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Fiery Rail Spills Puts Safety Focus on Cutting Oil’s Volatility

(Bloomberg) — A series of rail accidents involving oil tank cars that exceed federal safety standards yet still burst into flames after derailing is shifting the focus from the container to the crude — and whether it’s too explosive to be carried by train. A wreck over the weekend in Canada brought the total to four in less than a month in the U.S. and Canada. All involved relatively modern tank cars known as the CPC-1232, which are designed to be sturdier than a model that regulators have said are prone to rupture. Safety advocates say the spills show that a proposed rule now under review at the White House to require even tougher tank cars is necessary, but that it may not go far enough. “The problem is in the product,” said Phil Steck, a New York state assemblyman whose district near Albany is bisected by oil trains. […]

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Canada under pressure after oil train derailment

The Canadian government faces similar pressure as its U.S. counterparts to do more to ensure oil is carried on railways safely, a lawmaker said. The Transportation Safety Board of Canada dispatched investigators to the site of a derailment of a train carrying crude oil through the village of Gogama in Ontario. The derailment is the second in the region in less than a month. The TSB’s last update was a Saturday announcement the derailment was from a train operated by Canadian National Railway Co. Glenn Thibeault, a member of the Canadian parliament and assistant to the Ontario environment minister, said more is expected from the federal government. The federal government, responsible for rail safety, must do more to protect our communities and the environment pic.twitter.com/XE2dgTn9go — Glenn Thibeault (@GlennThibeault) March 8, 2015 Canadian Transport Minister Lisa Raitt announced new regulations in April aimed at increasing safety on the Canadian […]

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Wrecks Hit Tougher Oil Railcars

ENLARGE Fire continued Friday after a train carrying 103 railcars loaded with crude oil from North Dakota’s Bakken Shale derailed south of Galena, Ill. Photo: Associated Press In a string of recent oil train derailments in the U.S. and Canada, new and sturdier railroad tanker cars being built to carry a rising tide of crude oil across the continent have failed to prevent ruptures. These tank cars, called CPC-1232s, are the new workhorses of the soaring crude-by-rail industry, carrying hundreds of thousands of barrels a day across the two countries. But the four recent accidents are a sign that the new tanker cars are still prone to rupture in a derailment. The ruptures could increase momentum for rules aimed at further reducing the risk of shipping crude by rail. In the last month, there have been significant derailments of crude-carrying trains in West Virginia and Illinois, plus two in […]

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CN Rail, BNSF Tackle Accidents as Group Seeks Ban on Oil Trains

Smoke and flames erupt from the scene of a train derailment near Galena, Illinois, on March 5, 2015. Photographer: Mike Burley/Telegraph Herald via AP Photo (Bloomberg) — Canadian National Railway Co. is building a 1,500-foot (457 meter) long track to bypass a burning train that derailed Saturday in northern Ontario, while BNSF Railway Co. crews are working to reopen track in rural Illinois after a train carrying oil derailed three days ago. CN crews teamed with outside specialists are fighting the blaze after an eastbound train carrying crude oil derailed and caught fire around 2:45 a.m. near Gogama, about 600 kilometers north of Toronto, cutting off rail traffic between Toronto and Winnipeg, Manitoba. The BNSF train jumped the tracks Thursday afternoon near Galena, Illinois, about 160 miles west of Chicago, according to the railroad, a unit of Warren Buffett’s Berkshire Hathaway Inc. The accidents bring to four the number […]

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Derailed Oil Train From Bakken Region Burns Day After Accident

(Bloomberg) — A BNSF Railway Co. train that carried 103 cars of crude oil from North Dakota’s Bakken region continued to burn a day after derailing just outside a rural Illinois town. Five of the cars caught fire and were still burning, BNSF said Friday in a statement. Fires and explosions related to Bakken crude spurred North Dakota regulators to require all operators to condition the crude to lower the vapor pressure beginning in April. “An initial pool fire occurred that we believe impacted five rail cars and that fire continues to burn,” BNSF, a unit of Warren Buffett’s Berkshire Hathaway Inc. said in the statement. “Local, state and BNSF Railway emergency personnel are on the scene working to contain the incident.” Of the 105-car train, including two sand cars as buffers, 21 jumped the tracks Thursday afternoon near Galena, Illinois, about 160 miles (260 kilometers) west of Chicago. […]

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Ill. oil-train derailment involved cars safer than federal standard

Derailed train continues to burn in Illinois GALENA , Ill., March 6 (UPI) — Two cars of an oil train carrying Bakken crude from North Dakota caught fire after a derailment in near Galena, Ill., Thursday, with an evacuation of homes within a one-mile radius. The train derailed near the confluence of the Galena and Mississippi Rivers, near Illinois’ border with Wisconsin and Iowa. There were no reported injuries. BNSF Railway in a statement said the tank cars involved were the "CPC-1232 model that were unjacketed with half-height head shields." The newer 1232 model was designed four years ago as part of voluntary safety upgrades adopted by the industry. Sixteen of the 105 cars of the train, all but two carrying crude oil, left the tracks, and two ignited, Galena City Administrator Mark Moran said. The derailment is the third in three weeks. In February, trains carrying crude oil […]

