Saturday, July 19, 2014

Buffett Tank Car Maker Urges New Rules Include Rail Operations

Buffett Tank Car Maker Urges New Rules Include Rail Operations

Bloomberg  ,   Jul 18, 2014

Warren Buffett’s Union Tank Car Co., which makes cars that carry crude oil, is urging U.S. regulators to adopt new rules for rail operations in addition to sturdier tank-car standards to improve safety.

The railroad procedures need more scrutiny because most crude-oil derailments were triggered by rail operators’ actions or their infrastructure, according to a July 11 letter signed by Union Tank Chief Chief Executive Officer Kenneth Fischl and the CEO of lessor GATX Corp (GMT), Brian Kenney.

“The quickest and most meaningful way to improve crude-by-rail safety is to approve new regulations regarding railroad operating procedures and classification and testing of flammable liquids,” according to the letter the CEOs wrote to Cynthia Quarterman, chief of the Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.

The letter shows the push back from oil tank car owners against an agreement between railroads and shippers through their trade groups that focuses mostly on a new tank-car design and the modification of older ones, which could cost as much as $60,000 per car.
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