Posted on 01/15/2014 3:09:22 AM PST by thackney
Regulations that could force oil companies to use stronger rail cars to move crude likely will be ready in 2015, according to a schedule released Tuesday by the U.S. Department of Transportation.
Oil companies have increasingly used rail cars to move crude, but recent disasters, including a derailment and massive explosions in North Dakota last month, have drawn attention to the cars’ vulnerabilities. New regulations that could force older tank cars to be upgraded or phased out are under development, but will not be proposed until Nov. 12 and will be subject to a public comment period until Jan. 12, 2015, according to the Department of Transportation.
However, that initial timeline could shift as the process continues, said Pipeline and Hazardous Materials Safety Administration spokesman Gordon Delacambre.
Recent derailments and explosions, including one in Quebec that killed 47, have involved tank cars widely thought to be weak.
The National Transportation Safety Board on Monday drew more concern about the tank cars, reporting that 18 of the 20 tank cars that derailed in the North Dakota incident were punctured. The NTSB also confirmed that the tank cars involved in the incident were an aging model that has drawn scrutiny for being especially vulnerable to punctures.
Weak shells
The board has for years said the widely used DOT-111 rail tank cars are weak and should be retrofitted or phased out because they experience more serious damage in accidents than other models, such as pressure tank cars. The difference “can be attributed to the fact that pressure tank cars have thicker shells and heads,” the agency’s chairwoman, Deborah Hersman, wrote in a letter to the Pipeline and Hazardous Materials Safety Administration in 2009.
The Department of Transportation’s Pipeline and Hazardous Materials Safety Administration sets regulations for the rail cars.
About 85 percent of the 92,000 tank cars used to transport flammable liquids in the United States are DOT-111s or other car types that need to be phased out or upgraded, according to the American Association of Railroads.
Comments and proposals
Regulators have solicited comments about the potential regulations and have begun analyzing proposals that would address concerns about the DOT-111 tank cars, Delacambre said.
Despite increased calls for updated regulations following the Dec. 30 derailment in North Dakota, the regulations will take months to develop. Railway workers and companies have been among those calling for new regulations.
Railways typically do not own the rail cars used to hold oil. The cars typically are owned or leased by the companies shipping products by rail.
It’s really the grace of God that we don’t get terrorist oil train assaults. Yet. When they talked about puncture resistance, I immediately thought, what might puncture it. The answer is obvious, and you’d need to be built like tanks to guard against deliberate trouble makers.
Its also sounds one of those things that it would be easy to not get caught doing it.
Long before considering the uparmoring of rail stock, I would be looking at the financial impact on rail companies, and the rise in price for refined products as a natural consequence to the demand for stronger cars by a federal government not known for fiscal responsibility.
Let’s just make a guess that Warren Buffett already has a contract to build them
This type of regulatory tyranny is designed to attach the weights of increased costs on our energy industry. A little oil spilled is little consequence compared to the increased costs to prevent it. There is more engine oil dripping out of our transportation vehicles than we can imagine.
Let’s be real....How many times has this happened??
Let’s be real....How many times has this happened??
The bigger question in my mind is: How effective will the "solution" be? If the government imposes these regulations and then railcars end up spilling oil in most derailment or collision incidents anyway, then what's the point?
If they could get away with it, most local and county governments would (understandably) outlaw the transportation of hazardous materials by rail within their jurisdictions. They are prohibited from doing this because the railroad industry operates under the protection of Federal railroad laws that basically strip state, county and local governments from interfering with railroad commerce.
When you are an industry that operates under the protection of "regulatory tyranny" to begin with, nobody is going to take you seriously when you complain about the heavy-handed costs of government regulation.
He bought a company that builds rail tank cars.
Warren Buffett Cashes In on Railroad Tank Cars
http://www.businessweek.com/articles/2013-11-14/2014-outlook-warren-buffett-cashes-in-on-railroad-tank-cars
November 14, 2013
Seriously? Maybe you should go to that Quebec town where half the town went up in flames. Then stand in the middle of the town where there is nothing left and say what you just wrote out loud in front of all of the surviving families. Then get back to me.
These old rail cars that have been used for way too many years need to be removed from the rails and replaced with the upgraded tanker cars. Now, I don’t care if it is industry initiative if they are willing or government oversight, but something has needed to be done for many years with these cars.
But these tanks don't wear out real quick so there are a lot of old tanks still in service.
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The American Association of Railroads, which initially expressed reservations about stricter tank regulations, said in November that it supports standards for upgraded tank cars.
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Another part of the problem is past comparisons of the frequency of the accidents do not take into account the large increase in crude oil rail traffic.
Since the oil tank cars are typically owned by the oil company, and the rail company gets most of the blame in accidents, this will help the rail companies.
The new guidelines, put forward in March 2012 but which have not yet been adopted by the Department of Transportation agency that oversees the sector, stem from a deadly ethanol train derailment and explosion in Illinois in 2009.
DOT-111 railcars ordered after October 2011 have been manufactured to the new code, but the industry has resisted spending an estimated $1 billion to retrofit nearly 300,000 existing tank cars.
http://www.reuters.com/article/2013/11/08/us-crude-train-explosion-idUSBRE9A70Q920131108
If they mandate that 85% of all tank cars get upgraded overnight, it will cause a major spike through the energy sector.
Berkshire Hathaway (Warren Buffet) will benefit greatly if this happens as his railroads will have less risk and his rail tank car manufacturing (purchased only months before this proposed change) will boom. Win-Win.
Your comments are stunning. The issue isn’t preventing spilled oil. It’s protecting people’s lives and property. I live in an area of about 300,000 population. Train tracks go through the middle of the west side of town. In the north side of town, the tracks are within feet of homes. There are two small cities to the north. Those same tracks bisect those towns. It’s human lives we’re talking about.
My son works in the industry which repairs and upgrades rail cars. These old tanker cars need reinforced heads. Heads are the ends of the cars right above the point where the cars link together. Sudden impacts, even sudden stops, can cause parts of one car to pierce the head of the car ahead or behind and cause an inferno. Needs fixing.
Where is Cosmo Kramer and his bladder system when you need him?
Are you sure the tanker cars are owned by the oil companies?
The reason I ask is that very few lumber mills own the flatcars or box cars that they load lumber, plywood or osb board on/in. I only know of one mill that has a lease on flatcars.
No company is going to voluntarily replace existing equipment unless either they are forced to because of government regulation or they perceive it will lessen their exposure to lawsuits.
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