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Oil on Train in Illinois Derailment Shipped by Mercuria Energy

ENLARGE Railcars continued to burn at the scene of a freight train derailment south of Galena, Ill., on Friday. Photo: Associated Press The crude oil aboard the train involved in a fiery derailment Thursday in Illinois was shipped by a big energy-trading company based in Switzerland. The firm, Mercuria Energy Trading Inc., bought the oil in North Dakota and was delivering it to refineries in Philadelphia, according to people familiar with the matter. The train, operated by BNSF Railway Co., held about 70,000 barrels of oil from the Bakken Shale in 103 tanker cars. Federal officials said 21 of the cars derailed near Galena, Ill., about 160 miles west of Chicago. Seven of them were punctured or had holes in their steel skins. About 35 crude trains traveled through the area every week, according to state data. The oil caught fire, sending a thick plume of black smoke and […]

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BNSF Train Carrying Crude Oil Derails in Illinois

ENLARGE Flames and smoke can be seen at the site of an oil train’s derailment near Galena, Ill., on Thursday. Photo: Mike Burley/TH Media A BNSF Railway Co. train carrying crude oil derailed and began to burn Thursday afternoon near Galena, Ill., just over the state line from Wisconsin and 160 miles west of Chicago. The company said the train consisted of 103 modern railcars loaded with oil from North Dakota’s Bakken Shale, along with two cars carrying sand. Several cars derailed and two of the cars were on fire Thursday night, local officials said. The derailment took place in a rural area and there were no injuries reported, according to BNSF. The cause of the derailment wasn’t immediately known, and federal investigators were heading to the scene. Local officials called for a one-mile voluntary evacuation around the derailment. This is the third derailment of a train carrying crude […]

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Canadian Crude Exports by Rail Drop in Latest Quarter

CALGARY—Canada’s national energy regulator said Thursday exports of crude oil by rail dropped in the latest quarter, a sign that lower oil prices have made shipments by rail less attractive to some Canadian crude producers. Crude-by-rail exports declined 5% to 173,342 barrels a day in the fourth quarter, down from 182,396 barrels a day in the previous three month period but still above the 148,929 barrels a day exported in the last quarter of 2013, according to National Energy Board data. A slide in oil prices to six-year lows has crimped oil producers’ profit margins and made it uneconomical for some to ship by rail. Last month, Suncor Energy Inc. and Cenovus Energy Inc., two of Canada’s largest oil sands producers, both said they have stopped shipments of crude-by-rail to the U.S. Gulf Coast. The U.S. imports more oil from Canada than from any other country. Despite an overall […]

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The Best Way to Prevent Exploding Trains? Higher Oil Prices

Wreckage from the latest oil train explosion hadn’t yet been cleared from the crash site in West Virginia last week when President Obama vetoed legislation that would have  approved construction of the Keystone XL pipeline . The timing of the two events crystallizes one of the puzzles at the heart of the U.S. oil boom: How do we move all this new crude around the country? As production in the U.S. has soared to more than 9 million barrels a day—up from just 5 million back in 2008—the pipeline industry has scrambled to reorient itself around new oilfields in North Dakota and Texas. But railroads have proven more nimble and in many cases beat pipelines to the punch . The amount of crude being moved by trains jumped by almost 5,000 percent since 2009, even though trains are less efficient and typically more expensive than pipelines. Trains offer traders and energy companies something that pipelines don’t: flexibility.  With about 80 percent […]

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CP Rail CEO Says Biggest Crude-by-Rail Fear Is Terrorism

(Bloomberg) — Hunter Harrison, Canadian Pacific Railway Ltd.’s chief executive officer, said his greatest fear in moving crude by rail is the prospect of a terrorist attack on the company’s trains. “That’s what concerns me more because it can be planned to do the worst possible damage,” Harrison told reporters after a speech in Toronto. Canadian and U.S. transportation regulators are drafting tougher standards for oil tank cars as record volumes of the commodity are moving across the continent from oil fields in Western Canada and the U.S. New regulation was prompted by the explosion in Lac Megantic, Quebec, in 2013 that killed 47 people. There have been recent incidents too. Last month, a CSX Corp. train carrying crude derailed and exploded in West Virginia shortly after a derailed Canadian National Railway Co. train caught fire near Gogama, Ontario. CP has taken “quantum leaps” to reduce spills by improving […]

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Pennsylvania governor asks Obama for stronger crude-by-rail rules

