Stagnant wholesale power prices have…
The narrative that the U.S.…
The stricter new safety standards being imposed by US and Canadian officials on trains hauling crude oil aren’t sitting well with either the rail industry or with environmentalists, who are considering lawsuits to fight parts they disapprove of.
In Washington on May 1, US Transportation Secretary Anthony Foxx and Canadian Transport Minister Lisa Raitt announced the new regulations, which will require shippers to reinforce the tank cars containing crude and other flammables in North America by Oct. 1. Older cars will have to be upgraded within a few years or taken out of service.
The rules also will require that the cars be equipped with a new electronic braking system on some trains by January 2021.
Related: How Much Would Zero Emissions Cost?
Environmentalists and safety advocates have been urging both countries to mandate reinforced tank cars for years, especially since a runaway oil train exploded in the Quebec Township of Lac-Mégantic on July 6, 2013, killing 47 people. This was only one of several such accidents in North America, though none of the others were fatal.
“Since 2008, we’ve seen a staggering, staggering, 4,000 percent increase in the transport of crude by rail,” Foxx said, because of the increased production of oil from US shale and Canadian oil sands. But he stressed that 99.9 percent of those oil shipments reach their destination safely.
Still, Foxx added, “The accidents involving crude and ethanol that have occurred, though, have shown us that 99.9 percent isn’t enough. We have to strive for perfection.”
Related: Oil Field Services To Bear The Brunt Of Price Collapse
The rail and energy industries say this is no way to improve safety. Edward Hamberger, president and CEO of the Association of American Railroads, said in a phone call with reporters on May 1 that regulators are imposing the new braking system based on what he says is an inadequate study of braking systems.
“How does that stack up against the president’s call for good common-sense regulations when you’re basing a regulation on a study that the author himself says ‘should be taken with a grain of salt’?” he asks.
David Friedman of American Fuel and Petrochemical Manufacturers says the regulations will do little to prevent derailments. “These tank cars don’t breach unless they’ve gone off the tracks,” he said, “so our message continues to be that we’ve got to keep the cars on the tracks.”
Related: Oil, The Fed And The Ugly Truth About Capital Markets
Environmentalists are also challenging the new rule allowing a delay before reinforced tank cars are required, leaving open a window of time for even more accidents.
Existing tank cars hauling crude from the Bakken shale formations bordering western areas of the United States and Canada must comply with the new rules within five years. But these cars can continue hauling other forms of crude oil, as well as ethanol, for an additional three years after that without undergoing any retrofitting.
A group of environmental groups including the Sierra Club, Earthjustice and the National Resources Defense Council said the delay would threaten not only the environment but also public safety. “We are seriously considering challenging the rule, in particular the very long phase-out period,” said Patti Goldman, managing attorney for Earthjustice in Seattle.
By Andy Tully of Oilprice.com
More Top Reads From Oilprice.com:
Andy Tully is a veteran news reporter who is now the news editor for Oilprice.com