September 13, 2013

Pan Am Railways official: We label, 'check' cars

She reacts to news that oil in the Lac-Megantic disaster was incorrectly labeled for its volatility.

By Tux Turkel tturkel@pressherald.com
Staff Writer

The one railroad that still is hauling crude oil through Maine said Wednesday that it relies on accurate labeling of tankers' contents to haul cargo safely.

"We always check the cars and do an inspection," said Cynthia Scarano, executive vice president for Pan Am Railways. "But as far as the materials, we have the bill of lading, and that should match up with what's in the car and what the placard reads. Our people don't open cars. We don't load or offload them. We just deliver them."

Scarano was reacting to news from Canada that the oil that contributed to the inferno in Lac-Megantic, Quebec, in July was as volatile as gasoline but labeled as a less flammable class of crude.

Hazardous-material rules in both countries require tank cars to have placards documenting their contents.

Knowing the characteristics of the cargo helps rail workers prepare a train more safely, Scarano said. Tankers with hazardous materials, for instance, could be buffered with boxcars.

The Transportation Safety Board of Canada asked regulators in Canada and the United States to review the procedures used to document hazardous cargo.

That review is under way in the United States. Late last month, the Federal Railroad Administration and the Pipeline and Hazardous Materials Safety Administration stepped up inspections of crude oil cars in North Dakota in an initiative named the "Bakken blitz," for the area's oil deposits. The goal is to make sure shippers are properly labeling rail tankers' cargo.

The news from Canada also highlighted growing concern about whether the chemicals and methods that are being used to extract crude from shale deposits make the oil more flammable and corrosive.

Much of North Dakota's oil is brought to the surface through hydraulic fracturing, called fracking.

The issue is being investigated by U.S. railroad officials, who have expressed surprise that the crude at Lac-Megantic was so volatile. But it's a complicated situation, according to coverage last month on the Bakken.com website.

It noted that the Federal Railroad Administration and shippers are left to guess about the properties of the oil that's loaded for transport, because the information provided to railroads isn't gathered from tests.

The crude oil that exploded in Lac-Megantic came from shale deposits in North Dakota's Bakken field. Bakken crude is the predominant oil moving across Maine, on its way to the Irving Oil refinery in Saint John, New Brunswick.

Pan Am Railways hauled more than 385,000 barrels of crude oil through Maine in March. The Montreal, Maine & Atlantic Railway, whose train derailed and exploded in Lac-Megantic, carried 484,000 barrels across Maine in March, according to state figures.

Rail deliveries of crude to the Irving Oil refinery have dropped substantially in recent months, Scarano said. She attributed the decline to shifting global oil prices more than the fallout from Lac-Megantic.

"We've had only a couple of trains since the accident," she said.

The derailment raises further questions about the adequacy of the so-called DOT-111 tank cars, Canadian authorities said Wednesday. Those cars are the dominant tanker model used in North America.

For years, safety advocates have called for the old-technology cars to be upgraded, to make them more crash- and puncture-resistant.

About 240,000 of the 310,000 tank cars operating today are DOT-111, according to the Association of American Railroads.

Most of the crude oil that Pan Am Railways hauls in Maine is in DOT-111 tankers, Scarano said. The railroad doesn't own the cars; they are leased to the shipper and simply picked up from other railroads where their tracks connect with Pan Am Railways' tracks.

Canada's findings coincide with news last week that U.S. hazardous-materials regulators are taking a first step in ordering the railroad industry to upgrade DOT-111 tank cars.

The industry has long opposed retrofitting existing cars, saying it's too expensive. Instead, it has adopted standards for new cars. Since 2011, crude oil and ethanol tank cars have been built with thicker shells, and with extra protection at both ends and at top fittings.

But the growth of North American oil production, and controversy over building new oil pipelines, has created more demand for rail cars than manufacturers can satisfy.

The volume of crude moving by rail in the second quarter of this year was at record levels, the Association of American Railroads reported recently.

Tux Turkel can be contacted at 791-6462 or at:

tturkel@pressherald.com

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