WASHINGTON, DC, Mar. 2 03/02/2015 Noting that 60-70 trains/week carry Bakken crude oil across Pennsylvania to the Philadelphia area or other East Coast refineries, Gov. Tom Wolf (D) asked US President Barack Obama for stronger federal regulations to prevent derailments and improve safety. “I have already taken actions to address this issue including holding emergency trainings, participating in meetings with executives, and tasking my administration to put plans in place to both prevent accidents and mitigate impacts,” Wolf separately said on Feb. 27. “We also need expedited federal regulatory action in several areas along with a greater commitment to funding inspection and enforcement,” Wolf said. “We cannot afford to wait for a major incident before taking action.” In his Feb. 26 letter to Obama, Wolf called for consistent national standards to reduce Bakken crude’s volatility prior to transport, further reduction of trains’ speed limits through urban areas, more federal […]

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Crude on Derailed Train Contained High Level of Gas

The scene of a CSX crude-oil train burning after derailment in Mount Carbon, W. Va. ENLARGE Photo: Marcus Constantino/Reuters The crude oil aboard the train that derailed and exploded two weeks ago in West Virginia contained so much combustible gas that it would have been barred from rail transport under safety regulations set to go into effect next month. Tests performed on the oil before the train left North Dakota showed it contained a high level of volatile gases , according to a lab report reviewed by The Wall Street Journal. The oil’s vapor pressure, a measure of volatility, was 13.9 pounds per square inch, according to the Feb. 10 report by Intertek Group PLC. That exceeds the limit of 13.7 psi that North Dakota is set to impose in April on oil moving by truck or rail from the Bakken Shale. Oil producers that don’t treat their crude […]

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Who’s to Blame for the Exploding Oil Trains?

Railroads and oil companies bicker over the cost of new rules The Feb. 16 explosion near Mount Carbon, W.Va. A week after a CSX train hauling crude oil derailed and exploded 30 miles southeast of Charleston, W.Va., on Feb. 16, its mangled, charred tank cars were still being hauled from the crash site. Of the 27 cars that derailed, 19 had been engulfed in flames. The wreckage burned for almost three days. “It’s amazing no one was killed,” says John Whitt, whose home is one of a handful clustered near the crash site, along the banks of the Kanawha River. Some were within 30 yards of the site. One home was destroyed. Exploding oil trains—this was only the latest in a series—have emerged as a dangerous side effect of the U.S. energy boom. A lack of pipelines connecting new fields in North Dakota and Texas to refineries and shipping terminals has led to […]

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Oil-by-rail shipments are playing Russian roulette

LONDON (Reuters) – Train derailments involving crude oil and ethanol in the United States will cost more than $18 billion over the next 20 years, according to an assessment by the U.S. Department of Transportation. USDOT forecasts there will be just over 200 derailments involving trains carrying 20 or more tank cars of crude or ethanol between 2015 and 2034, an average of more than 10 per year, based on analysis of previous accidents and predicted growth in traffic volumes. Most will be "lower-consequence events" involving limited damage to property, environmental clean-up and only a few injuries or fatalities, with the bill totaling less than $5 billion. But up to 10 could have more serious consequences because they occur in more densely populated areas, with an estimated cost of $1.2 billion per incident. USDOT also considered a tail-risk event occurring in a densely populated urban center such as Chicago […]

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Derailed Oil Train in Ontario Was Within Speed Limit

A train that derailed in northern Ontario just over a week ago—igniting and spilling more than 6,000 barrels of oil—was traveling at a restricted speed and carrying oil in structurally enhanced tank cars, Canadian investigators said Monday. Initial findings on the accident from the Transportation Safety Board of Canada suggest it bore stark similarities to a fiery derailment that occurred days later in West Virginia . The findings are likely to add to concerns that recent regulatory steps to make the transport of oil by rail don’t go far enough. In the Ontario accident , 29 railcars derailed, with 21 sustaining fire damage, the TSB said. The train, operated by Canadian National Railway Co. , was traveling at 38 miles an hour at the time of the derailment, under a 40-mile-per-hour speed restriction, the agency said. The train was made up of tank cars built to the new CPC-1232 […]

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Canada Unveils an Oil-Train Safety Tax

A Canadian National Railway train carrying crude oil derailed near Timmins, Ontario last weekend. ENLARGE Photo: Transportation Safety Board of Canada/Reuters OTTAWA—Canada said it would create a compensation fund to cover the potential costs of oil-train derailments and finance the move with a new levy on crude shippers. The planned fund—first reported by The Wall Street Journal earlier Friday—was one of several new measures Canada unveiled to bolster the safety of a rail system carrying growing volumes of crude. Canada had pledged to hold railways and shippers more accountable after the derailment of a crude-carrying train in Quebec in July 2013 killed 47 people and wiped out the town’s core. The Lac-Mégantic accident spurred regulatory changes in the U.S. and Canada—from beefed up emergency-preparedness requirements to new rules governing railcars—while raising concerns about the risks the oil-by-rail boom poses to communities across North America. Those risks were highlighted again […]

