North Dakota's new oil train safety checks seen missing risks (updated)

Continental Energy

31/03/2015 21:14

(Adds background on an Energy Department study of crude oil in 
paragraphs 18, 19) 
    By Patrick Rucker 
    WASHINGTON, March 31 (Reuters) - New regulations to cap 
vapor pressure of North Dakota crude fail to account for how it 
behaves in transit, according to industry experts, raising 
doubts about whether the state's much-anticipated rules will 
make oil train shipments safer. 
    High vapor pressure has been identified as a possible factor 
in the fireball explosions witnessed after oil train derailments 
in Illinois and West Virginia in recent weeks. 
    For over a year, federal officials have warned that crude 
from North Dakota's Bakken shale oilfields contains a cocktail 
of explosive gas - known in the industry as 'light ends.'  
    The new rules, which take effect on April 1, aim to contain 
dangers by spot-checking the vapor pressure of crude before 
loading and capping it at 13.7 pounds per square inch (psi) - 
about normal atmospheric conditions. 
    The plan relies on a widely-used test for measuring pressure 
at the wellhead, but safety experts say gas levels can climb 
inside the nearly-full tankers, so the checks are a poor 
indicator of explosion risks for rail shipments. 
    It is "well-understood, basic physics" that crude oil will 
exert more pressure in a full container than in the test 
conditions North Dakota will use, said Dennis Sutton, executive 
director of the Crude Oil Quality Association, which studies how 
to safely handle fossil fuels. 
    Ametek Inc  AME.N , a leading manufacturer of testing 
equipment, has detected vapor pressure climbing from about 9 psi 
to over 30 psi - more than twice the new limit - while an oil 
tank is filled to near-capacity. (Graphic: http://reut.rs/1EHChG4) 
    About 70 percent of the roughly 1.2 million barrels of oil 
produced in North Dakota every day moves by rail to distant 
refineries and passes through hundreds of cities and towns along 
the way.  
    The state controls matter to those communities because there 
is no federal standard to curb explosive gases in oil trains. 
    North Dakota officials point out that the pressure limit is 
more stringent than the industry-accepted definition of "stable" 
crude oil. They also say that they lack jurisdiction over tank 
cars leaving the state and that the pressure tests are just one 
of the measures to make oil trains safer. 
    "We're trying to achieve a set of operating practices that 
generates a safe, reliable crude oil," Lynn Helms, director of 
the North Dakota Department of Mineral Resources, has said. 
Helms has also said that test readings for near-full containers 
were less reliable. 
    However, given different testing and transport conditions, 
industry officials say the pressure threshold may need to be 
lowered to reduce the risks. 
    Limiting vapor pressure to 13.7 psi in transit would require 
an operator to bring it to "something well below that" at the 
loading point, Sutton said. 
    The uncertainty about regulatory reach and safety has 
spurred calls for the White House to develop national standards 
to control explosive gas pressure. 
    "Let me be really clear," Democratic Senator Maria Cantwell 
of Washington state told reporters last week. "They should set a 
standard on volatility."  ID:nL2N0WR1KY  
   The National Transportation Safety Board, an independent 
safety agency, has already encouraged a federal standard for 
"setting vapor pressure thresholds" for oil trains citing 
Canadian findings linking such pressure and the size of 
explosions in train accidents. 
    Meanwhile, a leading voice for the oil industry is lobbying 
Congress to resist federal vapor pressure benchmarks. 
    Last week, the American Petroleum Institute urged lawmakers 
to oppose "a national volatility standard" and pointed to an 
Energy Department study that the severity of an oil train mishap 
may have more to do with the circumstances of the crash than the 
volatility of the cargo. 
    That same report said much more study was needed to 
understand volatility of crude oil from the Bakken. (For a link 
to the study: http://tinyurl.com/nvjqmxt) 
    The oil industry has said that wringing 'light ends' out of 
Bakken crude may keep a share of valuable fuel from reaching 
refineries. 
    Reuters reported early this month that Transportation 
Secretary Anthony Foxx took his concerns about Bakken oil 
volatility to the White House last summer and sought advice on 
what to do about the danger of explosive gases.  ID:nL1N0W72OK  
    The administration decided that rather than assert federal 
authority it would allow the North Dakota rules to take root, 
according to sources familiar with the meeting. 
 
 (Reporting By Patrick Rucker; Additional reporting by Ernest 
Scheyder in North Dakota; Editing by Tomasz Janowski, Bernard 
Orr) 
 ((patrick.rucker@thomsonreuters.com; +202 354 5858; Reuters 
Messaging: patrick.rucker.reuters.com@reuters.net)) 
 
Keywords: USA OIL/SAFETY