Category Archives: Federal Regulation (U.S.)

Bakken Crude, Canadian regulation, Crude By Rail, Derailment, Explosion, Federal Regulation (U.S.), Oil Industry, Oil industry lobby, Oil stabilization, Phillips 66, Rail industry, Rail industry lobby, San Luis Obispo County, Santa Maria Refinery

The Crude Oil “Bomb Train” Story: Profits Over Safety

Repost from DeSmogBlog

The Crude Oil “Bomb Train” Story: Profits Over Safety

By Justin Mikulka • Friday, May 20, 2016 – 10:42

“I would agree with the opponents. This is not about saving jobs…This is about profits. But gee, what is wrong with profits?”

Those were the words of San Luis Obispo County Planning Commissioner Jim Irving, explaining why he was voting for a project to build a rail spur to the Phillips 66 Santa Maria Refinery so that the refinery can receive oil by rail.

It is a safe bet that Jim Irving hasn’t been to Lac-Megantic, where almost three years ago a very profitable oil train derailed and exploded in the middle of downtown. The immediate damage was 47 lives lost, a massive oil spill, and the burning and contamination of the town center.

Nearly three years later, the downtown has yet to be rebuilt. And as we reported on DeSmog, there were many reasons the Lac-Megantic accident occurred. Averting any one of them could have prevented the accident. All were the result of corporate cost-cutting that put profits ahead of safety.

Also to blame were government regulators who allowed corporations to not invest in safety.

The locomotive engine fire that was the initial cause of the event? Faulty cost-saving repair.

The fact that regulators allowed full oil trains to be parked on a hill above a town, unmanned? Staffing cost savings for railroads.

The “19th century technology” air brakes that failed? More profits over safety.

Poor or non-existent employee training? More savings.

And how about those government regulators’ role in this? How could all of these moves to put profits over safety be allowed? The Globe and Mail looked at all the evidence and pointed the finger directly at the regulators.

There is one federal body that is ultimately responsible for the oversight of Canada’s railways: Transport Canada. The Lac-Mégantic disaster falls squarely at its feet.

It was recently revealed that the government of Canada contributed $75 million to the fund for the victims of Lac-Megantic to avoid further litigation. If they weren’t at fault, why would they pay up?

If you want to ask why allowing the pursuit of profits above all other concerns is a problem —  Lac-Megantic is your answer.

Profits Over Safety: The Rule, Not the Exception

The old air braking system that was involved in Lac-Megantic is the standard for all oil trains. There are modern braking systems known as electronically controlled pneumatic (ECP) brakes that have been described as “a quantum improvement in rail safety” by Joseph Boardman, the former head of the Federal Railroad Administration. But this quantum improvement has not been implemented.

Cynthia Quarterman was in charge of the Pipeline and Hazardous Materials Safety Administration for the majority of the multi-year process when the new oil-by-rail regulations were developed, and based on that process, she believes ECP brakes are a top priority.

“The more I think about it, the more I think that the ECP brakes may be more important than the tank car itself,” Quarterman told USA Today. “Because it would stop the pileup of the cars when there’s a derailment or when there’s a need to brake in a very quick fashion.”

So why aren’t ECP brakes required on oil trains? As DeSmog reported in March of 2015, the industry explained its opposition to ECP brakes in a presentation to regulators, and the opposition included the argument that safer brakes would be “too costly.”

And of course there is the issue of the tank cars used to move the dangerous oil. When the fracking boom happened in North Dakota and there weren’t pipelines to move the oil, the industry quickly built rail loading facilities.

Did the industry also build new safe tank cars to move the oil? No. They began filling the readily available DOT-111 tank cars with oil and started rolling them across North America through big cities and small towns — including Lac-Megantic.

The problem was that the DOT-111s were not designed to move flammable materials like Bakken crude oil, but were made to move things like molasses and corn oil.

But there was money to be made – so it was full-speed ahead with the DOT-111s for Bakken crude.

Shipping Bakken crude oil in DOT-111s has been called “an unacceptable public risk” by a member of the National Transportation Safety Board. But it continues anyway because it is profitable. Gee, what could go wrong with that?

Bomb trains.

The oil could be made safe to transport through a process known as stabilization. But that would require building stabilizing infrastructure in places like North Dakota. That would cut into profits. So it hasn’t been done.

In testimony to the North Dakota Industrial Commission about the proposed regulations to requireoil stabilization,Tony Lucero of oil producer Enerplus explained the reality:

“The flammable characteristics of our product are actually a big piece of why this product is so valuable. That is why we can make these very valuable products like gasoline and jet fuel.”

And so there are no regulations to stabilize the oil because it would be less profitable.

What is wrong with profits? Dangerous oil in unsafe cars with 19th century technology brakes traveling though many North American cities is a good starting point to answer that question.