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Residents return home after W. Va. derailment

http://launch.newsinc.com/share.html?trackingGroup=91585&siteSection=unitedpress&videoId=28581637 Oil tanker train. Photo by Steven Frame/Shutterstock MOUNT CARBON, W.Va., Feb. 20 (UPI) — Some of the residents in and around communities evacuated in response to a West Virginia oil-train derailment can return home, a unified command said. Federal regulators said about 28 cars from a CSX line derailed Monday afternoon near Mt. Carbon, W. Va. State officials said about half of the derailed cars were transporting crude oil from North Dakota, which would equate to approximately 8,000 barrels. At least one home was destroyed in the massive fireball that followed the derailment. A unified command established to respond to the incident said some evacuated residents can go home, though others were still under restrictions because of safety concerns. Six of the derailed cars were put back on their tracks by recovery crews. Some of the oil still left in the derailed cars was transferred elsewhere for later […]

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Amid controversy, oil trains quietly rerouted through Virginia towns

(Reuters) – Hundreds of communities across the United States have become accustomed to the sight of mile-long oil trains rumbling by in recent years. Pembroke, Virginia, was not one of them, until now. CSX Corp is temporarily rerouting up to five oil trains through this small riverside town to bypass the site of an explosive oil train derailment that occurred 90 miles north in Mount Carbon, West Virginia, on Monday. The trains will likely travel instead on a track that hugs the New River and at one point sweeps into the Pembroke town limits. In line with a federal protocol established last year following a string of fiery derailments across North America, the Virginia Department of Emergency Management on Tuesday informed 16 counties and cities that oil trains could be coming through their towns, local officials and fire departments said, one day after the Mount Carbon derailment. Those counties […]

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Environmental team surveying W. Va. oil-train disaster

Crews are on the ground in and around the site of Monday’s oil-train derailment in West Virginia deploying containment boom, the response team said. The National Transportation Safety Board estimated 28 tank cars of the 109 from a CSX line slipped the rails early Monday afternoon near Mt. Carbon, W. Va. State authorities estimated about a dozen of those cars were transporting crude oil from North Dakota, which would equate to approximately 8,000 barrels. A unified command set up by CSX, local, state and federal authorities said crews are on the ground surveying land and water contamination . No cars fell into the nearby Kanawha River. "The response crews were able to deploy about 500 feet of containment boom as a precautionary measure to limit potential impact on the environment," the command center said in its latest update Wednesday. "The use of additional boom material is being evaluated." West […]

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West Virginia Oil Train That Derailed Was Traveling Under Speed Limit

ENLARGE The CSX train that derailed near Mount Carbon, W.Va., was going 33 miles an hour in a 50 mph zone, said Sarah Feinberg, acting head of the Federal Railroad Administration. Photo: Office of the Governor of West Virginia/Associated Press The crude-oil train that derailed and exploded in West Virginia on Monday was traveling well below the track’s speed limit, according to an onboard recording system, a federal official said Thursday. Sarah Feinberg, acting head of the Federal Railroad Administration, said the CSX Corp. train that derailed near Mount Carbon, W.Va., was going 33 miles an hour in a 50 mph zone. The cause of the derailment remains under investigation, and Ms. Feinberg said investigators would look at the condition of the rails, tanker car wheels and other factors that could have contributed to the accident. Investigators have so far examined outward-facing video footage from the train, as well […]

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NTSB: Oil by rail needs scrutiny after W. Va. incident

The National Transportation Safety Board estimated 28 tank cars of the 109 from a CSX line slipped the rails early Monday afternoon near Mt. Carbon, W. Va. The state Department of Military Affairs & Public Safety estimated that about a dozen of the cars were carrying crude oil, which would equate to approximately 8,000 barrels. The NTSB said an undetermined amount of crude oil spilled into an area river. U.S. crude oil production levels are more than the existing pipeline infrastructure can handle, forcing energy companies to use rail as an alternative transit method. The increase in crude oil transport by rail has raised safety concerns, most notably in the wake of a deadly 2013 accident in Lac-Megantic, Quebec. Most rail incidents involving crude oil spills were tied to cars labeled DOT-111. The incident in West Virginia involved newer model cars designated CPC 1232. "This accident is another reminder […]

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CSX train hauling North Dakota oil derails, cars ablaze in West Virginia

BECKLEY, W.Va. (Reuters) – A CSX Corp train hauling North Dakota crude derailed in West Virginia on Monday, setting a number of cars ablaze, destroying a house and forcing the evacuation of two towns in the second significant oil-train incident in three days. One or two of the cars plunged into the Kanawha River, and “a couple are burning," said Robert Jelacic, night shift manager of the West Virginia Department of Homeland Security and Emergency Management. There were no injuries or deaths, he said. CSX said the train was hauling 109 cars from North Dakota to the coastal town of Yorktown, Virginia, where midstream firm Plains All American Pipelines runs an oil depot. It said one person was being treated for potential fume inhalation. West Virginia State Police First Sergeant Greg Duckworth, who was at the crash site, told Reuters that nine or 10 of the cars had exploded […]

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Oil-Train Fireball Seen Adding Pressure for U.S. Safety Decision

