Category Archives: Rail routing

Farming, Oil Industry, Rail industry, Rail routing, Traffic

Farmers: Oil trains may delay fertilizer shipments

Repost from Ag Week

Oil traffic could delay US fertilizer shipments, farmers warn

Increasing use of railroads to ship crude oil could disrupt fertilizer cargo this spring as Midwest farmers prepare for planting, U.S. agriculture leaders warn, even as one railroad said on Monday it will take steps to ensure timely deliveries.
By: Reuters, April 15, 2014

WASHINGTON — Increasing use of railroads to ship crude oil could disrupt fertilizer cargo this spring as Midwest farmers prepare for planting, U.S. agriculture leaders warn, even as one railroad said on Monday it will take steps to ensure timely deliveries.

The planting season is nearly at hand in states such as the Dakotas and Minnesota, where soybean, wheat and corn growers will lay millions of tons of fertilizers like nitrogen and potash that mostly arrive by train.

Those supplies are not stockpiled near the fields and the farmers rely instead on steady deliveries by rail.“

Since we don’t store fertilizer, the next very few weeks are incredibly important for South Dakota farmers,” said state Agriculture Secretary Lucas Lentsch.

But fertilizer cargo is being waylaid as railroads are clogged by trains carrying crude and other freight and that could ultimately jeopardize the fall crop, farmers have warned lawmakers and other officials.

“If rails are too congested for fertilizer in the weeks ahead, the problem will solve itself because there won’t be anything to harvest in the fall,” said Dave Andresen of Full Circle Ag, a farm services company in South Dakota.

BNSF Railway Co. said on Monday it had assigned more locomotives and train crews to expedite fertilizer deliveries so nutrients can arrive at delivery points on time.

“We understand the shortness of the season and the necessity of timely delivery,” the rail operator said in a notice to farm customers.

CHS Inc., a top farm supplier in the Upper Midwest, expects to help meet near-term demand for nutrients but is concerned supplies could dwindle a little later in the growing season.

“In the early weeks of planting, farmers need a recharge and the fertilizer sheds need to be stocked up before then,” said Jeff Greseth, the company’s head of crop nutrition.

Supply lines have been snarled in part by clearing grain bins of the remainder of last year’s crop and recovering from harsh winter weather.

Barges ferrying dry fertilizer on the Mississippi River and into Minnesota have found some waterways frozen over for longer than normal, Greseth said.

“The ice has some deliveries running a week, 10 days late,” he said, but an increase in oil-by-rail traffic has also weighed on the train network.

Rail shipments of crude oil have been on the rise in North Dakota’s Bakken energy patch, where production is nearing 1 million barrels per day, and roughly 72 percent of that fuel moves on the tracks.

Last week, farmers beseeched federal officials to make sure rail operators such as BNSF and Canadian Pacific Railway Co were giving them enough access to the tracks.

The Surface Transportation Board, a regulatory agency that arbitrates rail disputes, has heard from farmers across the upper Midwest that a shortage of rail cars and delivery delays were endangering their livelihoods.

BNSF executives have said service will improve in the years ahead along with investment and an expected uptick in farm, crude oil and other commodity shipments.

Bakken Crude, Crude Oil, Environmental Impacts, Federal Regulation (U.S.), Lac-Mégantic, Public Safety, Rail accidents, Rail routing, Rail Safety, Rail tanker cars, Spill prevention and response

Flawed tests play down crude oil’s explosiveness

Repost from The Toronto Globe and Mail

Flawed tests play down crude oil’s explosiveness

KIM MACKRAEL
OTTAWA — The Globe and Mail
Published Monday, Apr. 07 2014

Damaged rail containers and twisted wreckage can be seen on the main road through downtown Lac Mégantic, Quebec early July 7, 2013, a day after a train carrying crude oil tankers derailed and burst into flames. (Moe Doiron/The Globe and Mail)As Canada and the United States move to strengthen the rules for transporting crude oil by rail, there is mounting evidence that regulators are relying on tests that underestimate the risk of a fiery explosion like the one that destroyed Lac-Mégantic.

The current testing regime was not designed for unrefined crude and, as a result, can play down the dangers of shipping some light crude oils, according to industry and transportation experts. A United Nations panel on hazardous materials shared similar concerns last week when it announced that it would review international standards for shipping crude oil, including how crude is tested and classified, in response to a string of recent accidents in North America.