Profits Buy Plenty of Lobbyists

In January, Sen. Elizabeth Warren (D-MA) released the report “Rigged Justice – How Weak Enforcement Lets Corporate Offenders Off Easy” detailing what is known as regulatory capture — essentially using corporate profits to buy influence over regulators responsible for improving safety. Like the ones who the Globe and Mail said failed the people of Lac-Megantic.

“When it comes to undue industry influence, our rulemaking process is broken from start to finish,” Warrenexplained in March while discussing the report. “At every stage – from the months before a rule is proposed to the final decision of a court hearing a challenge to that rule – the existing process is loaded with opportunities for powerful industry groups to tilt the scales in their favor.”

The math is simple. It is much cheaper to buy lobbyists and influence than it is to invest in safety. And that is what is wrong with an approach that puts the pursuit of profits above all else.

We Can’t Take A Chance That Things Will Be Alright

While the oil and rail industries’ pursuit of profits was championed in California on Monday, a similar discussion was happening on the East Coast in Albany, NY. Albany is the largest oil hub on the East Coast and all of that oil comes by rail.

Now there is a proposal to build a pipeline from Albany to the seaport in Linden, NJ. The pipeline would be fed by oil trains that would arrive in Albany. While it was mostly a symbolic vote — unlike the one in California — the Albany city council voted to oppose the Pilgrim Pipeline this week.

In the public comment period, local Pastor McKinley Johnson, whose church is across the highway from the oil train facility, explained his opposition to the pipeline and more oil trains.

“It is time for us to take a stand,” said Johnson “We can’t take a chance that things will be alright.”

And he is right that this is about taking chances. The oil and rail industries are gambling that an event like Lac-Megantic won’t happen in a big city like Chicago — knowing full well that the proper safety measures are not in place to prevent it.

So far they have been really lucky — and very profitable.

This past weekend, Albany was the site of one of the worldwide Break Free From Fossil Fuels events, and the issue of the oil “bomb trains” was front and center. City council member Vivian Kornegay, who represents the community that lives directly alongside the rail yards where the oil is offloaded, was one of the featured speakers.

She repeatedly made the point that her constituents were taking all of the risk with the trains and getting no reward, saying, “We assume 100% of the risk…and miniscule benefits.”

If you are an oil company in pursuit of profits, that is exactly how you want it.


Vivian Kornegay addresses Break Free rally in Albany, NY   Photo credit: Justin Mikulka

Blog Image Credit: Justin Mikulka

CPC-1232, Crude By Rail, Derailment, DOT-111, DOT-111A, Federal Regulation (U.S.), Tank car design, Tank car retirement, Tank car retrofit

RAIL SAFETY REPORT CARD: Only 225 Of Over 100,000 Unsafe Tank Cars Were Retrofitted in First Year

Repost from DeSmogBlog

Rail Safety Report Card: Only 225 Of Over 100,000 Unsafe Tank Cars Were Retrofitted in First Year

By Justin Mikulka • Monday, May 9, 2016 – 15:12

A year ago, when Federal regulators announced new rules for “high hazard” trains moving crude oil and ethanol, the oil industry protested that the rules were too strict. The main point of contention made by the American Petroleum Institute (API) was that the requirement to retrofit the unsafe DOT-111 and DOT-1232 tank cars within ten years did not allow enough time to get the job done.

Meanwhile, according to information recently provided to DeSmog by the Association of American Railroads, only 225 of the tank cars have been retrofitted in the past year. So, the API may have been onto something because at that rate it will take roughly 500 years to retrofit the entire fleet of DOT-111s and CPC-1232s based on government and industry estimates of fleet size of approximately 110,000.

As DeSmog reported earlier this year, the FAST Act transportation bill that passed in 2015 required that all DOT-111s that have not been retrofitted be retired from crude oil service by 2018. But the bill included the option that “The Secretary may extend the deadlines…if the Secretary determines that insufficient retrofitting shop capacity will prevent the phase-out of tank cars.”

However, prior to the new rule being finalized, Greg Saxton — a representative of leading tank car manufacturer Greenbrier — testified in Congress that there was sufficient shop capacity to meet the timeline noting that,“This is an aggressive timeline, we believe it is achievable.”

Saxton also made the assertion that the lack of new regulations was the issue that was delaying the safety retrofits.

“The only thing holding the industry back is the government’s inaction on proposed new tank car design standards and a deadline for having an upgraded rail tank car fleet.”

Now a year after the new rule was announced, with a mere 225 cars undergoing the safety upgrades, it would appear that was not the only thing holding back the industry.

