Cars

There is no slippage in the push to build more railroad tank cars for transporting crude oil and other energy products, the CEO of a leading railcar manufacturer told financial analysts.

While it has a phase-out process running into 2017 for old (DOT-111) rail tank cars that carry crude oil, Canada’s Transport Department (CTD) has accelerated the process by banning nearly 3,000 of the older model cars from carrying “dangerous goods” throughout the nation.

Preliminary results of an industry-backed study show that crude oil from the Bakken/Three Forks formation poses no more risk in rail shipment than other fuels. The report, unveiled Tuesday at the Williston Basin Petroleum Conference, is the second this month with the same findings.

Twenty-one cars of a 118-car crude-by-rail train owned by Norfolk-Southern Corp. (NS) derailed on Thursday near Vandergrift, PA, with up to 4,000 gallons of oil said to be leaking from four cars. NS officials were on the scene and responding, a spokesman said.

The growing emphasis on shipping U.S. crude oil production by rail will continue and the oil sector welcomes tougher safety standards now being contemplated by the federal Department of Transportation (DOT), several oil executives said Wednesday during 4Q2013 earnings conference calls.

In the wake of two derailments involving tank cars loaded with crude oil, and concern over an expected increase in crude oil shipments by rail, Canadian regulators have proposed tougher construction standards for tank cars and additional certifications.

Cargoes from and to the U.S. oil and gas patch are filling up a lot more rail cars than they were one year ago, according to data from the Association of American Railroads (AAR), continuing a trend of increasing rail crude oil movement that began in 2009.

The railroad transportation of Bakken oil supplies continues to grow, and transporters are investing in new facilities on a pace with pipeline takeaway growth, according to the latest statistics from the North Dakota Department of Mineral Resources (DMR) and the state pipeline authority.

American Honda Motor Co., which bills itself as the only automaker selling natural gas-powered passenger cars in the United States, wants to double its sales of its compressed natural gas (CNG) Civicmodel, which is built in Indiana. To boost sales it is going to establish CNG fueling stations in some of its dealerships, particularly in California. The automaker said it is negotiating with California regulators about developing more fueling stations in dealerships in a state that represents the nation’s biggest CNG vehicle market. The company said it is usually not Honda’s role to create infrastructure, but in this case a “chicken and egg” situation exists, “and we’re going to have to nurse the egg along.”