UPDATE 1-U.S. lawmakers to question oil-by-rail safety; tank cars a concern

Wed Feb 26, 2014 11:46am EST

By Patrick Rucker

WASHINGTON Feb 26 (Reuters) - U.S. lawmakers are expected to question regulators and rail industry officials on Wednesday about several recent fiery derailments, focusing on whether crude oil shipments from energy-producing regions such as North Dakota's Bakken area are being handled safely.

A subcommittee of the House of Representatives' Transportation Committee will hear from the officials with the rail and oil sectors as well as U.S. Department of Transportation officials responsible for safe shipments. The hearing is due to start at 2 p.m. EST (1900 GMT).

"We need to understand what government agencies and transportation stakeholders are doing to ensure safety on the system," said Rep. Jeff Denham, a California Republican who will convene the panel.

One area of concern has been how fuel is handled as it moves from fields to refiners and whether hazardous material rules account for pressure that can build during such deliveries.

Existing hazardous material rules envision a test for the initial boiling point of crude oil and the liquid's flash point, or the temperature at which it will combust with a spark.

But the rules do not require a test for pressure and some lawmakers and Congressional staff say that is a blind spot in the regulations that should be addressed.

"The pressure and volatility of these shipments have not been getting enough attention," said Rep. Rick Larsen, whose district in Washington state is home to a Tesoro Corp refinery that routinely receives shipments of oil from the Bakken region on railcars.

In March, a Tesoro executive reported that its refinery in Anacortes, Washington, was seeing pressures climb on its Bakken rail shipments. (for full report see:)

Officials did not test vapor pressure on crude oil samples that led to fines against Hess Corp, Marathon Oil Corp and Whiting Petroleum Corp early this month.

The companies were later cited for wrongly classifying cargo tanks hauling fuel from the field to a railhead in October, and a DOT official said tank car pressure was now being scrutinized more closely.

"This market is evolving fast, and people are demanding that we get clear answers on the dangers," said Larsen, who has heard from communities along the oil-by-rail route in his district.

Officials have sampled Bakken crude oil 58 times in recent months to help understand the hazards it poses, and found many more examples of potential violations, said Cynthia Quarterman, who heads the Pipeline and Hazardous Materials Safety Administration (PHMSA).

"Tank cars are only one part of the chain of delivery and we must identify and evaluate all of the risks associated with the bulk movements of highly hazardous materials," Quarterman said in prepared remarks. PHMSA is principally responsible for the safety of U.S. rail cargoes.

And while hazardous liquids do not require a test for pressure, shippers must weigh all risks when they classify fuel on the tracks, officials said.

"The regulations are clear," said Bill Schoonover, PHMSA's Deputy Associate Administrator for Hazardous Materials Safety. "A person must account for all hazards present if more than one hazardous material is being transported in a container."

If flammable gas like propane moves in the same shipment as flammable liquids like crude oil the cargo should typically be treated as the more dangerous of the two substances, Schoonover said.

Propane is packaged in pressurized tank cars rather than standard DOT-111 cars.

Among others due to speak on Wednesday are top oil industry lobbyist Jack Gerard, president of the American Petroleum Institute, and Edward Hamberger, president of the Association of American Railroads.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.