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North Dakota State, Industry Officials React to Oregon Crude Train Derailment

Rail transport of Bakken crude oil is again in the spotlight following the derailment of 16 of 96 Union Pacific Railroad (UP) crude-hauling tank cars in Oregon last Friday just east of the Columbia River Gorge.

The accident site is being cleared of all oil spillage and the tank cars, all of which are the older C-1232 models, while community concerns and a wastewater treatment plant sewage pipeline damaged in the incident are both resolved separately, a Sacramento, CA-based UP spokesperson told NGI's Shale Daily late Monday.

The preliminary speculation is that the cause was a faulty track attachment to a rail tie, and not anything related to the engine or the 96 oil tank cars, the UP spokesperson said. There is no estimate how long it will take to clear the site, finish the investigation and repair the sewage pipe connected to a wastewater treatment plant serving the town of 440 residents in Mosier, OR.

Normal rail operations are resuming with a 10 mph speed restriction in the area, and no new oil shipments are planned at this time. When they do resume, local authorities in the Mosier area will be notified in advance, the UP spokesperson said.

Local officials in and around Mosier, close to Hood River and the Dalles, voiced concerns about oil rail shipments through the area, particularly fears about Bakken crude being more volatile and explosion-prone than other crude supplies. Nevertheless, North Dakota Petroleum Council (NDPC) and the Department of Mineral Resources (DMR) reiterated that studies initiated two years ago concluded the Bakken supplies were no different than other crudes (see Shale DailyMay 21, 2014).

NDPC officials cite two studies completed after a series of crude train derailments in 2013, including one in eastern Canada in the town of Lac-Megantic (see Shale DailyJuly 9, 2013). Upgraded federal standards and state requirements on testing Bakken crude's content have been put in place.

"Our accident investigation experience, from the ones that we have looked at, has not indicated that volatility is a significant issue," an NDPC spokesperson told NGI's Shale Daily on Monday. "The biggest contributor to a large explosion or fire is how much product is released rather than the volatility of the product."

In addition, federal officials in the Pipeline and Hazardous Material Safety Administration and the Department of Energy previously have testified to Congress that Bakken crude is generally the same as other light, sweet crude oils. Both the American Fuel and Petrochemical Manufacturers and Turner Mason & Co. engineering consultants did separate studies that confirmed this conclusion.

State officials noted that for the past 12 months or more, North Dakota has been requiring producers to use on-site conditioning applying state Industrial Commission (IC) prescribed temperatures and pressures on Bakken crude supplies to produce a consistent product prior to the shipment (see Shale Daily,Dec. 11, 2014). "So far, we've seen a roughly 99% compliance rate," said a spokesperson from the IC's DMR, which regulates the oil/gas activities in the state.

Any oil that does not meet content compliance standards must be reconditioned and retested within 48 hours of its failing initial tests, the DMR spokesperson said.

More recently, federal railroad oversight officials indicated that the energy industry needed to do more to control the volatility of oil and other fuels transported by the nation's railroads. Sarah Feinberg, acting head of the U.S. Department of Transportation's Federal Railroad Administration reinforced this notion last year (see Shale DailyMarch 18, 2015).

"At this point, preliminary indications point to an unusual failure of a fastener that connects the rail to the railroad tie," the spokesperson for UP said.

By last Sunday most of the derailed tank cars, four of which burst into flames, in Oregon had been removed and the remaining oil was being hauled away by trucks, according to a report from UP. But there is no set timetable for completing the cleanup and restoration work, the UP spokesperson said.

After rerouting trains shipments since the accident, UP resumed operations on the line as of Sunday night, the spokespersons said. "There will be no new crude rail trains in the near term, and we will inform the community when we plan on doing that."

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