May 2, 2014 / 6:10 PM / 5 years ago

UPDATE 2-Oil-by-rail sector mostly ignoring call for data -US officials

(Recasts, adds background, comments from Hess, Enbridge, API)

By Patrick Rucker

WASHINGTON, May 2 (Reuters) - Few oil-by-rail shippers have heeded calls for information to prevent dangerous mishaps on the tracks, the U.S. Department of Transportation said on Friday as it named the three companies it said have cooperated.

Testing data has so far been tallied from Exxon Mobil , Continental Resources Inc and Savage Companies, the agency said.

Several other companies on Friday said that they would respond or had given data to DOT officials in North Dakota.

“We have shared it with their people in the field, voluntarily,” said John Roper, spokesman for Hess Corp.

Regulators are eyeing North Dakota’s energy patch, known as the Bakken, as the origin of several shipments such as this week’s derailment in Lynchburg, Virginia, in which several tank cars jumped the tracks and burst into flames.

Officials have warned since January that Bakken fuel might be more dangerous on the tracks than other conventional crude oil. Unresolved questions about its volatility have infused a broader debate about oil-by-rail safety.

Crude oil can be transported in a standard tank car, but some industry officials have said Bakken fuel may be more similar to flammable gas like propane, which must be moved in sturdier equipment.

The Department of Transportation this week sent to the White House’s Office of Management and Budget a plan to improve tank car standards for trains carrying highly flammable materials. Details of those proposed rules have not been made public.


A fiery derailment last July that destroyed the center of Lac-Megantic, Quebec, killing 47 people, has been followed by several oil-by-rail mishaps in the United States.

The DOT’s Pipeline and Hazardous Materials Safety Administration sent inspectors into the field last summer to examine the situation.

“They’ve been out there at least five times fairly recently,” said Larry Springer, spokesman for fuel transport company Enbridge, of PHMSA inspections in the Bakken.

Officials fined three oil companies for wrongly handling Bakken fuel in February, but the $93,000 in penalties against Hess, Marathon Oil Corp and Whiting Petroleum Corp have already been modified and may yet be reduced further.

PHMSA has collected more than 80 fuel samples, and officials have said the DOT could offer preliminary findings soon on its review of Bakken fuel.

One trade group, the American Fuel & Petrochemical Manufacturers (AFPM), has tapped a third party to collect data from its members.

The AFPM, voice for the refining sector, has said it hopes that arm’s-length reporting will protect proprietary data while still satisfying regulators.

DOT officials recently singled out the American Petroleum Institute, the leading voice for the oil industry, for failing to deliver on a January promise to share data. An API spokesman on Friday said the group was striving to answer officials’ questions.

Regulators have not received information from Plains All American, the midstream energy company whose 105-rail car shipment caught fire in Virginia this week, or other large shippers and terminal operators including Hess, EOG, Musket and refiners such as Tesoro and Phillips 66 . (Additional reporting by Kristen Hays in Houston; Editing by Ros Krasny, Sandra Maler and Prudence Crowther)

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