Derailed oil tanker train cars burn near Mount Carbon, West Virginia, on Feb. 16, 2015. Photographer: Marcus Constantino/The Daily Mail via AP Photo (Bloomberg) — Video images of a fireball boiling from the wreckage of a derailed train hauling Bakken crude are adding to pressure on federal regulators to act on new safety standards for oil shipments. While there were no fatalities in the CSX Corp. accident in rural West Virginia on Monday, the footage of flames and smoke rekindles public alarm over the prospect of tank cars rumbling through urban areas, according to a former U.S. Transportation Department official and a railroad consultant. “It weakens the railroad’s and the industry’s ability to argue on the merits” to shape the government’s decision, Brigham McCown, a former chief of the Pipeline and Hazardous Materials Safety Administration, said by phone Tuesday. “In Washington, D.C., perception is reality. Railroads have to get […]

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Oil Train Derails and Ignites Forcing West Virginia Evacuations

A fire burns after a train derailment near Charleston, West Virginia on Feb. 16, 2015. (Bloomberg) — A CSX Corp. train carrying Bakken oil from North Dakota derailed and ignited in West Virginia, forcing some residents to flee their homes in frigid weather while cutting power and threatening drinking water. Governor Earl Ray Tomblin declared a state of emergency for Kanawha and Fayette counties as the train’s operator worked with emergency responders at the scene. One person was treated for possible smoke inhalation and fire broke out on up to 15 of an estimated 27 derailed cars, said Lawrence Messina, a spokesman for the West Virginia Department of Military Affairs and Public Safety. There are about 85 people in local shelters and more may be in hotels following the derailment that occurred early Monday afternoon, according to Messina. Fire damaged power lines while the town of Montgomery shut an […]

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Canada railway strike ends after government threatens bill

OTTAWA, Canada (AP) — Canada’s labor minister said Monday the Canadian Pacific Railway strike had ended, with both sides agreeing to resume discussions. News of the deal came after Canada’s Conservative government threatened to introduce legislation to force an end to the strike by more than 3,000 Teamsters members, saying the strike posed a threat to the economy. In a surprise news conference, Labor Minister Kellie Leitch welcomed the willingness by both sides to resume talks, a development that had seemed impossible just hours earlier. The strike by 3,300 locomotive engineers and other train workers began just after midnight Sunday after contract talks failed. Leitch had said the strike could cost the economy more than $200 million in lost GDP every week. Teamsters union president Douglas Finnson called the government’s intervention in the strike disappointing and premature. CP Rail supported the move. Leitch had said the strike would affect […]

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Canadian National’s Main Line Shuts After Crude Cars Derail

(Bloomberg) — Canadian National Railway Co. shut its main line linking western and eastern Canada after an eastbound train carrying crude oil derailed in Ontario. The train of 100 cars, all carrying crude from Canada’s oil-producing region of Alberta to eastern Canada, derailed just before midnight Saturday in a remote and wooded area about 30 miles (48 kilometers) north of Gogama, Ontario, spokesman Patrick Waldron said in an e-mail. About 18 freight trains a day use the line, he said. A total of 29 cars were involved in the incident and seven caught fire. The remaining 71 cars were moved from the site, Waldron said. Some oil was spilled. Shipments scheduled along the affected corridor will be delayed by at least 24 hours, the company said. Canadian oil producers have grown dependent on shipping crude by rail as pipeline capacity has become constrained. The shutdown happened as locomotive engineers […]

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Train Carrying Crude Oil Derails in Ontario

A train carrying crude oil and operated by Canadian National Railway Co. derailed near the town of Timmins in northern Ontario just before midnight on Saturday, causing a fire but no reported injuries. The train derailed in a remote wooded area, according to a spokesman for Montreal-based CN, Canada’s largest railroad company. He said the railway company had deployed firefighting and environmental crews to the scene. The cause of the incident wasn’t yet known, he said. “Our emergency crews continue to conduct a full site assessment to determine the number of rail cars derailed and involved in the fire, and if any product has been spilled,” said CN spokesman Patrick Waldron in an emailed statement on Sunday afternoon. “Seventy-one cars of the 100-car train have been safely moved away from the derailment site. Early site assessments indicate that at total of 29 cars are involved in the incident. That […]

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Threatened Canadian Rail Strike Seen Weakening Heavy Oil Prices

(Bloomberg) — Canadian crude prices near a six-year low may weaken further should workers at Canadian Pacific Railway Ltd carry through with threats to strike this weekend. The company faces a work stoppage as soon as Feb. 15 by Teamsters Canada Rail Conference and Unifor Local 101R, which represent a combined 5,000 workers. Canadian Pacific will deploy managers “to maintain a reduced freight service” on its Canadian lines. Canadian oil companies have increasingly relied on rail cars to deliver crude produced in Alberta to refineries as far away as the U.S. Gulf Coast. Canadian Pacific delivered 110,000 carloads of crude last year, 22 percent more than in 2013, according to company data. Without “enough trains operating, I could see how it will delay the deliveries of crude shipments,” Dinara Millington, a vice president at the Canadian Energy Research Institute, said by phone Friday. “The prices of WCS could decline […]

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Revised Oil-Train Safety Rule Said to Push Back Upgrade Deadline

