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Bakken Crude Rail Safety Exercise Draws Flack

More than 150 local, state and federal representatives from 20 agencies and first responders conducted a tabletop crude oil rail emergency exercise in North Dakota earlier this month. It involved testing how the various segments would handle a derailment and explosion involving Bakken crude.

Industry and state officials have cited a third-party report released in May by the North Dakota Petroleum Council (NDPC) that found the plentiful North Dakota light sweet crude is no different than similar oil produced in other basins (see Shale Daily, May 21). However, the June 18 emergency exercise lauded by North Dakota Gov. Jack Dalrymple also sparked concerns from at least one citizen who wants all natural gas liquids (NGL) stripped out of Bakken crude before the shale play's oil is transported by rail.

The emergency exercise included Fargo at the far eastern edge of the state, near Casselton, ND, which was the scene of a fiery derailment and explosion of a crude oil tank car train at the end of last year (see Shale Daily, Dec. 31, 2013). The tabletop exercise dealt with a similar hypothetical derailment and explosion causing numerous fatalities and was based at the North Dakota Department of Emergency Services operations center with videoconferencing links to Fargo and Bismarck emergency operations centers.

Contrary to concerns raised by federal regulators in the past year after a series of crude rail car mishaps in Canada and the United States, the NDPC's independent study by Turner, Mason & Co. concluded that Bakken crude is consistent throughout the basin with only "minor geographic variability" in gravity.

Also in May, the American Fuel & Petroleum Manufacturers issued a report commissioned by the U.S. Department of Transportation (DOT) that also found crude oil from the Bakken was not significantly more dangerous than other crude that is transported by rail (see Shale Daily, May 15).

Nevertheless, that is not enough to satisfy critics, such as Ron Schalow, owner of a Fargo marketing and advertising firm. Schalow in various forums has advocated that the state require the removal of NGLs from any Bakken crude being shipped by rail.

While not wishing to comment directly on Schalow, who is critical of the state's and NDPC's handling of the crude rail issue, a spokesperson for the NDPC said there have been at least three separate studies completed recently that show Bakken crude "falls well within standards for transport by rail" of hazardous materials.

Schalow is challenging the state to require NGL stripping, as is done in the Eagle Ford voluntarily by producers who have a ready made market on the Gulf Coast among refiners and others to soak up the liquids. North Dakota is far removed from the major liquids markets (see Shale Daily, May 27).

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