Repost from Bloomberg [Editor: Significant quote: “‘The East Coast was left on a figurative island when everyone in the middle of the country got access to low-priced crude coming out of the Bakken, and oil by rail was its lifeline….The next challenge is exports.'” – RS]
Bakken Rail Bet on a Feeling Pays Off for Global’s Slifka
By Lynn Doan Aug 1, 2014
When Eric Slifka landed in North Dakota’s Bakken shale field three years ago, he says he was overcome by “this feeling of a lot of growth. You could feel the pressure.”
The fervor was so strong that Slifka, chief executive officer of Global Partners LP (GLP) in Waltham, Massachusetts, decided in that single trip to carry Bakken crude on railcars that his company had been using to haul ethanol to New York. His first full trains started a wave of deliveries that rescued East Coast refiners from the brink of closing amid the rising cost of oil imported from Africa and the North Sea.
Shipments of U.S. oil by rail have since doubled to more than 1 million barrels a day, sparking a national debate over safety, and volumes may mount if the government allows more exports of crude, easing a four-decade ban. Global and other midstream carriers are preparing themselves for a chance to serve that market.
“The East Coast was left on a figurative island when everyone in the middle of the country got access to low-priced crude coming out of the Bakken, and oil by rail was its lifeline,” Bradley Olsen, managing director at energy investment bank Tudor, Pickering, Holt & Co., said by phone from Houston. “The next challenge is exports.”
Shale Boom
Global Partners, a tax-exempt master limited partnership with a $1.19 billion market value, was worth half that when Slifka flew into the Bakken in 2011 to meet a local entrepreneur who owned a rail facility along the Canadian Pacific (CP) line. North Dakota’s oil production had surged by a record 42 percent to 310,000 barrels a day. It would go on to surpass 1 million this April, helping turn the U.S. into the world’s largest oil producer.
The flood of domestic crude has put pressure on the federal government to lift a ban on U.S. exports imposed by Congress in 1975 in response to the Arab oil crisis. Crude-by-rail companies will have to compete with pipelines to bring supplies to the coast if the prohibition is lifted, Olsen said.
“Once you’re trying to export, you’re just trying to reach the water, and you don’t care about going to a specific refinery,” he said. “So you’re just as likely to ship it on a pipeline to get it to a dock.”
New Rules
The boom has also ignited regulatory battles from coast to coast. The derailment and explosion of an oil train in Lac-Megantic, Quebec, in July 2013 that killed 47 people thrust rail operations into the limelight.
In New York, Global is facing a ban on expanding its Albany operations to include tar sands. In Oregon, state regulators said in March that Global unloaded more oil than permitted at its Clatskanie terminal that sends Bakken crude along the Columbia River by barge.
Global said the Oregon complex is “in full compliance” with regulations in a March 5 e-mail. It sent a letter to Albany County on March 14 describing the county prohibition as “arbitrary and capricious.”
The U.S. Department of Transportation laid out a plan last week to phase out a generation of tank cars for crude shipments and impose speed limits, braking requirements and route stipulations.
While the industry is working with regulators to determine the safest way to ship oil, Slifka, now 49, said at an energy conference in Washington July 14 that “rail may actually be the safest mode of transportation for crude.”
Refinery Squeeze
On his first visit three years ago, so many companies were racing into the region to squeeze out oil from the Bakken that Slifka couldn’t find a hotel room. He said he stayed in Estevan, Saskatchewan, and drove 30 miles across the Canada-U.S. border to meet Don Bottrell, who owned a women’s clothing business, oil and gas wells and a trans-loading site in the area.
The biggest wave of refinery closings had meanwhile struck the East Coast as the price of North Sea Brent crude, the international benchmark, climbed. Sunoco Inc. was threatening to shut its Philadelphia refinery if it didn’t find a buyer, and it idled the Marcus Hook plant in Pennsylvania. ConocoPhillips halted output from its Trainer complex, and Hovensa LLC closed a plant in the U.S. Virgin Islands that supplied the region.
The North Sea grade cost as much as $8.52 a barrel more than West Texas Intermediate today, the highest premium since June 24. WTI was at $97.21 at about 11:16 a.m. in London and has traded below the international benchmark since the end of 2010.
