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Making Oil-by-Rail Safer

Oil Rail Safety

  • A series of rail accidents involving trains carrying crude oil has focused attention on safety procedures and even the tank cars used in this service.
  • Another concern is the variable characteristics of the “light tight oil “now shipped by rail in large quantities. That isn’t the result of “fracking”, but of the oil’s inherent chemistry.   

The growth of North American oil production from unconventional sources has resulted in a dramatic expansion in the volume of crude oil shipped by rail. Unfortunately, as crude oil rail traffic has increased, so have rail accidents involving crude oil, including the tragic explosion and fire in Lac-Megantic, Quebec last July. That event and subsequent accidents have focused railroads, regulators and shippers on the need to improve the safety of oil-by-rail as quickly as possible.

In the immediate aftermath of Lac-Megantic, the Federal Railroad Administration issued an emergency order on procedures railroads must follow when transporting flammable and other hazardous materials. And on February 21, 2014 railroads reached a voluntary agreement with the US Department of Transportation (DOT) on additional steps, including reduced speed limits for oil trains passing through cities, increased track inspection, and upgraded response plans. These steps have the highest priority, because crude oil loaded in tank cars doesn’t cause rail accidents. Every incident I’ve seen reported in the last year began with a derailment or similar event.

At the same time, the packaging and characteristics of the oil can affect the severity of an accident.  Investigators have focused on two specific issues in this regard, starting with the structural integrity of the tank cars carrying the oil. The vast majority of tank cars in this service are designated as DOT-111–essentially unpressurized and normally non-insulated cylinders on wheels. These cars routinely carry a variety of cargoes aside from crude oil, including gasoline and other petroleum products, ethanol, caustic soda, sulfuric acid, hydrogen peroxide, and other chemicals and petrochemicals.

Their basic design goes back decades, and even the older DOT-111s incorporate learnings from earlier accidents. A growing proportion of the US fleet of around 37,000 DOT-111 tank cars in oil service consists of post-2011, upgraded cars that have been strengthened to resist punctures, but the majority is still made up of older, unreinforced models. The Pipeline and Hazardous Materials Safety Administration (PHMSA) is studying whether to make upgrades mandatory, but some railroads and shippers aren’t waiting. Last month Burlington Northern Santa Fe Railway, owned by Warren Buffet’s Berkshire Hathaway, announced it would buy up to 5,000 new, more accident-resistant tank cars.

Another issue that has received much attention since Lac-Megantic concerns the flammability of the light crude from shale formations like North Dakota’s Bakken crude, which accounts for over 700,000 barrels per day of US crude-by-rail. The Wall Street Journal published the results of its own investigation, reporting that Bakken crude had a higher vapor pressure–a  measure of volatility and an indicator of flammability–than many other common crude oil types.

The Journal apparently based its findings on crude oil assay test data assembled by the Capline Pipeline.  Although a Reid Vapor Pressure of over 8 pounds per square inch (psi) for Bakken crude is higher than for typical US crudes, it’s not unusual for oil as light as this. That’s especially true where, due to lack of field infrastructure, only the co-produced natural gas is separated out, leaving all liquids in the crude oil stream.

What makes this situation unfamiliar in the US is that domestic production of oil as light as Bakken had nearly disappeared before the techniques of precision horizontal drilling and hydraulic fracturing were applied to the Bakken shale and similar “source rock” deposits. (Note: High vapor pressures are characteristic of the naturally-occurring mix of hydrocarbons in very light crudes, rather than a result of the “fracking” process.) Nor is the reported vapor pressure for Bakken or Eagle Ford crude higher than that of gasoline, a product that is federally certified for transportation in the same DOT-111 tank cars that carry crude oil.

The variability of the vapor pressure data that the Journal’s reporters identified for Bakken crude may result from another unfamiliar feature of such “light tight oil”. Crude produced from conventional reservoirs, which are much more porous than the Bakken shale, tends to be relatively homogeneous. However, because the Bakken and other shales are so much less porous, limiting diffusion within the source rock reservoir, the composition of their liquids can vary much more between wells.

In any case, vapor pressure isn’t the preferred measure of fuel flammability. Actual rail cargo classifications are based on flash point and initial boiling point. These routine quality tests aren’t included in Capline’s publicly available data. PHMSA initiated “Operation Classification” to ensure that manifests and tank car placards for crude oil shipments accurately reflect the potential hazards of each cargo, based on such measurements. The agency has determined that it hasn’t always been done consistently, and DOT issued another emergency order requiring shippers to test oil for proper classification.

As mentioned in an oil-by-rail webinar yesterday, hosted by Argus Media, assigning the proper classification to oil shipments may seem like a bureaucratic concern–it doesn’t necessarily affect the tank car type chosen to transport the crude–but it can have a significant impact on operational factors such as routing and the notification of first responders along the route.

There’s no quick and simple way to make the transportation of crude oil by rail as safe as hauling a dry bulk cargo like grain. Tank car fleets can’t be replaced overnight, not just because of the cost involved, but due to limited manufacturing capacity. However, in the meantime significant improvements can be achieved through a combination of government attention and sustained industry initiatives. Since the new crude streams traveling by rail play a key role in increasing North America’s energy security, this is in the interest of everyone involved–producers, shippers, railroads, and not least the communities through which this oil travels.

