INSIDE ENERGY: Crude Oil By Rail: On The Rise In Colorado And Everywhere
The transport of crude oil by rail has spiked dramatically in recent years. From 2012 to 2013 the amount carried by the country's major freight railroads increased nearly 75 percent, according to the American Association of Railroads. Even though crude oil accounted for just over 1 percent of overall rail traffic last year, there's growing public concern about the potential oil spills and other hazards.
This increase in crude oil by rail is playing out across Colorado’s Niobrara formation along the eastern plains, with resource-rich Weld County being ground zero. As the state’s oil production boom continues—exceeding the capacity of pipelines that traditionally have carried the oil—more companies are shipping crude by rail.
Over the past two years, rail companies have built two crude loading facilities and doubled capacity at a third site in Weld County. And, for the first time in nearly a decade, this region recently experienced a crude oil tanker derailment. On May 9, six cars of a 100-car Union Pacific train derailed south of Greeley, Colorado, spilling about 5,000 gallons of oil.
The event caught the attention of Weld County’s Office of Emergency Management.
“We really want to be able to say, OK we know individually at least from our county standpoint of what’s being transported through, whether it be crude oil, whether it be other chemicals like chlorines, and hydrous ammonias—those types of things,” said Roy Rudisill, office director.
Rudisill said when his team encountered the oil spill one month ago; he was surprised his agency wasn’t near the top of the railroad’s notification list.
“Having those conversations and having this incident has actually helped in the communication of if there’s another incident, we know how to get the proper communication—the right information during the incident,” said Rudisill.
A New Federal Rule
Federal regulators are especially concerned about shipments of crude oil from the Bakken formation in North Dakota, Montana and parts of Canada. That wasn’t the oil involved in the Greeley spill. But Bakken crude is believed by some to be more volatile – and connected to fiery tank car accidents—one of which killed 47 people in Quebec in 2013.
“Up until this time we’ve had a real problem in that local emergency responders have had almost no idea of the contents of the trains that were rolling through their communities,” said Lloyd Burton, a University of Colorado professor who studies rail transport of hazardous materials.
Burton said the new Department of Transportation rule is a good start. The rule requires railroads share route details and the amount of oil carried in shipments of 35 or more train cars. It only applies to shipments of Bakken crude.
“I think that that would be something that in my view that railroads just owe the communities,” said Burton.
But that information may be something many communities will never get. A number of states have signed agreements with the railroads to not make the information public. The railroads say it’s a security and competition issue. Wyoming has signed a nondisclosure agreement with Union Pacific Railroad. North Dakota and Colorado have not signed.
“We have to balance everything with guidance we receive from the Department of Transportation,” said Colorado’s Director of Emergency Management, Dave Hard. “It’s important for us to follow federal guidance that’s been provided by the Department of Transportation.”
In Colorado, Hard said shipment details will only be released to emergency responders, specific state and local government officials.
Details On Non-Bakken Shipments Scarce
When it comes to transport of non-Bakken crude in Colorado, few details are known or revealed by railroads to the public. Union Pacific Railroad declined to share information. BNSF Railway — the nation’s largest oil by rail shipper — said on average it operates three crude oil trains per day through Colorado. In 2013, BNSF averaged eight crude oil unit trains across all shale plays on its network, which spans from North Dakota to Texas. (To see more on crude oil shipments, see this data post analyzing the who, what and where of crude by rail in the U.S.)
So, Director of Weld County’s Office of Emergency Management Roy Rudisill said he is able to access historical shipment information from railroads through his county. He uses the information to plan for emergency scenarios.
He said what keeps him up at night are the things he says he hasn’t planned for.
“You hope you plan everything. But somewhere along the line, there’s always something that is going to come up,” said Rudisill.
The cause for the Greeley accident is still under investigation. The team is expected to wrap up its work by the end of July.