(Bloomberg) — The Obama administration revised its proposal to prevent oil trains from catching fire in derailments, giving companies more time to upgrade their fleets but sticking with a requirement that new tank cars have thicker walls and better brakes. The changes, described by three people familiar with the proposal who asked not to be identified because the plan has not been made public, are in proposed regulations the U.S. Transportation Department sent to the White House last week for review prior to being released. The administration is revising safety standards after a series of oil-train accidents, including a 2013 disaster in Canada that killed 47 people when a runaway train derailed and blew up. Earlier this month a train carrying ethanol derailed and caught fire outside of Dubuque, Iowa. No one was hurt. Companies that own tank cars opposed the aggressive schedule for modifying cars in the DOT’s […]

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BNSF makes capital commitments to North Dakota

BNSF makes $325 million commitment to improve rail network in oil-rich North Dakota. Photo: Daniel J. Graeber/UPI BISMARCK, N.D., Feb. 12 (UPI) — A $325 million commitment from BNSF Railway Co. will help meet the growing needs in the oil-rich state of North Dakota, one of the state’s senators said. BNSF early this week said it was investing in continued construction and upgrades to its rail network in North Dakota, including a centralized traffic control center meant to improve traffic efficiency through the state. "We have been working to maintain and improve our infrastructure, especially our railways, to meet the needs of our growing state," Sen. John Hoeven, R-N.D., said in a Wednesday statement . "BNSF’s $326 million investment will help to relieve backlogs now, but also plan for the continued growth of our economy." North Dakota’s economy is growing at a faster rate than any state in the […]

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US DOT missed self-imposed deadline to submit crude-by-rail regs for review

Washington (Platts)–3Feb2015/352 pm EST/2052 GMT Representatives of the rail industry Tuesday complained to the US Congress about the Obama administration’s slow pace in issuing its comprehensive crude-by-rail safety rule, as the Department of Transportation missed a self-imposed January 30 target to submit the regulation to the White House for final review. Joe Delcambre, a spokesman with DOT’s Pipelines and Hazardous Materials Safety Administration, told Platts the agency hopes to send the rule, including an overhaul of tank car safety standards, "very soon" to the White House Office of Management and Budget, which vets all regulations before they go into effect. The DOT in January had said in a rulemaking schedule update that it planned to submit the rule to OMB by January 30, and for the rule to be finalized by May 12. "The rulemaking is very comprehensive and involves interrelated issues that must be carefully assessed to ensure […]

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‘Bomb Train’ Terminal Lawsuits Sidetrack Crude-Oil Rail Plans

(Bloomberg) — Rail yard projects vital to the flow of crude from the shale oil boom are being waylaid in court by legal challenges that may slow the march to U.S. energy independence. Crude-oil handling facilities along rail lines in cities from Albany, New York, to Richmond, California, are mired in lawsuits by community and environmental groups claiming they were kept in the dark about the projects. They accuse local regulators of giving cursory review and rubber-stamping operating permits for proposals that pose threats to their safety and the environment. In Albany, pollution regulators who examine such projects for dirty-air potential are grappling with 19,000 comments from residents more worried about exploding trains. Citizen complaints about the move to rail as a new means of transporting oil initially focused on safety conditions of tanker cars en route from shipping point to destination as pipeline capacity failed to keep pace […]

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California breaks ground on first US bullet train project

California’s high-speed rail project reached a milestone Tuesday as officials marked the start of work on the nation’s first bullet train, which will whisk travelers at 200 mph between Los Angeles and San Francisco in less than three hours. The ceremony in Fresno comes amid challenges. Central Valley farmers in the train’s path had sued to block it and are now contesting that those behind the project have fallen short of responsibilities under a 2013 legal settlement, according to The Fresno Bee . Meanwhile Republican members of U.S. Congress have vowed to cut funding for the $68 billion projecton the grounds of its perceived expense. Opponents also say the state can’t deliver the sleek project as it was first promised. Dan Richard, chairman of the California High-Speed Rail Authority, acknowledges the authority has been slow to buy up most of the land needed for laying track. But he is […]

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Railroad Operators’ Fixes To Be Tested Again — Corporate Outlook

By Laura Stevens and Jesse Newman Rail congestion that caused headaches for shippers of everything from corn to coal may start to ease in 2015 as operators spend more to increase capacity. The entire transportation industry experienced capacity strains in 2014 as the U.S. economy continued to recover. Rail was one of the hardest hit areas, with unexpectedly strong demand and bad weather taking their toll on service. Severe delays for shipments of corn, soybeans and other crops in the upper Midwest began in early 2014, with bitterly cold temperatures forcing operators to run shorter, slower trains even as a record harvests produced more grain needing transport. The snarls returned after another bumper harvest in the autumn. The coal industry also has complained of significant delays, particularly in the western U.S. To fix this, railroads including BNSF Railway Co., owned by Warren Buffett’s Berkshire Hathaway Inc., are collectively spending […]

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Even oil could face rail shortages soon

