[Note from BenIndy: It is fascinating how hard it is to find and pin down good coverage of industrial accidents – especially refinery fires, plant explosions, and so on – when they occur in Texas. We have Common Dreams and ABC13/KTRK in Texas to thank for their coverage today. Perhaps more information about the source of the fire, the danger the toxic smoke and particles in the air in Shepherd may pose, and any additional impacts will be made more available tomorrow. From one refinery town to another, Benicia surely sends Shepherd its heartfelt hopes for a speedy recovery for the town, a thorough investigation of the root causes for this absolutely heinous disaster, and the creation of additional protections for the safety and health of its residents.]
The explosion resulted in a massive fire as residents in and around the town of Shepherd were ordered to stay inside and turn off their HVAC systems to avoid contact with the toxic smoke and particles in the air.
At least one worker was reported injured and the surrounding community placed under a shelter-in-place order after an explosion at a chemical plant in the town of Shepherd, Texas on Wednesday resulted in a monstrous and toxic fire.
Roughly 60 miles north of Houston in Jacinto County, the explosion and subsequent chemical blaze took place at the Sound Resource Solutions facility, a petroleum processing plant. A source told ABC 13 News that a 1,000-gallon propane tank sits in the middle of the fire while various highly flammable toxic chemicals and materials are used at the plant.
Shelter-in-place order issued after chemical plant explosion in Shepherd, Texas; smoke visible for milespic.twitter.com/0krc7baQlk
“Polk County Emergency Management recommends that residents along US Hwy 59 from Goodrich to Leggett shelter-in-place and turn off HVAC systems in homes and businesses immediately,” said a local emergency response from officials in neighboring Polk County. “At this time, the effects of the chemical in the air are unknown.”
According to the Sound Resource Solutions website, the chemical products and solvents used or generated at the processing plant include: xylene, toluene, acetone, methy ethyl ketone, phosphoric acid, acetic acid, sulfuric acid 93, various isoproply alcohols, hexan, and others.
Local affiliate Fox 26 was providing live coverage:
There is no confirmed information about the cause of the fire, though some local outlets reported talking with workers who said a forklift accident may have been the initial cause that set off a larger chain reaction.
US crude has negative value for first time in history as stockpiles overwhelm storage facilities
The Guardian, by Jillian Ambrose and Martin Farrer, April 20, 2020
US oil prices turned negative for the first time on record on Monday as North America’s oil producers run out of space to store an unprecedented oversupply of crude left by the coronavirus crisis.
The price of US crude oil collapsed from $18 a barrel to -$38 in a matter of hours, forcing oil producers to pay buyers to take the glut of crude which they cannot store, as rising stockpiles of crude threaten to overwhelm oil storage facilities.
“The problem of the global supply-demand imbalance has started to really manifest itself in prices,” said Bjornar Tonhaugen, head of oil at research firm Rystad Energy. “As production continues relatively unscathed, storages are filling up by the day. The world is using less and less oil and producers now feel how this translates.”
The Guardian reported over the weekend that a record 160m barrels of oil was being stored in “supergiant” oil tankers outside the world’s largest shipping ports, including the US Gulf, following the deepest fall in oil demand in 25 years because of the coronavirus pandemic.
The last time floating storage reached levels close to this was in the depths of the financial crisis in 2009, when traders stored more than 100m barrels at sea before offloading stocks when the economy began to recover.
The price collapse in US oil market – known in the industry as the West Texas Intermediate price – accelerated because it is the last day oil producers can trade barrels that are scheduled for delivery next month, when oil storage is expected to reach capacity.
The US price for oil delivered in June, which will become the default oil price from tomorrow, is also falling due to the economic gloom caused by the coronavirus, but has managed to remain above $20 a barrel. On Monday the price for brent crude, the most widely used benchmark, fell 8% to $25.79.
Cailin Birch, global economist at the Economist Intelligence Unit, said: “US crude oil production has begun to fall in the last two weeks, and will continue to fall in the coming months as already heavily indebted shale firms scale back activity or are forced into bankruptcy or consolidation.”
