By Patrick Rucker
WASHINGTON Feb 26 Oil companies handling
volatile fuel out of North Dakota's energy patch must consider
the dangers of flammable gas carried in the kind of oil-by-rail
shipments involved in a string of fiery derailments, a U.S.
regulator said on Wednesday.
Fuel produced in North Dakota's Bakken region is typically
classed crude oil, but the liquid might be so gas-packed that it
needs to be treated more carefully on the tracks, said Cynthia
Quarterman, who oversees dangerous cargo as head of the Pipeline
and Hazardous Materials Safety Administration (PHMSA).
"Do you have a flammable liquid? A flammable gas? Maybe
there are multiple constituents and you have to determine what
the appropriate packaging is," she told a congressional hearing
on rail safety.
One area of concern has been how fuel is handled as it moves
from fields to refiners and whether existing rules for hazardous
material account for volatile gas that can build during such
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 Representative 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:)
MISHAPS AND TESTS
Officials have been scrutinizing North Dakota rail shipments
since a derailment in July in the Canadian town of Lac Megantic
killed 47. Two further fiery derailments prompted more scrutiny.
Hess Corp, Marathon Oil Corp and Whiting
Petroleum Corp were fined early this month for
misclassifying fuel shipments.
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, Quarterman told a panel
of the U.S. House of Representatives Transportation Committee.
PHMSA, part of the Department of Transportation, is principally
responsible for the safety of U.S. rail cargoes.
Although 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 such as propane moves in the same shipment
as flammable liquids such as 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 that are the workhorse of oil-by-rail
On Tuesday, the Department of Transportation ordered
stricter testing of North Dakota fuel carried on the rails.
Jack Gerard, president of the American Petroleum Institute,
told lawmakers on Tuesday that the emergency order was too
"The emergency order, from our standpoint, creates
confusion," he said, since regulators did not say precisely how
frequently crude should be sampled.
Shipments out of the Bakken are routinely carried on
deliveries of 100-unit tank cars that can carry more than 600
barrels of fuel.
Quarterman said her agency would work with the oil industry
to help it comply with the emergency order, and Representative
Kevin Cramer of North Dakota said the kinks could be worked out.
"It does leave room for the industry to work with the
regulators to fine-tune it," he said.
More than 70 percent of oil leaves North Dakota by rail but
that number should go down, he said.
"I guess I would like to see at least half of our oil moving
by pipelines in the next five years or so," he said. "But that
is going to take a real lift."