U.S. energy regulator approves sulfide gas limit in Bakken crude

NEW YORK, June 7 Fri Jun 7, 2013 10:35am EDT

NEW YORK, June 7 (Reuters) - Enbridge Energy Partners is allowed to limit the amount of potentially harmful sulfide gas in crude oil shipped on its pipeline into its Bakken rail loading terminal in North Dakota, the U.S. Federal Energy Regulatory Commission (FERC) ruled late on Thursday.

The company on May 8 had filed a request to limit the amount of sulfide gas in crude received at its Berthold rail terminal within one day after it found extremely high levels of the gas in one of its storage tanks three days earlier.

Plains All American, Murex Petroleum Corp, Hess Corp and Marathon Oil Corp had each filed so-called motions to intervene in Enbridge's request, some of whom cited concerns about how it will affect their business.

The high levels of gas discovered violated government safety regulations, FERC said, and the agency placed the rule into effect as of May 9.

Enbridge "reserves the right to reject crude that does not contain a hydrogen sulfide content of 5 parts per million (ppm) or less," FERC said. Under certain circumstances Enbridge could accept crude with higher levels, the commission said.

Enbridge at one point had said if the amount of the hazardous gas could not be limited, it may be forced to shut its 80,000 barrel-per-day oil-loading rail terminal.

Shipping crude oil by rail out of North Dakota has more than doubled in the last three years due to a lack of pipeline capacity connecting the state to refining markets.

The U.S. Occupational Safety & Health Administration (OSHA) "sets maximum exposure limits at either 10 or 20 ppm" with an "absolute prohibition of exposure above 50 ppm," FERC noted.

Exposure to sulfide gas vapors at levels of 100 ppm can cause death. Enbridge found 1,200 ppm in one of its storage tanks. Exposure to "hydrogen sulfide levels of 700-1000 ppm causes rapid unconsciousness, or immediate collapse within one to two breaths and death within minutes."

Shippers may file a complaint if they think Enbridge's procedures "are insufficient or are operating in a discriminatory manner," FERC said.

The FERC realizes that placing such regulations into effect and providing only one-day's notice to do so may cause "some difficulties for shippers."

In this situation, "the Commission must place health and safety concerns above commercial matters," it said.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

Find your dream retirement town

Florida? Hawaii? Reuters has teamed up with Zillow to give you the power to customize a list of your best places to retire.  Video | Full Article