Following a 9-percent increase in crude-by-rail deliveries during the first seven months of 2014 compared to the same period in 2013, the U.S. DOT published proposed rules to improve the safety of tank cars in August.
The Association of American Railroads (AAR) estimates the majority of the nearly 460,000 carloads tracked in its petroleum and petroleum products category during the first seven months of this year were made up of crude oil. Considering the average tank car holds about 700 barrels of crude, the first seven months of 2014 saw approximately 759,000 barrels of crude moved by rail per day, which is the equivalent of 8 percent of U.S. oil production.
The DOT’s proposed rules would require oil tank cars constructed after October 2015 to have thicker steel and require retrofitting of existing tank cars. AFPM, which represents the majority of refiners that transport crude by rail, believes the proposed rule does not address lack of track integrity and rail inspections, which the organization points to as the causes behind recent derailments.
“While DOT’s rule places appropriate attention on tank car standards, it fails to give adequate consideration to the root causes of recent derailments,” said David Friedman, AFPM vice president of regulatory affairs. “DOT needs to prioritize a rulemaking that addresses the primary causes of these derailments, which include track integrity, rail inspections and personnel training. Investment in derailment prevention would result in the greatest reduction in risk of transporting all hazardous materials.”
Friedman explained shippers of crude oil have demonstrated a commitment to a safer rail car standard in advance of the proposed rule, as they have spent more than $3 billion since 2011 to purchase new upgraded tank cars that meet AAR’s Casualty Prevention Circular-1232 standard and go far beyond existing regulatory requirements.
AFPM believes the DOT should also consider recommendations made by the National Transportation Safety Board to improve track safety standards and reduce human error.
As part of the proposed regulations, the DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) is proposing older DOT-111 tank cars, the industry’s current workhorse, be phased out of use for the shipment of packing group I flammable liquids within two years. API President Jack Gerard said PHMSA’s timeline is not feasible and could harm consumers by disrupting production and transportation of goods, a view shared by AAR.
“It is no exaggeration to say, given the shop capacity limitations that exist, PHMSA’s current proposals could stifle North America’s energy renaissance and curtail substantial volumes of U.S. and Canadian oil production,” Gerard said. “We have instead proposed an aggressive yet achievable program for retrofitting the crude oil fleet to get stronger cars onto the tracks as fast as possible while limiting the most adverse economic consequences for consumers. Under our proposal for the crude oil fleet, manufacturing facilities would have six to 12 months to ramp up capacity for handling retrofits.
“The legacy DOT-111 fleet moving in unit trains of crude oil would then be retrofitted or replaced within three years. Retrofits of the stronger, nonjacketed cars constructed since 2011 would be completed after an additional three years, allowing these cars to continue delivering energy to consumers during the retrofit period for the legacy fleet.”
The Federal Railroad Administration recently funded two grants totaling $350,000 to support development of a Short Line Safety Institute. The new institute is designed to help alleviate risk associated with shipping hazardous materials by rail. The institute will work to improve the culture of safety within the short line and regional rail industry while improving its overall safety record.
“Nearly half of all short line and regional railroads handle some type of hazardous materials, and these grants will play an important role in ensuring those materials and all shipments reach their destinations safely,” said U.S. Transportation Secretary Anthony Foxx.
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Photo: Harvey Henkelmann