With the accuracy of the tests in question, there is suspicion that some shipments of Bakken crude may be more volatile than officials believed. It also raises the possibility that light crude oil drawn from other locations in North America is as potentially explosive as crude from the Bakken – but has not been receiving the same level of scrutiny.

The devastating fire in Lac-Mégantic, Que. last July, began when a train carrying Bakken crude jumped the tracks and exploded in the centre of the small town, killing 47 people. A Globe and Mail investigation showed that oil from the Bakken formation, which straddles North Dakota, Saskatchewan and Manitoba, is more volatile and prone to exploding than conventional forms of crude.

Crude oil with a high concentration of light ends – such as methane and propane – is “most at risk” of being mischaracterized in standard testing procedures, according to a recent report commissioned by Transport Canada. Those light ends are potentially dangerous because they can ignite and magnify the size of an explosion.

The inaccuracies underscore how little is known about the risks of shipping crude oil by rail, a practice that has increased dramatically during the past five years and now accounts for an estimated 230,000 barrels of oil a day in Canada. Oil is widely known to be flammable, but regulators did not believe until recently that it had the potential to explode and cause the kind of destruction it did in Lac-Mégantic.

Flash point and boiling point tests, which are required for crude shipments in Canada and the U.S., both have difficulty measuring samples that contain significant concentrations of light ends, according to the report to Transport Canada. Another common test, known as the Reid Vapour Pressure test, has also been criticized for use on crude oil because it can allow light ends to easily vapourize at the time samples are collected from highly volatile crude.

“When you try to apply [current tests] to samples that have light ends, they don’t work as well,” said Bob Falkiner, a director for the Canadian Crude Quality Technical Association who also works for Imperial Oil. “You get biased results reported from those test methods because of the lost light ends.”

A spokesperson for Transport Minister Lisa Raitt said the minister is aware of concerns about the crude-testing regime and Transport Canada is “looking at options” related to volatility tests. Speaking with The Globe after an event in Toronto last week, Ms. Raitt also welcomed the UN panel’s decision to study crude shipments and testing.

Producers in the Bakken are expected to stabilize crude oil before shipping it, in a process meant to remove many of the light ends from the rest of the product. Those light ends can be sold separately, but limited transportation infrastructure in the fast-growing Bakken area has led some producers to flare the products instead – which means they simply burn them on the spot. In some cases, flaring has become a “de facto stabilization process,” said Bill Lywood, founder and president of Crude Quality Inc.

However, several industry experts said there is a financial incentive for producers to leave some light ends in the crude – rather than burning them off or selling them separately – because they can increase the overall volume of the crude they are selling. At the same time, because of testing limitations, it can be difficult for producers, shippers and buyers to determine whether enough of the volatile light ends have been stripped away before crude oil is transported across the country.

In an effort to address the problem, some companies and industry experts are advocating the use of a newer vapour pressure test that uses a sealed, pressurized cylinder to prevent light ends from escaping when a sample is taken.

Bakken Crude, California Energy Commission, California Regulation, Local Regulation, Rail routing, Tar sands crude, WesPac Energy

Oil Shipments Turn Albany Into “Houston on the Hudson” As Communities Across Country Fight Oil-By-Rail Proposals

Oil Shipments Turn Albany Into “Houston on the Hudson” As Communities Across Country Fight Oil-By-Rail Proposals (via Desmogblog)

Thu, 2014-03-27 04:18Justin Mikulka Due to a massive increase in the movement of crude oil by rail in the past few years, communities across the country are facing the daunting prospect of becoming part of the oil industry’s infrastructure. In Pittsburg…

Federal Regulation (U.S.), Rail industry, Rail routing, Rail Safety

Ohio: Leaders don’t keep track of oil trains

Repost from The Bucyrus Telegraph, Bucyrus, Ohio

Leaders don’t keep track of oil trains

Explosive shipments go right through city centers

Apr. 3, 2014
by James Pilcher, The Cincinnati Enquirer

Domestic oil production, including that in Ohio, keeps growing. And with oil being produced in new areas that don’t have pipelines, more crude is heading to refineries in rail cars. Yet neither federal nor state regulators track the shipments that are increasingly crisscrossing the country — potentially cutting through neighborhoods and business districts nationwide.

Much of the oil apparently is more volatile than traditional crude, with some experts saying it is as explosive “as gasoline.” A number of oil tanker accidents and explosions made headlines last year, including last July’s derailment and explosion in  Quebec that killed 47 people and all but leveled a small town. The train was pulling at least a dozen tank cars carrying crude pulled from Bakken shale deposits.