Crude Champagne
“East Coast plants had the highest costs because they ran the champagne of oils, very light, very low-sulfur crudes predominantly from West Africa,” Kevin Waguespack, senior vice president of energy consulting firm Baker & O’Brien Inc., said by telephone from Houston July 28. “The Bakken reset their feedstock costs by several dollars a barrel. They’ve gone from losing to winning.”
EOG Resources Inc. (EOG), at the time the second-largest oil producer in the formation, moved its first trainload on BNSF Railway Co.’s tracks to Stroud, Oklahoma, on Dec. 31, 2009.
The first dedicated train of Bakken crude arrived at Global’s fuel terminal in Albany, which had handled ethanol and refined fuels such as gasoline, on Oct. 25, 2011.
Others followed. Enbridge Inc. (ENB)’s 80,000-barrel-a-day Eddystone rail complex outside Philadelphia received its first train in May. The Carlyle Group (CG) and Sunoco formed a joint venture to keep the Philadelphia refinery open and are adding a rail track that will take as many as 14 unit trains of Bakken oil a week. Delta Air Lines Inc. (DAL) bought Conoco’s Trainer plant and on July 21 signed a contract for 65,000 barrels a day, more than a third of the plant’s capacity, that will initially arrive by rail.
Global Expansion
Global bought a majority interest in two Bakken terminals after that first delivery to the East Coast, expanded its complex in Albany so it could send barges of oil down the coast, and secured a five-year contract to supply Phillips 66 (PSX)’s 238,000-barrel-a-day Bayway refinery in New Jersey in 2013.
The company bought the complex in Clatskanie, near Portland, the same year. On July 8 Global said it was building its first Gulf Coast oil-by-rail terminal in Port Arthur, Texas, as a destination for heavy crude from western Canada.
“If you look back historically on where oil is coming from and how it was transported, it has completely changed,” Slifka told an oil industry conference in Washington July 14. “You might as well take a pipeline map and turn it upside down.”
With the Port Arthur terminal, Global is positioned for the flood of petroleum that may soon be leaving the nation’s shores should federal policy makers relax the decades-old export ban. In June, the Commerce Department granted Enterprise Products Partners LP (EPD) and Pioneer Natural Resources Co. (PXD) permission to export ultra-light oil known as condensate.
“Nobody can be sure where the market is going or what we will be carrying, but we are sure that we have positioned ourselves to carry whatever it demands,” Slifka said at the meeting in Washington.
Reporter on this story: Lynn Doan in San Francisco. Editors responsible for this story: Dan Stets and David Marino at Bloomdale, and Alaric Nightingale, Rachel Graham.
Editorials, July 31, 2014
This July 6, 2013 file photo shows a worker, wearing protective gear moving though the wreckage of the oil train derailment and explosion in in Lac-Megantic, Quebec (AP Photo/Ryan Remiorz, File, Pool)
America’s drilling boom means more freight trains are snaking through Chicago carrying oil, which can erupt into fireballs if the tank cars derail. A new federal proposal to make the cars safer should be enacted as quickly as possible, and any changes in the final rules should enhance safety, not weaken it.
On July 23, U.S. Transportation Secretary Anthony Foxx proposed phasing out tens of thousands of tank cars called DOT-111s that date back to the 1960s and that too easily rupture or get punctured in derailments. In the past six years, oil has spilled in 10 major derailments, many of them fiery. In the worst, 47 people died last year in Quebec. In April, 30,000 gallons of crude oil leaked into the James River amid a blazing derailment near downtown Lynchburg, Va.
Because more than 40 oil-carrying trains pass through metropolitan Chicago every week, the safety proposal is critical. Mayor Rahm Emanuel called it a “very important step to reduce the risk of catastrophic disasters in our cities.”
The weaknesses of older tank cars, which include about 78,000 of the 92,000 now in use, have been known for 25 years. But now there’s a new reason to worry about them. A boom in American oil production, largely due to hydraulic fracturing — or fracking — that extracts petroleum from places where oil pipelines don’t go, has led to a surge in oil-carrying freights. Nationwide, the number of oil carloads jumped from 9,500 in 2008 to 434,000 last year. Trains carrying crude often are longer than 100 tank cars and can carry more than a million gallons.