A different version of this posting was previously published on the website of Pacific Energy Development Corporation.

Photo Credit: Oil Transport Safety/shutterstock

Geoffrey Styles's picture

Thank Geoffrey for the Post!

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Bob Meinetz's picture
Bob Meinetz on Mar 24, 2014 4:18 pm GMT

Geoffrey, I find your emphasis on who’s responsible for tanker safety an interesting one. You write:

There’s no quick and simple way to make the transportation of crude oil by rail as safe as hauling a dry bulk cargo like grain. Tank car fleets can’t be replaced overnight, not just because of the cost involved, but due to limited manufacturing capacity.

I wonder what the NHTSA’s response would be to an automaker facing a recall for a safety defect, coming up with a similar excuse. Also:

Since the new crude streams traveling by rail play a key role in increasing North America’s energy security…

While this talking point has found favor on conservative talk radio, what evidence do you have that Canadian oil traveling to port for refining and export on the world market has any effect on America’s energy security?

As positively fixated and single-minded as oil companies are about getting their product to market before any kind of oversight creeps in – it’s their responsibility, and the rail lines which serve them, to ensure it can be done safely. What role does speed play in this new spate of accidents? Of increased track fatigue due to forty-two times the number of maximum-load, 286,000 lb. tank cars traveling these lines as recently as 2009?

Instead of reducing speed, or looking into the possibility of overloaded cars or degraded track beds, the industry’s response is to post signs on the cars saying something akin to “This Car is Carrying Something Flammable Which May Explode Violently, Or Poison Your Waterways”. In other words: “The oil is coming through. Get out of the way.”

 

Geoffrey Styles's picture
Geoffrey Styles on Mar 24, 2014 8:56 pm GMT

Bob,

For starters, I don’t parrot talking points; I’ve been writing about energy security from my own perspective for many years. As for exports, only a small portion of shale production is currently exported. Under existing regulations, the only allowed destination for it is Canada. Such exports averaged 120,000 bbl/day last year, or only about 4% of current light tight oil produciton. In energy security terms, rising LTO production–much of it carried by rail–accounts for about 60% of the roughly 5 million bbl/day reduction in US net oil imports since 2008, with the weak economy and energy efficiency gains accounting for the rest. Meanwhile, the small quantity currently exported still contributes to economic security, by reducing our trade deficit by around $4 B/yr, on top of the $120 B or so attibutable to the portion used here, which backs out imports essentially barrel for barrel.

As for reducing the speed of oil trains, that is already happening, under the voluntary agreement with DOT, as mentioned in the post. You also seemed to suggest that shippers (“the industry”, presumably the oil industry) determine speeds and other operating procedures. That’s no more the case than you determing the speed of the trucks used by UPS or USPS when you mail a package. The railroads and their regulators make those decisions.

As for your comparision of the pre-2011 DOT-111 tank car situation to an automotive recall, that’s a matter of opinion, but I find the analogy weak. It’s clearly desirable that the cars provide more protection for highly flammable cargo, but at least as far as I’ve seen the older cars haven’t been found to be defective in the sense you suggest. Or did I miss that?

 

Rick Engebretson's picture
Rick Engebretson on Mar 25, 2014 8:21 am GMT

There is no excuse for such a production “band-aide.” A bunch of paper pushers in Brussels have just concluded there is an energy security problem in the de-industrializing nations, that it is Russia’s fault, and threats of reprisal are our best response.

If there was ever a recent instance of significant, constructive US government involvement in energy security, I’m not aware of it. Instead, it has been private developmenent that gives us the imperfect options we have. While scoffers on the government dole laugh from the sidelines making every effort harder. Shocking, unprecedented political leadership ineptitude. Conflict might be great for politicians, but the public has consistently voted to go to work.

Maybe the de-industrializing nations can’t any longer produce what we expect to consume. But we can at least try.

Geoffrey Styles's picture
Geoffrey Styles on Mar 25, 2014 1:44 pm GMT

Rick,

If you’re suggesting that crude by rail should be mainly a temporary measure to be replaced as soon as possible by pipelines, I agree, though I’m not sure the refiners on the east coast and west coast who are buying this oil would. Rail deliveries give them their best option versus imports, and the likelihood of laying pipe from North Dakoto to the Pacific, at least, seems low even if the government gave the idea an immediate green light, which is doubtful.

Rick Engebretson's picture
Rick Engebretson on Mar 25, 2014 4:11 pm GMT

Geoffrey, I don’t have a clue about the logistics and business of oil and gas. I read you for much of that. I’ve heard so many rumors I don’t know what to believe. But as an experienced businessman I’m sure you’ll agree that competent people are not is short supply. And fuels are a basic strategic commodity since the 1920s. For better or worse, we have resources in out backyard.

As you know, I’m not a “drill baby drill” type. But how does the other side reconcile hating the Koch Bros. and Russia and BP and Keystone all at the same time pushing conflict in every oil producing region on the planet? Maybe they simply hate oil and love war without any contradiction?

Conflict is failure. Cooperation is essential for our future. This administration has been endless crisis.

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