Tony C. Dreibus, Annie Gasparro, Chester Dawson, David George-Cosh and Laura Stevens contributed to this article.