In May, the U.S. Department of Transportation issued an emergency order requiring railroads to notify local officials before trains carrying large quantities of crude pass through. Now, the department has proposed a range of additional safety options, including requiring new or retrofitted tank cars to have thicker shells, more effective brakes and roll-over protections. Tank cars that don’t meet the new standards would be phased out after two years if they carry the most flammable fuels, including ethanol and most grades of crude oil.
Foxx also is calling for speed limits on trains transporting the fuels, especially through highly populated areas, and testing of the liquids they carry.
The proposals will go through negotiations, including a public comment period, before the final rules come out. Not everyone will agree: Industry representatives, for example, think the proposed speed limits are too low and environmentalists think they are too high.
Fortunately, industry players, including the Association of American Railroads and the American Petroleum Institute, agree tank cars need to be safer. They have offered their own safety enhancements, which don’t go as far as those proposed by Foxx. For example, they want a three-year phase-out period instead of two and would select a design used on tank cars built since 2011 as the new, safer standard.
The final rules should take into account legitimate concerns of business and environmentalists, but the government shouldn’t significantly water down the safety proposals nor let negotiations drag on, putting off the day crude shipments get safer.
We don’t want to see any disastrous fireballs along the many rail lines running through Chicago and its suburbs.
Repost from Emergency Management Magazine [Editor: Note the source of this article. From the “About” page: “Emergency Management is the award-winning, all-hazards publication of record for emergency management, public safety and homeland security stakeholders charged to protect our communities, critical infrastructure and the security of our nation.” – RS]
States Focus on Rail and Energy Pipeline Safety
Sharp increases in U.S. oil production have caused safety problems transporting the liquid. Now states are trying to fix the problem.
Jeffrey Stinson, Stateline | July 31, 2014
The sharp increase in U.S. oil production and its promise of energy independence is coming with a disastrous byproduct: spills that threaten lives, communities and the environment.
In the past 18 months, about 1.2 million gallons of crude oil produced in the U.S. or Canada has been spilled from train cars and pipelines in at least seven states, sparking explosions, fires, or the evacuation of homes or offices in four instances.
Nobody has to tell the residents of Lynchburg, Virginia about the danger of the millions of gallons of crude oil rolling along rail lines or through pipelines every day. On April 30, more than a dozen train cars filled with crude oil derailed near Lynchburg’s downtown, causing a fire that forced hundreds of people in a 20-block area to evacuate. Nobody was injured, but thousands of gallons of oil spilled into the James River.
In response to the growing problem, the U.S. Department of Transportation last week issued proposed rules calling for upgraded railroad cars, better braking systems and tighter speed controls.
The federal action followed stepped-up efforts by several states to try to prevent spills and respond to disasters:
The California legislature last month approved a new 6.5-cent fee on every barrel on crude oil carried by rail and some pipelines through the state. The state will use the money, estimated to bring in $11 million in the first full year, to expand its coastal spill prevention and response program to inland streams, rivers, lakes and wetlands. It’s also beefing up its rail safety inspection program.
Minnesota Gov. Mark Dayton, a Democrat, signed legislation in May to implement stricter oversight of railroad companies, require more rail inspections and provide for better emergency response training and preparedness. To pay for it, Minnesota this year will collect $6.4 million in fees from railroads and pipeline companies.
New Hampshire Gov. Maggie Hassan, a Democrat, signed legislation earlier this month that authorizes the state to impose stricter preparation and response requirements on pipelines than federal law requires. The state Public Utility Commission also was given authority to inspect interstate pipelines to provide more frequent checks than federal officials give.
Oregon Democratic Gov. John Kitzhaber last week released a study of oil moving through his state that calls for more state rail inspectors, more money for training and improved cooperation with railroads. Last month, Washington Gov. Jay Inslee, a Democrat, ordered a similar review of risks, regulations and preparedness in his state. In January, New York Democratic Gov. Andrew Cuomo also issued a similar order and dispatched inspectors to rail yards to look for defects on cars that could cause derailments.
