New $1-billion railway insurance policy- and other news

 

AIG unveils $1-billion railway insurance policy as crude-by-rail soars 

Eric Atkins  The Globe and Mail  10/09/14

As crude-by-rail shipments soar, insurance company American International Group Inc. (AIG) is offering rail companies a $1-billion (U.S.) cushion against catastrophic derailments.

The casualty-liability policy offered by the New York-based company is believed to be the largest available, and is a sign of the perceived risks involved in the burgeoning business of moving oil by train....

... The $1-billion AIG policy would only kick in once the rail company exceeded $1.5-billion in claims. Until now, AIG’s largest railroad casualty policy was worth $100,000..... read more here

Union Pacific affected now, too, as scrutiny widens over rail shipping delays

Omaha.com   By Russell Hubbard / World-Herald staff writer 10/10/14

Union Pacific and other main freight railroads are now required to join BNSF Railway in filing detailed weekly reports on shipping delays, as federal regulators attempt to cope with complaints from farmers and coal-burning utility plants who say crude oil gets top priority.

The Surface Transportation Board said in a ruling this week that all seven Class 1 railroads with U.S. operations are required to submit weekly information on average train speeds and the amount of time trains spend waiting in terminals, along with a description of operating conditions in Chicago. That city, one of the nation’s busiest rail interchanges, is often cited as a choke point....more here

 

Green groups sue over expansion of California crude by rail

By Rory Carroll  10/09/14

(Reuters) -California environmentalists on Thursday filed a lawsuit against the Kern County Board of Supervisors for its approval last month of a major oil-by-rail project in the state, saying the county failed to disclose the risks of the project to the public.

In September, the board voted unanimously in favor of Alon USA Energy Inc's plan, which would increase the terminal's offloading capacity of crude from railcars to as high as 150,000 barrels per day (bpd) from the current 13,000 bpd.

The $100 million project would also see the reopening of the company's shuttered Bakersfield refinery, which was closed two years ago because it was unprofitable.....

... The Board of Supervisors had conducted a lengthy environmental review of the project. But groups behind the lawsuit, including the Sierra Club and the Center for Biological Diversity, said the board underestimated the risks from increased pollution and the likelihood of catastrophic accidents along the rail routes.

"This dangerous plan would send huge trains full of explosive crude through California communities completely unprepared to cope with a devastating rail accident," said Kassie Siegel, senior counsel for the Center for Biological Diversity.

"Kern County supervisors broke the law by rushing to approve a project that will pollute the Central Valley's air and put thousands of unsuspecting people in the path of these hazardous bomb trains," she said.....read more here  

Train derails in Mer Rouge  

Barbara Leader, The News-Star  Oct 5, 2014      video at site      Updated

MER ROUGE [Louisiana] Two Union Pacific engineers were injured when their train derailed in Mer Rouge early Sunday afternoon after colliding with a truck that was stuck on the tracks....

 "We're lucky that wasn't one of our oil trains that we get 10 times a day," Mer Rouge Mayor Johnny McAdams said. "If it had been an oil train, we would have had a fire and then we would have had fatalities." ..   read more here

Update:  You Tube video of crash

  

Oil-By-Rail To Spur Major Traffic Jams

International Business Times  Sept 29, 2014

By Maria Gallucci - Life is slowing down in Bozeman, a small city in southern Montana near a major railroad. More shipments of Bakken Shale oil and local coal are passing through, and it’s taking drivers more time to cross the tracks and get around town. Fire trucks, ambulances and police cars have to wait while carload after carload chugs along. “It takes longer for those public safety services to get to us,” says Beth Kaeding, a Bozeman resident and conservationist....

... The GAO examined the Department of Transportation’s ongoing to work to establish train safety provisions in the wake of recent derailments and several serious oil accidents, including a deadly explosion in Lac-Megantic, Quebec. The investigators found that officials’ efforts “do not fully consider freight-related traffic congestion,” and that they have failed so far to “fully establish the federal role or identify goals, objectives or performance measures in this area.”....

