Transportation Department floats rules to keep trains carrying crude oil from exploding

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The Transportation Department floated new rules Wednesday designed to prevent trains carrying crude oil from exploding.

The effort is a response to a number of recent derailments and explosions that have increased partly because of booming oil production in the Bakken shale formation in North Dakota and Montana. The DOT's Pipeline and Hazardous Materials Safety Administration is investigating whether crude from that region is more flammable than other varieties.

“Safety is our top priority, which is why I've worked aggressively to improve the safe transport of crude oil and other hazardous materials since my first week in office,” Transportation Secretary Anthony Foxx said. “While we have made unprecedented progress through voluntary agreements and emergency orders, today's proposal represents our most significant progress yet in developing and enforcing new rules to ensure that all flammable liquids, including Bakken crude and ethanol, are transported safely.”

The multi-pronged proposal affects trains carrying 20 or more carloads of flammable liquids such as crude oil and ethanol. It calls for phasing out legacy tankers, thicker walls for new ones, reduced speed limits and a testing program to properly classify types of crude. The proposed rule will be open for public comment for the next 60 days.

The proposed rule is more comprehensive than what DOT had been working on, which had originally focused primarily on tanker car regulations and the Bakken region. The DOT offered a mix of proposals for comment, with the price tag in 2034 ranging from a low of $1.7 billion of benefits at a $2.6 billion cost to $4.75 billion of benefits and $6 billion in costs.

The DOT noted in the proposed rule that carloads of the class of crude originating from the Bakken, which now produces 1 million barrels of oil per day, have jumped from 10,800 per day in 2009 to more than 400,000 last year. Accidents involving trains carrying crude oil have increased as well, going from zero in 2010 to five in last year and this year. DOT predicted derailments would rise to 15 next year without new safeguards, settling at five annually by 2034.

"The projected continued growth of domestic crude oil production, and the growing number of train accidents involving crude oil, PHMSA concludes that the potential for future severe train accidents involving crude oil in [high-hazard flammable trains] has increased substantially. Such an increase raises the likelihood of higher-consequence train accidents," the proposed rule said.

The American Petroleum Institute said it was willing to work with federal regulators and other industries, such as railroad companies, on the rules, but pushed back against claims that Bakken crude was more flammable compared with other types.

“The best science and data do not support recent speculation that crude oil from the Bakken presents greater than normal transportation risks,” API CEO Jack Gerard said. “Multiple studies have shown that Bakken crude is similar to other crudes."

The proposal calls for retiring the older tankers, known as DOT-111, carrying Bakken crude within two years and all that carry flammable liquid within five years unless they're retrofitted to comply with the new standards such as thicker walls and enhanced braking systems. Carriers also would need to select the safest routes for transport based on a series of security conditions and would need to notify state emergency responder commissions when trains carrying more than 1 million gallons of Bakken crude enter the state.

All trains that meet the new standards and carry at least 20 carloads of flammable liquids would be subject to a 50 miles per hour speed limit. PHMSA suggested a 30-mph limit for those without advanced braking mechanisms.

Commenters will have an option to weigh in on three proposed speed limits for tank cars that don't meet enhanced safety standards, all of which register at 40 mph. One would make train speeds 40 mph across the board, another would institute the limit in high-threat urban areas and the last would do so in population centers of at least 100,000 people.

An accompanying notice for an anticipated proposed rule also suggested lowering the threshold that triggers the development of a comprehensive oil spill plan by shippers. That level is current level, set in 1996, is 42,000 gallons per tank car, but most crude oil tankers now carry 30,000 gallons.

Sen. Chuck Schumer, D-N.Y., urged swift approval of the rules.

"Safety is job number one, and the DOT should be commended for heeding our call and including a package of commonsense safety measures – like speed limits, new braking controls, and standards for a safer tank car – that will further safeguard communities along freight lines. These safety rules should be finalized, implemented, and enforced as soon as possible,” he said.

Sen. John Hoeven, R-N.D., who has pushed DOT to quickly finish the rulemaking, took a more cautious approach.

“We appreciate that DOT has issued its proposal for rail tank cars today that appears to be comprehensive and deals with prevention, mitigation and response. We will continue to review these proposed standards to ensure they are workable and will keep our communities safe,” he said.

But environmental groups said the proposed rules didn't go far enough.

"The rules proposed today by the Department of Transportation acknowledge the dangerous risks inherent to transporting oil by rail but do far too little, too late, and the process takes far too long. These dangers exist today, so they need to be addressed right now," Sierra Club Executive Director Michael Brune said.

This story was first published at 11:30 a.m. and has been updated.

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