Nearly all the action in the states was prompted by disasters governors and lawmakers saw in other states or across the border in Canada. Their worst fear is what happened in Lac-Megantic, Quebec, where 47 people were killed last July when an unattended 74-car train derailed. The spilled crude caught fire, then several cars exploded and about half the downtown was destroyed.
“I want to know how much oil will be shipped through my state and how we can be assured the kind of tragedy that happened in Quebec won’t devastate families in our communities,” Inslee said last month in ordering the study in Washington.
Matt Swenson, Dayton’s press secretary, said Minnesotans only needed to look at neighboring North Dakota to see what could happen: Last December, a train carrying grain derailed in front of a mile-long train carrying crude oil near Casselton, not far from the Minnesota border. Twenty cars spilled oil, some exploded. Fire forced evacuation of the town, but nobody was injured.
Every day, seven similar oil trains with about 110 cars carrying about 3.3 million gallons of crude travel through Minnesota, the state said. Other states are witnessing similar traffic, and it’s on the rise.
About 264 million gallons of crude oil were shipped by rail through California last year, said Alexia Retallack in the state Fish and Wildlife Department’s Office of Spill Prevention and Response. That’s 46.2 million gallons more than in 2012.
Railroads Pick Up Slack
More crude oil is on the move across states as production in North America booms from the fracking of Bakken oil deposits underlying North Dakota, Montana, and Canada’s Saskatchewan and Manitoba provinces, and from the tar sands of Alberta.
Production in the U.S. alone will be 8.5 million barrels a day this year, the U.S. Energy Information Administration estimates. That’s estimated to grow to 9.3 million barrels daily next year. And there aren’t enough pipelines to get the crude to the nation’s 115 refineries to be turned into gasoline and other products.
Republican North Dakota Gov. Jack Dalrymple said last month that pipeline capacity in his state needs to double to about 1.4 million barrels a day by 2016 to carry all the crude produced there. Currently, the state is producing about 220,000 barrels a day more than pipes can carry.
Railroads are picking up the slack, even though the Congressional Research Service said in a May report that it can cost from $5 to $10 more a barrel than pipeline delivery. The number of carloads of crude oil, each carrying about 30,000 gallons, that ended up inside the U.S. rose to 435,560 last year, the Association of American Railroads says. That’s up from about 30,000 in 2010.
In a recent analysis of data from the federal Pipeline and Hazardous Material Safety Administration, the McClatchy News Service found that 1.15 million gallons of crude oil spilled from rail cars in the U.S. last year. That’s more than in all the years combined since the data was first collected nearly four decades ago.
The worst accident was in November in Aliceville, Alabama, where 748,800 gallons spilled from a 90-car train after 12 cars derailed and three exploded. Nobody was injured.
Although widely considered safer than rail shipment of crude, pipelines do spill. A split in a pipeline in March 2013 dumped as much as 5,000 barrels of Canadian tar sands oil into a neighborhood in Mayflower, Arkansas.
Concern over pipeline spills is what drove New Hampshire state Sen. Jeff Woodburn to sponsor the legislation giving his state greater control over pipelines. The source of worry is that the 236-mile Portland-Montreal Pipeline, built to carry conventional crude oil from Maine, through New Hampshire and Vermont to Canadian refineries, can instead be used to ship to the U.S. tar sands oil, which is heavier and dirtier.
A spill, Woodburn, a Democrat, said, could devastate the fragile environment in his northern area of the state, which attracts tourists.
An analysis of federal spill data by the Manhattan Institute for Policy Research last year found that through 2009, pipelines released more oil per spill than rail. Even with the recent increase in oil transported by rail, pipelines still carry much more. Furthermore, because pipelines often run through isolated areas, it often takes longer to get to the site of a leak and seal it.
But there’s a difference between pipeline spills and rail car spills, said Carl Weimer, a Whatcom County, Washington, commissioner and executive director of the Pipeline Safety Trust that studies and advocates for greater pipeline safety.
