04.28.15

Cantwell Secures DOE Commitment to Study Oil Volatility

Secretary Moniz announces research with DOT; says data also needed on effects of crude-by-rail shipments on other commodities

WASHINGTON, D.C. – In response to questions from Senator Maria Cantwell (D-WA) about the safety of increasing rail shipments of flammable crude oil, U.S. Department of Energy Secretary Ernest Moniz said his agency plans a two-year study into how crude oil properties affect its combustibility in rail accidents.

The Energy Department will partner with the U.S. Department of Transportation (DOT) on the study, Moniz said during Tuesday’s hearing of the Senate Committee on Energy and Natural Resources. Tuesday’s hearing focused on the Obama administration’s Quadrennial Energy Review (QER), a first-ever review of energy infrastructure that identifies threats, risks, and opportunities for U.S. energy and climate security.

“A number of high-profile incidents have underscored major safety concerns,” said Cantwell, the committee’s ranking member. As the QER notes, “these accidents have highlighted the need for additional monitoring, enforcement, and inspection, and new safety design requirements for tank cars.”

Moniz and DOT Secretary Anthony Foxx agreed to fund a research project with a “focus on what the implications will be for testing and understanding how crude oil properties affect things like combustibility in accidents,” he said. It will follow a Sandia National Laboratories report, which is the “most comprehensive literature survey in terms of properties of different oils” to date, and showed a need for further research, Moniz said.

In March, Cantwell introduced the Crude-By-Rail Safety Act of 2015 with Senators Patty Murray (D-WA), Tammy Baldwin (D-WI), and Dianne Feinstein (D-CA). The legislation requires the Pipeline and Hazardous Materials Safety Administration to establish new regulations to mitigate the volatility of gases in crude oil shipped via tank car. It also would immediately halt the use of older-model tank cars that have been shown to be at high risk for puncturing and catching fire in derailments.

There have been four fiery derailments involving oil trains since the start of February. No injuries were reported, but a July 2013 derailment in downtown Lac-Mégantic, Quebec, resulted in 47 deaths.

Cantwell asked Moniz about how the Energy Department plans to address other consequences of the exponential increase in crude-by-rail shipments, such as delays in the shipments of other commodities.

“Crude oil now competes with other commodities more traditionally transported by rail, which has caused delays in the delivery of crops and agricultural products to market,” Cantwell said. “The report explicitly states that these recent unexpected shifts in supply and demand for rail services has resulted in disruptions to agricultural shipments ‘exceeding even those caused by Hurricane Katrina’.”

In Washington state, Cold Train, an intermodal agriculture shipper in Quincy, announced in 2014 that it had suspended rail service due to increasing delays on rail lines and a near-doubling of transit times – in part due to oil trains hauling Bakken crude from North Dakota.

Moniz said the Energy Information Administration will collaborate with DOT to compile data on the movement of energy commodities such as oil and ethanol. Data needed to examine the problem is sparse, he said.

“We recommend a collaboration with other departments, including the USDA and others to have a more unified commodity database,” Moniz said. “There’s a competition often right now for moving multiple commodities and we would like to get a multi-agency approach to that.”

Five years ago, railroads hauled almost no crude oil. Now, more than 1.1 million barrels per day – with more expected – move by rail, largely originating in the Midwest. Washington state is the fifth-largest refining state in the U.S. and a destination for increasing quantities of crude-by-rail from North Dakota shale fields. The DOT estimates an average of 10 derailments annually over the next 20 years as crude-by-rail shipments grow, costing $4 billion.

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