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Diane Bailey’s Blog

Crude Oil Train Boom Headed to California

Diane Bailey

Posted March 19, 2014 in Environmental Justice, Health and the Environment, Moving Beyond Oil

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Oil train.jpgCalifornia’s Senate Committees on Environmental Quality, and Natural Resources and Water are holding a joint hearing on Emergency Response to Rail Accidents today to talk about oil spill response in the event of a crude oil train accident.  This is important given the spate of crude oil train accidents over the past year as oil rail transport has boomed, and as California faces the prospect of new oil rail terminals and up to 25% of crude oil coming to this coastal state by rail (see here, here and here).

It’s good to see the state improving oil spill response planning and resources, including the Governor’s proposal to collect fees from oil rail transport for potential clean-ups.  But we need the state to do more than just mop up oil spills after accidents.  We need a comprehensive review of the public safety implications of all of the new oil terminal proposals before they are built and a focus on human health (in addition to wildlife).

First, does it make sense for the state to invest in new fossil fuel infrastructure like oil rail terminals, when petroleum product use is in decline?  A recent Bloomberg New Energy Finance report predicts at 13 percent drop in gasoline and diesel used in California by 2020 despite a growing population.

Second, if we’re going to bring in crude oil by rail, should we allow new terminals in densely populated areas right next to homes and schools?  That is what’s proposed right now, despite National Transportation Safety Board recommendations for crude oil trains to avoid urban areas.

Third, should the state disclose what these crude oil trains are carrying, how much of it, how often they run and exactly which rail routes they take?  The public has a right to know when mile long trains filled with hazardous cargo are passing by their front porches.

Fourth, if we have choices about which crude oil we import and refine in California, should we make an effort to avoid the very dirtiest and most dangerous crudes?  The California Energy Commission (CEC) and Energy Information Administration report record imports of dirty tar sands to California in recent months.

Fifth, if a rail yard suddenly decides to take 100 car unit trains of crude oil, shouldn’t there be a public process and government oversight to determine whether that is safe and appropriate?  Last week a news report revealed that the Kinder Morgan rail terminal in  Richmond was quietly permitted by the Bay Area Air District to receive mile long crude oil trains every day without any public disclosure whatsoever.  Even the CEC didn’t know about it until a news station broke the story.  In the same story, the Air district stated cavalierly that they’re not concerned about this terminal, which happens to be in the middle of Richmond, a city that has endured significant historic and ongoing pollution form the Chevron refinery and other industrial activities.

These questions should be discussed at the rail safety hearing today. It’s easy to dismiss the public concern over crude by rail safety before an accident happens.  In fact, the town of Lac Megantic, Quebec, may not have been concerned about crude oil trains running through it until the day one derailed, exploded and wiped out the downtown area taking 47 lives last July.

Given that terrible tragedy in Quebec last summer and all the fiery crude oil train derailments since then, the thought of 100 tanker car trains filled with highly volatile, explosion-prone Bakken crude oil going through the densely populated Bay Area ought to give some pause to government authorities. Communities all along crude oil rail routes are waking up to this new reality and they’re concerned. 

It’s encouraging to see some steps to address oil rail risks in other regions.  Albany, New York just placed a moratorium on the expansion of the processing of crude oil at the Port of Albany pending a public health investigation by the Albany County Health Department. The City of Seattle passed a resolution last week urging adoption of state legislation and federal regulations; state assessment of risks; railroad company restriction of petroleum transport through Seattle; and update of City incident response plans to address the potential safety, environmental, and economic impacts of petroleum transport by rail.  Similar efforts are under way in Spokane.

A few weeks ago the Mayor of Benicia called on the Governor to issue an executive order to ensure that the state is prepared to deal with the highly flammable and explosive Bakken crude oil from North Dakota coming into California.  That would be a great starting place for California to get out ahead of the looming oil by rail safety crisis in this state.

 

Additional note: Visiting a Southern California rail yard today, watching trains get built, plenty of DOT-111 tanker cars were in the mix.

tanker cars in Colton 2.JPG

tanker cars in Colton.JPG

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Comments

HaMar 19 2014 10:04 AM

You guys have long stated that Canadian oil by rail is not even economically viable. That is the cornerstone of your argument that oil sand production is contingent on the KXL pipeline.

Now all of a sudden, you are worried about tar sands coming to California by rail. I realize everything you guys say is a joke to begin with, but are you not at least smart enough to coordinate your stories?

MattMar 19 2014 02:11 PM

Ha: You may note that the oil referenced throughout the entire article is about Bakken crude from North Dakota, and not about oil sands from Canada.

HaMar 19 2014 03:59 PM

Try again. The article talks about how Canadian oil by rail is starting to show up.

Diane BaileyMar 19 2014 04:31 PM

We're concerned about increases in rail transport of both Bakken and tar sands crude oil. Over the past year, CEC reported an over 100 fold increase in Canadian crude oil transported to California by rail. The amount coming in is still relatively small; Canadian tar sands by rail appears to make up roughly 1% of crude oil imports in 2013 (according to EIA imports data).