Pipelines may spill more oil when an accident happens, Weimer said, but they usually cause mostly environmental damage because they’re located in out-of-the-way places. Railroads travel through populated areas and their spills can endanger more people and cause greater property damage.
“The real question is: Is either one as safe as they need to be?” Weimer said. “I don’t think they are.”
Lighter and Sweeter
The nature of much of the oil being shipped is heightening states’ concerns. Bakken crude is a lighter, sweeter crude that federal regulators say may be more flammable than other crude – though the American Petroleum Institute that represents the oil and gas industry disputes that.
Bakken crude was involved in the fiery crashes in Virginia, North Dakota, Alabama and in Quebec.
The new proposed federal rules are largely aimed at Bakken crude. Older rail tanker cars will be banned from shipping it across the states within two years unless they’re retrofitted with thicker skins and anti-rollover protection to meet the newest standards.
At present, the freight railroad industry says it uses about 92,000 tank cars to carry flammable liquids, such as crude, and that 18,000 are built to the latest standards.
The Association of American Railroads says the industry already has moved to reduce speeds on oil trains with 20 or more cars carrying crude and include at least one older tank car to no faster than 40 mph in 46 urban areas around the country.
Federal regulators are weighing whether they should go even slower, possibly 40 mph in all areas and 30 mph in urban areas. But the association, which represents major carriers, said going just 30 mph in urban areas could cost it 10 percent of its capacity to ship cargo, and slow down some freight and Amtrak passenger trains traveling across parts of the country.
Railroads also are alerting states when and where trains carrying 1 million gallons or more of Bakken crude will travel in keeping with a May 15 order from the U.S. Department of Transportation. And they’ve said they’ll work with the states and communities on any new spill response efforts just as they have so far.
“We take our responsibility for moving oil in a safe and efficient manner seriously,” the railroad association said. “That is why the rail industry is working with our customers, suppliers and (federal regulators) to find ways to make a safe network even safer.”
That’s what states say they’re doing, too, as they know their citizens need the energy and at a reasonable price.
“We need to move crude oil,” said California’s Retallack. “But we need to do it in a way that doesn’t pose risks to citizens or the environment.”
Or, as Sen. Woodburn of New Hampshire put it: “We want to be accepting to changes and challenges on the energy front – but we want to be in the driver’s seat.”
This article was originally published by Stateline. Stateline is a nonpartisan, nonprofit news service of the Pew Charitable Trusts that provides daily reporting and analysis on trends in state policy.
Repost from Boulder Weekly [Editor – Significant quote: “The library and the post office. A dozen schools. Hundreds of homes. Parks. Every brewery (oh god). Ten gas stations. The wastewater treatment facility. It can all go up in flames at any minute — and that’s just in Longmont. All you’ll hear is a whistle and a boom.” Along with Part II, this article covers many of the most important issues on the crude by rail boom. – RS]
Oil Boom, Part I: Boulder County’s growing risk from trains hauling undeclared explosive materials
By Matt Cortina, Thursday, July 24,2014
Wikimedia Commons/Albert Bridge – Many oil tankers are outdated and unsafe
The library and the post office. A dozen schools. Hundreds of homes. Parks. Every brewery (oh god). Ten gas stations. The wastewater treatment facility. It can all go up in flames at any minute — and that’s just in Longmont. All you’ll hear is a whistle and a boom.
The number of trains carrying crude oil and other volatile materials through Boulder County is increasing, and with it comes the increased risk of a catastrophic explosion — from derailments, from outdated storage tanks and from increased rail traffic.
Perhaps the most startling fact is this: The amount of crude oil on U.S. railways has increased 3,500 percent in the last five years — from 325 million gallons in 2009 to 12 billion gallons in 2013. This is because there is more crude oil to ship out of the Bakken shale formation in North Dakota and — more relevant to Boulder County — the Niobrara shale formation in northern Colorado and Wyoming. In order to meet this demand, railroads and oil distributors are using outdated tank cars (at least more than half of all oil is shipped in these cars) that are not built to carry the more volatile oil that is found in the region and that can explode — and have exploded — from simply overheating.
And yet railroad companies are not required to tell citizens, local or state governments the contents of their cars. It is proclaimed both a matter of national security and industry competitive secrets.