DeSmog reached out to the Railway Supply Institute, leading oil-by-rail carrier BNSF, and Greenbrier to inquire about the lack of retrofits to date and asked if shop capacity was an issue, but did not receive any response. The Association of American Railroads and the Federal Railroad Administration were unable to provide information on shop capacity.

Unlike Safety, Public Relations On Schedule

Despite not actually making any significant safety improvements to the unsafe DOT-111 tank cars — tank cars called an “unacceptable public risk” by a member of the National Transportation Safety Board — the public relations effort to push the idea that the issue has been addressed appears to be successful.

In an article published in Chicago Magazine in April 2016, the risks of oil-by-rail were covered in detail. However, that article included the following statement, “Those first-generation tank cars, called DOT-111s, have almost all been subjected to new protections, including having their shells reinforced with steel a sixteenth of an inch thicker than used in earlier models.”

But 225 tanker cars clearly does not qualify as “almost all” of the DOT-111 oil tank car fleet.

An article published shortly after the FAST Act was signed ran with the headline, “New Highway Bill Includes Tough Rules for Oil Trains.” Again, this would seem like overstating the reality of what the bill included.

As DeSmog has noted before, the oil and rail industries are very good at public relations when it concerns this topic. However, as when BNSF said they were buying 5,000 new tank cars that would exceed all safety standards, it often never results in anything more than a press release and some media coverage. BNSF never purchased the 5,000 tank cars.

Unsafe Tank Cars Can Carry More Oil and Bring Higher Profits

In January, Christopher A. Hart, the head of the National Transportation Safety Board, presented his remarks on the NTSB’s safety “Most Wanted List” and once again mentioned the risk of the DOT-111s in moving crude oil.

“We have been lucky thus far that derailments involving flammable liquids in America have not yet occurred in a populated area,” Hart said. “But an American version of Lac-Megantic could happen at any time.”

Why would the industry want to take this risk? Could it be because unsafe cars are more profitable?

The more oil a tank car can haul, the more profitable that oil train will be. The way rail works is that the weight of the car plus the weight of the cargo can only combine to be a certain amount. If your tank car weighs less, you can put in more oil because it effectively has more capacity.

Exxon made this case to regulators prior to the rulemaking. Check out this slide the company presented that points out that adding safety measures “reduces capacity” — which reduces profit.

Tank cars full of volatile Bakken crude oil — deemed an “unacceptable public risk” by an NTSB member — continue to move through communities across North America. And the tank car owners are not moving to make the required safety retrofits.

While oil-by-rail traffic is declining with the current low oil prices, that is unlikely to continue. And with the lack of pipeline infrastructure needed to move dilbit from ever-increasing tar sands oil production, industry opinion holds that rail has a good chance of making a comeback. And they are going to need rail cars to move that oil.

The question remains: Will the Secretary of the Department of Transportation use the loophole in the FAST Act to grant the industry an extension on using DOT-111s past 2018?

If history is any indication, with rail safety improvements such as positive train control being repeatedly delayed for decades — including a recent three-year extension by Congress — it would appear that is a likely outcome if the DOT-111s are needed by the oil industry.

This makes the prediction by the head of the NTSB that “an American version of Lac-Megantic could happen at any time” all the more likely to eventually occur.

Blog Image Credit: Justin Mikulka

Crude By Rail, Derailment, Emergency Readiness & Response, Explosion, Federal Regulation (U.S.), Funding for emergency response

US Senate passes emergency-responders training bill

Repost from Progressive Railroading

Rail News: Federal Legislation & Regulation – Senate passes emergency-responders training bill

May 13, 2016

The U.S. Senate has passed a bill that would enable first responders to be trained in handling crude-oil train derailments and other hazardous incidents, U.S. Sen. Heidi Heitkamp (D-N.D.) announced yesterday.

Heitkamp introduced the Railroad Emergency Services Preparedness, Operational Needs, and Safety Evaluation (RESPONSE) Act in response to a crude-oil train derailment in Casselton, N.D., in late 2013.

The bill would establish a public-private council that combines emergency responders, federal agencies and leading experts to review training and best practices for first responders. The council would provide Congress with recommendations on how to address first responders’ safety needs with increased railway safety challenges, according to a press release issued by Heitkamp’s office.

“First responders — the vast majority of whom are volunteers in North Dakota — selflessly put their lives on the line and run toward danger to protect our families,” said Heitkamp. “That’s exactly what happened in Casselton one December afternoon in 2013, when responders ran toward the black smoke of a train derailment that could be seen for miles — and it’s what our country has continued to see following oil train derailments throughout the country.”

More than 40 percent of North Dakota crude oil is transported by rail.

The bipartisan legislation passed unanimously in the Senate. A companion bill has been introduced in the House by U.S. Rep. Ron Kind (D-Wis.).

 

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.