Despite the historic production cuts, most analysts believe that oil prices will fail to reach the same price levels recorded at the beginning of the year before the outbreak. The global oil price, under the brent crude measure, reached highs of almost $69 a barrel in January before plummeting to less than $23 a barrel at the end of March.
U.S. railroads push against oil industry demands for storage in rail cars
Reuters, by Devika Krishna Kumar, Laura Sanicola, April 9, 2020
NEW YORK (Reuters) – Railroads are clamping down on rising demand from oil companies to store crude in rail cars due to safety concerns, sources said, even as the number of places available to stockpile oil is rapidly dwindling.
Oil demand is expected to drop by roughly 30% this month worldwide due to the worsening coronavirus pandemic, and supplies are increasing even as Saudi Arabia and Russia hammer out an agreement to cut worldwide output. Storage is filling rapidly as refiners reduce processing and U.S. exports fall.
Globally, storage space for crude could run out by mid-2020, according to IHS Markit, and most U.S. onshore storage capacity is expected to fill by May, traders and analysts said.
However, railroads including Union Pacific and BNSF, owned by billionaire Warren Buffett, are telling oil shippers that they do not want them to move loaded crude trains to private rail car storage facilities on their tracks due to safety concerns, three sources in the crude-by-rail industry said.
The railroads are telling clients that tank cars are not a prudent long-term storage mechanism for a hazardous commodity such as crude, and do not want to put a loaded crude oil unit train in a private facility and potentially create a safety hazard, they said.
Federal rules typically only allow crude in rail cars to be stored on private tracks. There is no federal data on how much oil is regularly put in rail storage, but analysts said it is very little.
“Most federal regulations require rail cars loaded with … crude oil to be moved promptly within 48 hours. Therefore, federal regulations discourage shippers and railroads from leaving crude oil in transportation for an extended time,” transportation lawyers at Clark Hill LLC wrote in an article Thursday.
BNSF did not respond to several requests for comment. Union Pacific declined to comment.
Nearly 142 million barrels of crude moved via rail in the U.S. in 2019, representing about 10% of what is transported via pipelines, according to the U.S. Energy Department. Unit trains, made up entirely of tank cars, can carry around 60,000-75,000 barrels.
Even on smaller or mid-sized railroads, known as shortlines, there may be capacity constraints or insurance coverage may not be adequate, the railroads have said, advising rail companies not to store oil.
“It is arbitrary, and is happening at a time when it (storage) is an option being heavily considered by all companies that have access to crude by rail right now,” one of the sources said.
As of September, there was enough crude storage capacity in the U.S. for about 391 million barrels of out of about 700 million working capacity, excluding the strategic reserve, according to the U.S. Energy Department. However, U.S. stocks have risen by 32.5 million barrels in just the last 4 weeks, including a 15-million-barrel gain in the latest week, the most ever.
Crude-by-rail shipments were not economic when oil prices were high but are expected to rise as prices have plunged. Loadings out of the Permian basin, the biggest in the country, slumped to about 12,500 barrels per day (bpd) in January, the lowest in at least a year, before rising to about 13,200 bpd in February, according to data from Genscape.
Demand is falling so swiftly that rail cars loaded with crude may not be accepted by the time they reach their destination three-to-five days later, leaving barrels orphaned without a storage option, one trader said.
Rates to lease rail cars have dropped sharply due to the crash in oil prices, making them more attractive for storage. Lease rates for rail cars have fallen from about $800 per month to about $500, said Ernie Barsamian, founder and CEO of The Tank Tiger, a terminal storage clearinghouse.
Reporting by Devika Krishna Kumar, Laura Sanicola and Laila Kearney in New York; Editing by Chris Reese
To Deer Park residents, fire a reminder of ‘like living on a fault line’
Samantha Ketterer and Emily Foxhall March 18, 2019 Updated: March 18, 2019 4:37 p.m.
Jodie Thompson pulled over on Independence Parkway, less than a mile away from a petrochemical plant that was leaking plumes of black smoke into the sky.
In her 34 years living in Deer Park, she’d seen flares before. But this was different.
“I trust that they actually know what they’re doing, but inside, I have this doubt,” Thompson said Monday afternoon, watching the flames from inside the safety of her car.