“Railroads are certainly a private industry,” says Greg Stasinos, of the Colorado Department of Public Health and Environment. “That’s something that they can keep within their rights” — even though those same trains are now affecting a much greater area than the rails they ride on.
In the last 12 months alone, nine trains carrying crude oil derailed or exploded in the U.S. and Canada, including a May 10 derailment outside of Greeley that spilled 65,000 gallons of oil. The worst incident by far was the July 6, 2013 derailment in Lac- Mégantic, Quebec. An unattended 72-car freight train carrying Bakken oil ran loose and exploded in the small town’s center. Forty-two people were killed and half the town’s buildings were destroyed.
In the U.S., a 90-car train derailed in western Alabama last November, shooting flames 300 feet into the sky and emptying nearly all of its 2.9 million gallons of crude oil into a swamp.
The area is still being cleaned.
Fortunately, most of those crashes occurred in unpopulated areas — the vast majority of track is located outside of city centers. However, increased output from the nearby Niobrara shale formation will send more oil trains through Boulder County in coming years — the Oil and Gas Journal (an industry magazine) says the Niobrara is emerging and “companies have been busy leasing land for future drilling. It has been compared by some to the Bakken shale formation farther to the north.”
Two rail companies operate the majority of railroads in Colorado: Union Pacific and Burlington Northern Santa Fe (BNSF). Union Pacific does not own rail in Boulder County; instead, they have track heading north out of Denver that bends east through Greeley and up to Cheyenne. BNSF, however, has track that runs northwest from Denver through downtown Louisville and Longmont (and east Boulder) before heading through Fort Collins on its way to Cheyenne.
If a drilling company contracts with BNSF, that cargo — if it’s headed through the Front Range — can only use BNSF rail; that is, it can only come through Boulder County.
Rick Bay
Tracks running next to residential neighborhoods in Old Town Longmont.
Between four and 10 trains carrying Niobrara crude oil will pass through Colorado every week, says Andy Williams of BNSF. Many of those oil trains will pass along the track in Boulder County, according to Boulder Deputy Fire Chief Mike Calderazzo. (A map of Colorado track rights shows that the only full BNSF track in and out of the state runs north and south, including the stretch through Boulder County.) Routes vary greatly, Williams says, depending on where the shipper directs BNSF to deliver materials. Trains that carry crude oil, however, are likely coming from a Niobrara drilling site to a refinery on the Gulf Coast (Colorado is home to only one crude oil refinery, in Commerce City).
It should be noted that railroads, as common carriers, are required under federal law to ship hazardous materials like crude oil. They do not own many of the tank cars (less than 1 percent, according to the Association of American Railroads), or their contents, but they are responsible for its safetransport.
Williams says that BNSF does not make information available to the public about what trains are carrying and where they are going. They do, on occasion, notify local emergency responders like Calderazzo, the Boulder Fire Department and local hazardous materials teams when very large shipments of volatile materials are being transported through the county. Often these notifications come days or weeks after an oil train has passed through the area, or not at all.
“Railroads are very good at maintaining manifests so they know exactly what’s in each car, but I can’t say we receive any information letting us know what goes through each week,” says Mike Selan, Longmont Hazardous Materials Inspector.
“A lot of it is protected for national security reasons,” Calderazzo says. “They’re pretty powerful folks and they can withhold information from regular callers, but they do notify us that there are substantial amounts of crude oil coming through the county.”
In fact, railroads have only one requirement when it comes to notifying state and local government of the trans portation of hazardous materials. It’s a recent emergency order from the U.S. Department of Transportation that calls for railroads to notify state emergency response commissions when they are transporting more than one million gallons of Bakken crude oil. When other crude oil or hazardous materials are transported — as is mostly the case in Boulder County — emergency officials need not be told. And if they are told, that information is confidential and cannot be shared with the public.
“It is sensitive, confidential information,” says Amy Danzl, an emergency management specialist with the Boulder Office of Emergency Management. “We get them straight from BNSF or UP. They consider it trade secret stuff.”