Similar types of oil are being pulled from shale fields all over the U.S., including eastern Ohio, western Pennsylvania and North Dakota.

“Regulators across North America simply have not kept up with the boom in moving oil by train,” said Keith Stewart, a Canadian-based researcher for the environmental group Greenpeace. “You would be shocked how little governments know how much and where and when this oil is moving by rail.”

Federal regulators don’t know what is  on the tracks at any given time. Nor do first responders and community officials, apart from getting a list of the top 25 hazardous materials that move through their communities. But because of security concerns, local officials can’t make the top 25 lists public. Railroads must keep a list internally, but those records also are not public.

The lack of disclosure could pose a problem for a city such as Cincinnati, which has one of the Midwest’s largest railyards in CSX-owned Queensgate, which sits near downtown.

“All kinds of hazardous materials go through (Queensgate) and no, we’re not notified of what is going through when,“ said Cincinnati Fire Department District Chief Tom Lakamp, who oversees special operations and hazardous materials response teams for the city.

The federal Pipeline and Hazardous Materials Safety Administration oversees the shipments of all hazardous materials, including crude oil, superseding state regulators for rail shipments. The agency did not make anyone available for interviews, but said in a statement that it was starting to look at changing its rules and was taking a closer look at oil shipments.

All that’s called ‘crude’ is not necessarily the same

The United States is poised to become the world’s largest combined producer of natural gas and crude oil in the coming year, according to federal data, which  indicate the country produced 7.5 million barrels of oil a day last year. Oil industry officials saying national production has been above 8 million barrels per day since November.

Ohio is a part of that growth, because of the wells in the eastern part of the state pulling up oil and natural gas from Utica shale reserves. The state produced 16,000 barrels of oil a day last year, up more than 23 percent from 2012.

But even as oil production has grown, pipeline infrastructure hasn’t kept pace. That’s forced oil producers and refiners to turn to rail shipments, especially in remote areas such as North Dakota, but also in Ohio. The railroad industry reports that crude oil shipments nearly doubled in 2013 as compared with 2012, with the American Association of Railroads estimating that more than 400,000 tank loads of crude arrived by rail last year.

A single tank car holds about 714 barrels of oil, and each barrel contains 42 gallons, meaning every tank car contains 30,000 gallons of oil. But an Ohio oil industry official says the majority of what’s called oil produced and shipped in the state is “ very volatile” and “basically liquified natural gas,” even as he points out that Ohio oil has been pumped and shipped safely for decades.

“It is still classified as crude oil, even thought it is a lot closer to gasoline,” said Tom Stewart, executive vice president of the Ohio Oil and Natural Gas Association. “The bottom line is that it should be treated differently than other crude oil.”

Stewart says most of Ohio’s oil is shipped out of state — although refineries in the state are starting to take on this volatile oil.

Finally, the oil is being shipped in outdated tanker cars. The National Transportation Safety Board started recommending in 1991 that oil companies stop using the older model of tanker because they have proven not to prevent spillage and explosions in case of derailments. It renewed its call this January.

“You’ve got one of the most profitable industries in the world looking to save a few dollars at the cost of safety,” said Fred Millar, a Virginia-based rail/hazmat safety consultant who has worked with major cities on safety planning.

Issue creates tensions; changes on the way?

Tension abounds between the oil and rail industries over the shipments, even as railroads court oil producers as customers.

Many carriers — including CSX and the Genesee & Wyoming railroad — actively market their capacity to oil producers. But on the other hand, national railroad officials openly acknowledge differences with the oil industry over safety standards.

“The shippers own the cars and the materials and are responsible for safe packaging and labeling, but we’re the ones liable in case of an accident,” said Holly Arthur, spokeswoman for the American Association of Railroads.

The rail industry last month agreed with the U.S. Transportation Department to voluntarily impose tighter procedures, including:

•  Installing better brakes on trains with 20 or more oil cars.

•  Limiting speeds to 40 mph on trains with 20 or more rail cars in highly populated areas.

•  Increase track inspections on lines that carry trains with heavy oil traffic.

Oil industry officials say they also are trying to improve safety, but have not yet agreed to any specifics. “Our mitigation efforts are looking at topics like tank car design and crude oil testing and classification,” said Jack Gerard, president and chief executive officer for the American Petroleum Institute.

As for the regulators, PHMSA is studying new variations of the domestically produced oil and its potential volatility. It’s also double-checking that domestic oil is property categorized and shipped.