The fire had raged at Intercontinental Terminals Company for more than 26 hours by the early afternoon and spread to eight holding tanks. Even after a shelter-in-place was lifted Monday morning, the fire was still expected to burn for two more days.
The ordeal, in some ways, was part of life in Deer Park, an east Harris County city of more than 33,000 people. Residents said they were familiar with the risks that come with living by the refineries and chemical plants. At a certain point, you have to stop worrying, they said.
“You can’t fret about it,” said Thompson, who is 60. “What are you going to do? You choose to live here.”
Holly Ball, 47, is a newer resident to Deer Park, having lived in the city for just a year. She’s noticed the puffing smoke stacks at the refineries, of course, but wasn’t aware of a threat like this, she said.
Like Thompson and many other residents on Monday, Ball parked her car to take photos of the smoke spreading miles west into Houston. She planned to send them to her friends in Louisiana.
“It’s scary,” she said. Her dog barked in the seat next to her. “It’s scary.”
On Facebook, people responded to official updates with more questions. They wanted to know more about what exactly was happening and what the risks were to their health.
Would the city of Deer Park be evacuated? Was it possible the plant would explode? The shelter-in-place had been in Deer Park, but what about people in the close-by city of Pasadena? And in La Porte?
Some people wrote of alarm sirens that should have gone off but haven’t worked for some time. Even with the shelter-in-place lifted, looking up at the sky, it was hard for many to believe air quality was fine. Some wrote of symptoms they were experiencing.
One person said she had trouble breathing overnight. Two others wrote of burning sensations in their eyes. Another person decided to leave the area because their child was having trouble breathing. Some said they were simply nervous to sleep.
Bernice Oehrlein, 78, pushed a cart in the morning through the Food Town grocery store in Deer Park, about 5 miles southwest of the plant. She recently had a bad bout with pneumonia, so the fire is concerning for health reasons, she said.
“I have a hard time breathing anyways,” Oehrlein said.
At a Starbucks just down the road, Cindy Richards and her daughter drank coffee instead of going on their normal Monday walk.
Richards, a 67-year-old who lives in Pasadena, recalled the drive to Deer Park, before she realized a fire had clouded up the sky.
“I was like, ‘It’s a little overcast,'” she said. But then, “I come a little closer – ‘That’s smoke.'”
Richards doesn’t pay too much attention to the factories anymore, although she said they used to be more top-of-mind when she lived off of Sims Bayou, closer to some of the refineries.
Her daughter, 35-year-old Robyn French, lives close to the plant in Deer Park with her husband and two children. Flares, smoke and a gassy smell have become a normal occurrence, and she knows what to do in the case of an explosion.
But French knew better than to ignore the smoke on Monday, even though she said she felt fairly safe.
She made sure Sunday and Monday that her son wasn’t outside on his bike, breathing in anything possibly dangerous. And the unknown is still concerning.
“Am I still able to eat the Swiss chard and kale I’m growing in my garden?” she asked. “That’s a valid question to me. Will my oranges be full of chemicals when they’re full grown?”
Heather Trevino, 42, grew up in Deer Park and lives there now with her 9-year-old daughter. She said she had taken shelter before, but didn’t recall an incident as long and intense as this one.
Trevino saw the smoke rising above her neighbor’s roof Sunday. Her eyes and throat itched. When she got the alert to shelter-in-place, she knew to bring in her two dogs and shut off the A/C.
Trevino faintly heard the sound of the alarms that she said are tested every Saturday at noon. She put on some movies for her daughter, who also learned in school what to do when a shelter-in-place was ordered.
“We kind of get it ingrained in us,” Trevino said. “Living here, it’s just kind of part of what you accept, that there’s something that could possibly happen.”
Thompson likened it to an earthquake-prone area.
“It’s probably like living on a fault line,” she said. “It doesn’t happen very often, but the possibility is always there. In the back of your mind, you push it back. It’s out of your control.”
Anthony, a 36-year-old who works at a nearby plant, said he had to take the day off because of his workplace’s proximity to ITC. He declined to give his last name because of his employer.
While Anthony said he didn’t believe the air quality in the area is particularly bad because of the incident, he’s still concerned of the possibility of an explosion.
“It’s not anything that can really be taken lightly,” he said. “There is a flash point.”