The Colorado Department of Public Health and Environment, not the state emergency management office, manages those notifications. Stasinos, who serves as deputy director of the emergency response division at the state health department, says both Union Pacific and BNSF have sent notifications to the state saying they do not ship Bakken crude oil in Colorado yet.
So the main, and often only, resource that first responders have to prepare for the derailment of an oil train is something called a commodity flow study. These studies are provided by the railroad quarterly or annually upon request of local emergency response teams and list all the materials that have been transported by the company through a specific area in the last year.
Thus, emergency teams can prepare generally for the types of hazardous materials they might encounter in a spill or derailment, but they can’t know beforehand when a train carrying those materials is coming through town.
“We make sure our hazmat teams monitor those so they know generally what comes through,” Danzl says. “So it’s not a day-to-day, here’s what’s coming through the county, but it is, here’s what happened over the last 12 months and that allows us to analyze that and plan accordingly so we can make sure our response capabilities are adequate.”
Those commodity flow studies have indicated to Boulder and Longmont emergency response personnel that crude oil and the cars they’re transported in, although not from the Bakken region, are still major concerns.
“The worst thing that could happen is a crude oil leak and a fire in a derailment,” Calderazzo says. “Then we have to figure out what we do with the smoke, people would have real problems with that, then we need to worry about where the leak is going.
“We look at the county and we look at sensitive environmental areas and sensitive population areas. We haven’t had any incidents in the county [so far] and I don’t really believe we’re under any additional risk other than if it’s true that crude is flowing in greater quantities.”
If the 3,500 percent increase in oil shipments nationally since 2009 and the industry quotes of gold rush-like Niobrara output aren’t enough, Union Pacific’s Mark Davis says of the possibility of increase in northern Colorado oil transportation: “Oh, definitely.” (Then, less succinctly, “We have Niobrara crude moving on us. There’s a couple plants or production facilities that are looking to come online in your neck of the woods.”) The dangerous part of all of this does not lay solely in the fact that the greatest ever quantity of crude oil is now being shipped throughout the country. Instead, perhaps the greatest reason for concern is what this oil is being shipped in.
When you see a train come through town, you’re likely to see one of several car types: crates used to ship commercial goods, racks used to transport cars and big industrial parts, empty beds, etc. Crude oil and other hazardous materials are shipped in a big pressurized black cylinder that dips slightly in the middle, on the top, where the release valve is.
Newer models of this tank are built to carry crude oil, specifically oil from the Bakken and emerging regions like our Niobrara crude, which has been said to be more volatile than oil that was transported in the past. The problem is, the majority of tanks used are the old models (called the DOT- 111), and many people (even the railroad companies) are not confident it is safe to transport this newer breed of crude oil in them.
“The older crude oil tanks were designed for crude oil that did not have a lot of pressure — a lot of vapor dissolved in it,” Calderazzo says. “And I’m told the newer crude, the stuff that’s coming out from fracking, has dissolved gas in it, so the real problem is over-pressurization of tanks. They go down the tracks and overheat.” And then explode.
Eddie Scher, communications director for nonprofit group Forest Ethics, says communities ultimately bear the risk for rail and oil companies who make money sending crude oil in unsafe tanks through population zones.
“If the practice is too dangerous to do then don’t do it,” Scher says. “[The DOT-111] is an antiquated design, it doesn’t protect in derailment, it’s likely to puncture, it doesn’t hold pressure so it releases into the atmosphere. These things are unsafe and shouldn’t be carrying oil of any kind.”
The Department of Transportation urged carriers and oil companies to stop use of DOT-111 cars immediately in May. Out of a total 335,000 tank cars in use across the country, about 228,000 — or two out of every three — are DOT-111 cars, according to the Association of American Railroads.
Williams says that although BNSF does not own the current tanks, they are working to build new, safer tanks to transport crude oil or to retrofit the dangerous old tanks. Every new tank car built since late 2011 has new design features like thicker walls, a high capacity pressure release valve and thermal protection.
