Regulators hike restrictions for oil trains

HOUSTON — Regulators ratcheted up restrictions for oil trains in an emergency order on Tuesday, requiring crude from North Dakota and elsewhere to be tested before it is shipped by rail.

The Department of Transportation’s emergency order was the fourth issued in the last year because of derailments of trains carrying crude. It will require oil shippers to test crude oil in order to categorize it in one of the two highest risk groups of hazardous materials.

Higher risk materials have lower flash points and boiling points. Recent derailments of trains carrying crude, including one in Lac-Megantic, Quebec that killed 47 people, involved crude oil that was inappropriately labeled as a lower risk material, according to Canadian authorities.

“Today we are raising the bar for shipping crude oil on behalf of the families and communities along rail lines nationwide — if you intend to move crude oil by rail, then you must test and classify the material appropriately,” Department of Transportation Secretary Anthony Foxx said in a written statement. “And when you do ship it, you must follow the requirements for the two strongest safety packing groups.”

Rail: Vulnerable train tank cars will keep carrying crude

Classifying hazardous materials in high-risk categories ensures that they are packaged properly and helps alert firefighters to the risks involved with cargos.

“This is essential to ensuring first responders are able to safely and appropriately respond in the event of an accident or incident,” the American Association of Railroads said in a statement on the order.

Weak oil cars

The department’s executive order came a day before the House Railroads, Pipelines and Hazardous Materials Subcommittee holds a hearing on rail safety.

The American Petroleum Institute, the oil industry’s lobbying group, said it was reviewing the order and working with railroads and regulators to improve safety.

“It is our top priority,” the group said in a statement.

Regulators have warned that crude from the Bakken region may be more flammable than heavier types of crude. Researchers say the light quality of crude from the Bakken shale contains more molecules that can easily become gaseous and ignite in the case of a derailment.

While the regulations address labeling concerns related to Bakken crude, many of the tank cars that move the oil are weak and outdated, making them vulnerable to being punctured in the case of a derailment.

The National Transportation Safety Board, railroad groups and oil companies have pressed for updated regulations that require the cars to be upgraded or retired. The American Association of Railroads has said the cost of those upgrades could exceed $1 billion, however, and regulators have not said if they would require the step.

Some companies have pursued new and upgraded cars regardless of the regulations. Houston-based Phillips 66 says its entire fleet of more than 2,100 rail cars moving crude are new models that have thicker walls and stronger head shields to prevent punctures. Other companies, like Valero and Tesoro, have also signed on for new tank cars.

Shipments of crude by rail have played a major role in the surging Bakken Shale play of North Dakota. Production in North Dakota has soared from 90,000 barrels of oil per day at the start of 2005 to 923,000 barrels a day in December 2013, according to the most recent data from the state.


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