Regarding the costs of rail shipment vs pipeline or marine tanker, it is much more costly but not enough to discourage oil companies from bringing in the much cheaper "price advantaged" dirty crudes. If rail transport incorporated all the appropriate safety precautions that it should, it may become too expensive. In its current form, crude oil rail transport is heavily subsidized by the communities around rail lines who are sacrificing their safety and quality of life.

HaMar 19 2014 06:27 PM

Diane,

The safety upgrades are already happening. But if the oil could move by pipeline instead, wouldn't that be safer and better for the environment? Environmentalists seem to oppose pipelines every chance they get. Hence oil moving by rail.

Also, it sounds like you are confirming that Canadian oil will be produced even if it must be moved by rail and not on KXL. I agree with that assessment. Hence, why oppose a safer, more energy efficient alternative? The only reason I can think of would be that the environmental community is fine with the more dangerous transportation by rail because it will force oil prices higher, making clean energy more competitive. Is that a correct assessment?

Al WisterMar 20 2014 12:43 AM

Diane: The key reason why California refineries (and east coast refineries) what out of state crude oil is because it's cheaper than imported oil. That's not likely to change even if costs, associated with new tank cars and rules, increase. That's the reason Valero wants to bring in oil by rail to it's Benicia refinery; they currently receive oil by pipeline and ship. With Alaskan crude oil on the decline refiners don't want to keep purchasing imported oil to make up for the loss. And crude oil from California is not cheap either, since the state of CA taxes each barrel that is pumped out of the ground. Thus the refiners are doing the same thing any consumer would do and naturally looking for something cheaper. BTW the Kinder Morgan terminal at the Chevron refinery was originally built for unloading ethanol trains brought in by the BNSF Railway from the midwest. Union Pacific Railroad then got the contract and it is now unloaded at another terminal and trucked to the refinery. Kinder Morgan then changed over the unloading racks to off load crude oil. Chevron ALWAYS has had the ability to unload crude oil trains on their property (using different tracks) because from 1973 to about 1988 the refinery received unit trains of crude oil from Utah via the Southern Pacific Railroad. This is probably why the air quality control district seemed unconcerned. What really bothers me about all this is the hysteria. Dangerous and flammable products are moved by rail and truck through towns every day, so why pick on crude oil? Ethanol is more flammable than the "sweet" Bakken crude, yet there is no mention of that in the article, hence this appears to simply be a another anti-fossil fuels article that offers no true solutions and no middle ground.

Diane BaileyMar 20 2014 12:55 AM

Ha, I wish those safety upgrades were occurring quickly - that is not what we're seeing with old railcars and leaky valves. Take a look at this article about a rail car inspector who hears hissing from a tanker car and found dozens of leaks from just one 80 tanker car crude oil train:
http://www.oregonlive.com/environment/index.ssf/2014/02/oregon_safety_inspections_lag.html#incart_river

This afternoon I visited a major rail yard in Southern California, where I saw a lot of DOT-111 tanker cars in service. The DOT-111s are known to puncture easily and spill their contents; they're associated with many of the recent oil train derailments where there are fires and explosions. It's shocking to see them still in use, putting people at risk. I asked the rail yard staff if they inspect tanker cars for leaks. The answer: No.

What advice do you have for people who live near rail lines while they are waiting for safety measures to phase in?

If you want to talk more, please give me a call, 415-875-6100.

Al WisterMar 20 2014 12:59 AM

Let me make a quick comment about oil from Canada, especially from Alberta. Not all heavy, sour crude oil from Alberta is tar sands crude. In area's south of the principle tar sands region the primary oil is heavy crude, much like what is produced in Kern County. California refineries actually prefer this crude oil because its only a bit more expensive than tar sands crude and produces less by-product, such as sulphur and petroleum coke. While the market for sulphur is good, the market for "pet coke" is slowly declining and refineries are having a harder time selling it. I expect this will limit the amount of tar sands crude that come into California in the future, with most refiners bringing in medium grade crudes from Wyoming, Colorado and West Texas. Sulphur and "pet coke" are "value added" products for refineries but not when they become hard to sell.

Al WisterMar 20 2014 12:24 PM

The rail yard you were at was Union Pacific's West Colton yard. Why was it "shocking" to see the older DOT-111's in service? This is not something that started yesterday as these tank cars have been in service for years, usually assigned to hauling specific commodities. And they won't be taken out of service because there is a shortage of the newer tank cars with head shields...those are now being delivered and are going straight into crude oil service for companies like Phillips66.
The placard on that tank car going over the "hump" isn't red, so it's not crude oil. Various industries get all kinds of chemicals via rail (chlorine, solvents, lube oil, caustic soda, LPG/LNG, ect.). Again, railroads and trucks have moved these products for years with few accidents compared to the amount of cargo moved and which is why all the hysteria over crude oil is misplaced.

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