But outdated tanks are not the only way in which a train carrying crude oil can cause significant damage to communities. Unprompted derailments, improper exchanges of tanks at depots, leaks, and collisions with other trains and structures have all led to serious explosions within the last 12 months. The issue is also not just the potential harm to people, but previous oil train derailments have caused negative environmental impacts, long-term damage to local infastructure and structural damage. And so adding more oil trains to the rails, specifically in Boulder County where track is narrow and frequently passes through population zones, is cause for concern.
Derailments, spills, leaks and explosions have a much wider impact area than just the immediate vicinity of the railroad (of which, unfortunately, the Quebec derailment was proof). Forest Ethics even put together a map of zones that would be impacted by a derailment and explosion (available at www.explosive-crude-by-rail.org). The map combines data from research, information from railroads and eyewitness accounts with Department of Transportation evacuation areas to create a “blast zone,” or a one-mile area on either side of a track that could experience significant damage from an oil train catastrophe.
This “blast zone” follows the BNSF track in Boulder County. The track parallels Main Street in Longmont before hooking southwest along Foothills Parkway toward Boulder. It breaks sharply east when it gets to about 28th and Arapahoe in
Boulder, then slowly crooks south through downtown Louisville, just scraping the edge of Lafayette. Again, the Department of Transportation views anything within a mile on either side of that route as a hazardous area should a derailment occur.
Planning to deal with an unknown material at an unknown time that could affect an unknown amount of people with an unknown amount of state or rail support cannot be easy. Boulder County, City of Boulder and City of Longmont officials all say they have been trained on how to deal with a variety of hazmat situations, but that they can’t prepare for everything. In fact, many local officials were still unclear about who would notify them in the case of a crude oil disaster and if crude oil was even being transported in the area.
“We can’t plan for every single [situation],” Calderazzo says.
“One tank car, depending on the product, can be a pretty big deal. Take chlorine. Chlorine, if it’s the anhydrous kind, can take just one tank car [to create major damage]. So we look at what are the most cars coming through — we only need [that information] on an annual basis. We try to go with, well, if crude oil is the big commodity then what would we do in terms of a risk assessment of crude oil?” There are regulations on what can and cannot be transported via rail and how rail companies must mark cars that contain hazardous materials. For instance, train cars carrying crude oil will have the number 1267, called a UN number (based on UN standards) on all four sides of the car and a diamond shaped warning label. Cars containing chlorine will have the number 1017, while those with liquefied petroleum gas will have the number 1075. Other hazardous materials that are transported in the area like molten sulfur, ethanol, propionic acid and diesel also have corresponding numbers available on the Department of Transportation website. (Williams says BNSF “typically [does] not operate ethanol trains in Colorado.”) Stasinos says that, at the state emergency level, training for spills with Bakken or Niobrara crude oil is the same as it is for other types of oil spills, even though it is likely more volatile than other crude oil. This training has been in place for more than two decades, he says.
That training includes a hazmat certification program run by the state that all local emergency personnel in Boulder County are required to take. Emergency personnel are drilled on how to treat all types of rail cars, learning what to do if there’s a leak, how to contain it, what to do if there’s a fire, projection modeling and how to protect people in the “blast zone.”
Oil train safety is also on the mind of state and national officials — the U.S. Fire Administration sent out a one-sheet “Coffee Break Training” entitled “Bakken Crude in Transportation” last month, while the EPA’s latest newsletter outlines the rise and risk of transporting crude oil. The newsletter heralds the recent Department of Transportation notification requirement as a step to improved community safety and encourages rail carriers to test all crude oil to determine its volatility class before shipping it.
Even BNSF is now offering three-day classes to local emergency responders on how to deal with crude oil disasters. BNSF runs free railroad hazmat response training to about 4,000 local emergency responders every year in communities across their network.
Still, advocates seeking to bring attention to the danger of oil trains say communities shouldn’t have to deal with the risk of catastrophe from a derailment. Scher says the choice of transporting oil via train or via pipeline — of which both have significant safety issues — or via any other method is a “false choice.”
“The idea that the oil has to be moved and so somebody needs to be forced to take the risk is wrongheaded,” Scher says. “It’s not something we should have to accept. We should not be accepting this massive rise of dangerous trains through our population centers. There are regulations under review at the White House; we want those to be strong. And one thing we believe is communities should have the right to say no to these trains.”