Brett Gundlock | Bloomberg Tougher rules on shipping crude by rail mean oil producers in North Dakota’s Bakken region could soon face the unwelcome choice of spending more to ship by truck or cutting back on production altogether. That’s the takeaway from a Wall Street Journal report that says that the Railway Supply Institute is warning that tens of thousands of rail cars will be sidelined because they no longer meet code in the wake of new safety regulations on shipping crude oil by train. The U.S. Department of Transportation has mandated that rail cars carrying flammable liquids meet higher safety standards. North Dakota regulators also toughened its own rules on shipping , saying that volatile gases had to be removed from crude oil before shipping. There’s a potential upside for any business not involved in oil: Farmers, manufacturers and utilities have complained for the past year that oil […]

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Cheap Oil Jamming Rails Means Higher U.S. Power Bills

U.S. electricity costs are poised to reach the highest level since 1999 because railroads are too clogged to deliver enough coal to power plants. While the U.S. has the world’s biggest coal reserves, utilities are forecast by the government to end the year with the lowest stockpiles since 2005. With carriers including BNSF Railway jammed with record shipments of oil and grains, Xcel Energy Inc. (XEL) and other power producers say they can’t get the coal they need. The rail delays mean utilities haven’t rebuilt inventories that fell to a seven-year low last winter. Power producers filed 10 notices this year warning regulators that stocks were low enough to threaten generation, compared with two filings in 2013. Utilities have been obliged to rely more on natural gas, increasing costs for consumers. “There’s plenty of coal,”Jim Thompson, a director of coal for IHS, an Englewood, Colorado-based energy and industrial analytics […]

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Bakken Oil Transport Still Not Safe

New Regulations Don’t Go Far Enough to Protect the Public Helicopter view of the Lac-Mégantic rail disaster | Image courtesy of Sûreté du Québec: CC BY-SA 1.0 When the North Dakota Industrial Commission issued its landmark ruling last week concerning the conditioning of oil, it appeared that they were making a serious move towards improving the safety of transporting crude out of the Bakken. But according to an article in the StarTribune, the new regulations, which go into effect April 2, 2015, won’t bring the industry any closer to a solution for a serious problem that is drawing fire from legislators, concerned citizens and environmental groups. Alan Stankevitz, an expert on the DOT 111 tanker car, explains in the StarTribune that the standards set by the commission, which includes Gov. Jack Dalrymple, are not enough to adequately address the problem. The order establishes new regulations that demand facilities to […]

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Cheap Oil Jamming Rails Means Higher U.S. Power Bills

U.S. electricity costs are poised to reach the highest level since 1999 because railroads are too clogged to deliver enough coal to power plants. While the U.S. has the world’s biggest coal reserves, utilities are forecast by the government to end the year with the lowest stockpiles since 2005. With carriers including BNSF Railway jammed with record shipments of oil and grains, Xcel Energy Inc. (XEL) and other power producers say they can’t get the coal they need. The rail delays mean utilities haven’t rebuilt inventories that fell to a seven-year low last winter. Power producers filed 10 notices this year warning regulators that stocks were low enough to threaten generation, compared with two filings in 2013. Utilities have been obliged to rely more on natural gas, increasing costs for consumers. “There’s plenty of coal,”Jim Thompson, a director of coal for IHS, an Englewood, Colorado-based energy and industrial analytics […]

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New Regulations for Oil Transportation in the Bakken

Will tougher regulations for oil transport create a safer environment? Commission Adds New Restrictions for Oil Transports In an effort to improve the safety of crude production in the Bakken region, the North Dakota Industrial Commission issued an order on December 9th that will impose new regulations on oil producers. The order (no. 25417) is the result of an investigation that began at an emotionally charged hearing in September. Over the past two months, commission members Gov. Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring considered oral and written comments from technical witnesses, manufacturers, land/royalty owners and the general public. The new regulations will go into effect on April 1, 2015 and require that all new wells in the Bakken Petroleum System utilize equipment that controls vapor pressure in order to lessen the likelihood of explosions during transportation. This order comes as a series of troublesome […]

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Rail shipments of oil here to stay, IHS finds

IHS Energy finds rail an "enabler" of growth in North American crude oil production.. (Photo: Daniel J. Graeber) More than 10 percent of the oil transported in North American will be carried on the region’s rail system at its peak, analysis from IHS Energy finds. The Organization of Petroleum Exporting Countries finds the world needing less of its crude oil in part because of the glut in the North American market brought on by shale. The United States alone is producing around 9 million barrels of oil per day and, with the existing pipeline network lacking the capacity to handle the load, those in the industry are turning to rail as an alternate transit method. "Rail transport of crude oil has become an enabler of growth in North America, playing a crucial role as pipeline capacity has struggled to keep pace with the rapid rise of North American oil […]

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US spending bill would speed up crude-by-rail rule, stem more product reserves