.... In the Pacific Northwest, the congestion is making it harder for agricultural producers and other suppliers to ship their goods via rail. Last month, the operator of a refrigerated rail service, Cold Train, said it was suspending service at a Washington port due to long delays on rail lines and a near-doubling of transit times, in part because of Bakken crude shipments. The service would have guaranteed to deliver Washington’s apples, cherries and potatoes to Midwest markets within three days, according to the company....

.... The GAO report found that local communities are largely on their own if they want to increase the number of rail crossings, improve traffic signals or take other measures to alleviate the train traffic and reduce the risks of accidents and derailments. Funding is limited in state and local agencies, and private railroad companies aren’t required to pitch in....  read more here

ND prepares to order degasification of oil at wellhead; Farmers and shippers suffer frustration, delays

North Dakota seizes initiative in CBR degasification

Written by  David Thomas, Contributing Editor,     Railway Age 09/04/14

The vital other shoe in crude by rail reform will drop not in Ottawa or Washington, but in Bismark, N.Dak., where, in the void created by federal inaction, officials are preparing to use state jurisdiction over natural resources to order the degasification of petroleum at the wellhead.....

....Division spokesperson Alison Ritter told Railway Age, “The hearing is a first step in conditioning the oil to make it as safe as possible for transport.” She said that gas/liquid separators are already required at all North Dakota wellheads. At issue is whether they are being effectively used to render so-called “hot crude” safe for rail transport.

Separators boil off light hydrocarbons such as ethane, butane, and propane from crude oil, reducing its vapor pressure and propensity to explode. Heavy and corrosive hydrogen sulfide is also removed for pipeline transport. None of this is compulsory for shipment by rail.....read more here

Buffett’s BNSF Chooses Oil Over Farmers, Says Official 

ValueWalk.com  09/05/14

Increased delays cost farmers nearly 40 percent when they sell at market while delays in the Keystone pipeline benefit Buffett & BNSF as dangerous oil shipments by rail increase

As BNSF railroad benefits from increased oil shipping contracts from controversial Canadian tar sands to travel over rail to southern refineries, North Dakota grain farmers are finding it increasingly difficult to get top dollar for their crops due to shipping delays......read more here

'The whole system is suffering': Words of frustration, caution at hearing on rail delays

 September 5, 2014  By Russell Hubbard / World-Herald staff writer   Omaha.com

.....“The whole system is suffering,” said Terry Whiteside, chairman for the Alliance for Rail Competition, speaking in an interview Thursday at a federal hearing on rail delays in Fargo, North Dakota. “Rail speeds are falling nationwide and that should be of concern for all producers.”....

.... the nation is looking at projected record harvests for corn and soybeans, just as BNSF’s average train speed for ag products has fallen 22 percent from a year ago, according to company filings with the board. An average train speed’s worst enemy is congestion, with idle time part of the calculation.

Such delays and the customer service standards of BNSF, purchased by Berkshire Hathaway in 2009, were savaged by frustrated freight shippers at the hearing Thursday......read more here  

Rail shipping disruptions, fees and flammable materials- new stories

Oil trains crowd out grain shipments to NW ports

Seattle Times  July 26, 2014

As oil trains hauling North Dakota crude delay rail transport of grain to Pacific Northwest ports, the prospect of growing fossil-fuel traffic has some fearing that such shipping disruptions will become a long-term problem impeding exports and the regional economy.....

Oregon Oil Train Safety Report Calls For More Rail Inspectors, Fees

Daily Astorian    July 26, 2014

A statewide rail safety report released today identifies gaps in the resources Oregon needs to prevent and respond to an oil train derailment.

The report, ordered by Gov. John Kitzhaber in February, calls for more rail safety personnel and more funds to pay for training emergency responders for an oil train derailment. To help pay for both of those needs, the report recommends charging fees for transporting crude oil by rail through the state.....

Proposed rail transportation safety rules will impact ethanol industry 

Saturday, July 26, 2014   By Robert Pore      Grand Island Independent

Last week the U.S. Department of Transportation released details of its rulemaking proposal to improve the safe transportation of large quantities of flammable materials by rail — particularly crude oil and ethanol.,,,

.... Dinneen expressed concern that the rule paints with too broad a brush and fails to distinguish between products with an admirable safety record — ethanol — and those for which legitimate and serious concerns have been raised — highly volatile crude oil from the Bakken.....