Washington (Platts)–10Dec2014/455 pm EST/2155 GMT The US Department of Transportation would face a January 15 deadline to issue its long-awaited crude-by-rail safety regulations, under a must-pass spending bill crafted by Republican and Democratic lawmakers from both chambers of Congress. The $1.1 trillion bill also would restrict the US Department of Energy from creating any crude product reserves without the consent of the congressional appropriations committees. In addition, it would block the US Fish and Wildlife Service from listing the greater sage grouse and three other grouse species as a threatened or endangered species for a year, opening up significant acreage in the Western US to oil and gas development. Those three measures are among several riders attached to the bill, which must pass to keep the federal government open past Thursday. The House of Representatives is scheduled to vote on the bill Thursday, while the Senate is scheduled to […]

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North Dakota commission approves crude conditioning order

Washington (Platts)–9Dec2014/524 pm EST/2224 GMT North Dakota’s Industrial Commission on Tuesday approved an order requiring Bakken crude oil to be conditioned before it is shipped by rail. The order, which had been delayed for a month, was approved unanimously by the commission, which includes Governor Jack Dalrymple, Attorney General Wayne Stenehjem and Agriculture Commissioner Doug Goehring. Under the order, crude oil cannot have a vapor pressure that exceeds 13.7 psi, 1 psi below the national standard of 14.7. The order, which was delayed for a month as the commission collected additional public comment and made technical corrections, faced opposition from the state’s oil and gas operators, including Hess, Marathon Oil and Continental Resources. These companies claimed the order could cost them millions of dollars, impact infrastructure projects and set up jurisdictional clashes with federal officials. Corrections to the previous order included lowering temperature requirements when companies claimed earlier temperature […]

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Oil Trains Hide in Plain Sight

A Norfolk Southern Corp. train in a refinery in Delaware, waiting to unload its cargo… ENLARGE A Norfolk Southern Corp. train in a refinery in Delaware, waiting to unload its cargo of crude oil from North Dakota. Russell Gold/The Wall Street Journal NEWARK, Del.—Early last year, a new kind of pipeline full of volatile oil appeared in this college town, halfway between Philadelphia and Baltimore. If it had been a traditional pipeline, there would have been government hearings and environmental reviews. There would be markers or signs along the line’s route and instructions for nearby residents on how to react in an emergency. A detailed plan for responding to a spill would be on file with the federal government. None of that happened here in Newark. In fact, nobody initially notified the city’s fire chief about the new line, which can carry more than a hundred thousand barrels of […]

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Nearly 3,000 Canadian Railroad Cars No Longer Transport Oil, Chemicals

A firefighter stands close to the remains of a train wreckage in Lac-Mégantic, Quebec, on… ENLARGE A firefighter stands close to the remains of a train wreckage in Lac-Mégantic, Quebec, on July 8, 2013. Reuters Nearly 3,000 Canadian railroad tank cars are no longer carrying dangerous goods after falling foul of the beefed-up safety regulations that followed last year’s fatal derailment in Quebec. Canada’s Transport Department said 2,879 tank cars were deemed too risky to carry goods such as oil and chemicals in the country, according to documents presented in Parliament last week. In late April , Canada gave rail operators 30 days to stop using the least crash resistant types of DOT-111 tanks cars to transport such goods. Those DOT-111s still transporting dangerous goods have to be refitted with thicker steel and stronger reinforcements within a three-year period, or else be pulled off the rails. The DOT-111 was […]

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Why a small North Dakota town is taking on Big Rail

ENDERLIN, N.D. (Reuters) – After her shift at the TraXside Cafe in the southeast North Dakota hamlet of Enderlin, all Karla Souer wants to do is go home. Unfortunately for the 38-year-old waitress the commute, which should only last a minute or two, can take a half-an-hour. That’s because, chances are, there’s a Canadian Pacific Railway Ltd train blocking the tracks somewhere on her route. She has a lot of company. Partly thanks to North Dakota’s energy boom, twenty-eight of the railroad’s trains now traverse the city every day. Each carry hundreds of tank cars filled with oil or grain. Some idle as long as four hours, inconveniencing motorists, stranding pedestrians and posing logistical challenges for ambulances and firefighters. Desperate for a solution, Enderlin’s city councilors last month banned train breaks longer than 10 minutes. The railroad has, in turn, sued the city of nearly 900 in federal court. […]

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North Dakota reviews oil train safety measures

North Dakota officials review rail safety after second derailment in less than a year. (Photo: Daniel J. Graeber) Rail operators in North Dakota have taken a good step forward on safety, though they’re likely to face further scrutiny, Gov. Jack Dalrymple said. Dalrymple met with officials from BNSF Railway to discuss rail safety in the state. The rail company, the government said, is facing pressure after two derailments near the town of Casselton in the same calendar year. Around 1 dozen empty crude oil tankers derailed Nov. 13 in Casselton from a BNSF-operated train. About 950 barrels of oil spilled when two trains operated by BNSF collided and derailed near Casselton in late December. The governor said the rail company outlined a series of ways it would ensure safety in and around Casselton following the latest derailment. "These actions are a good step forward to preventing further incidents and […]

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