Inside Energy: Making Bakken oil safer

Sep 29, 2014

Oil trains are one of the clearest connections between the Bakken oil field in North Dakota and regular Americans.

In 2008, no oil left North Dakota by train. Now, over 700,000 barrels a day do. The trains run next to homes and through downtowns from Colorado to Virginia. And when they derail and explode, the consequences can be deadly.  Now, there’s pressure on regulators in North Dakota to make the oil less flammable.

From Prairie Public, Emily Guerin reports.

GUERIN: In June, emergency managers and first responders in Bismarck, North Dakota ran through a frightening scenario. What if an oil train derailed downtown?

GARY STOCKERT: Depending on the proximity, the assumption was the some of the buildings were devastated or destroyed completely.

GUERIN: Gary Stockert is the city’s emergency manager.

STOCKERT: And we are standing at the corner of 12th and Main.

GUERIN: Ground zero for the hypothetical train crash. Right next to a hospice, a dry cleaner and a fancy restaurant.

STOCKERT: We also assumed we had as many casualties as what they had in Quebec during that incident.

GUERIN: The incident in Quebec is, of course, Lac Megantic. Where 47 people died in July 2013 (twenty-thirteen) when a train carrying North Dakota crude oil derailed and incinerated the downtown. Since then, cities with oil train traffic have been preparing for the worst. About 10 oil trains with 100 cars each leave North Dakota every single day,
passing through big cities like Seattle, Denver and Minneapolis on their way to refineries on the coasts. That means lots of people who see no benefit from the oil boom are having to live with increased risk.

DAVE CHRISTIANSON: Governor Dayton in Minnesota is concerned primarily about the safety of people along oil train routes, and in particular about the fact that this is a very volatile oil.

GUERIN: Dave Christianson is a senior planner with the Minnesota Department of Transportation. He says 70 percent of North Dakota’s oil passes through his state...So Minnesota is strengthening railroad safety rules there. But they can’t do anything about what’s in those tank cars.

CHRISTIANSON: That is something that is under control of the state of North Dakota to a large degree.

GUERIN: So Minnesota’s governor has asked North Dakota’s governor to step in and require oil companies to make the oil safer.

CHRISTIANSON: The oil companies are the ones making most of the profit. So we feel the parties who are profiting from it should be responsible for part of the expense.

GUERIN: Not surprisingly, that’s not at all popular with the industry. They made that very clear at a recent public hearing in Bismarck about proposed regulations - regulations that would make industry remove the most flammable liquids from the oil before it’s loaded onto trains.

KEITH LILIE: My name is Keith Lilie, I’m the operation and maintenance manager for Statoil in the Austin office.

GUERIN: The room was full of oil executives from Texas and Oklahoma wearing suits and cowboy boots.

BRENT LOHNES AND ROGER KELLY: My name is Brent Lohnes, I’m the director of field and plant operations for Hess Corporation. My name is Roger Kelly, I work for Continental Resources, offices at 20 North Broadway, Oklahoma City.

GUERIN: They testified that the oil was already safe, that train accidents were few and far between, and that regulations would cost the industry a lot of money…After listening to hours of testimony - nearly 100 percent against new rules - I pulled no I here Eric Baez aside. He’s the general manager of Oasis Petroleum in North Dakota. He came up with another reason why the industry doesn’t like the idea….

ERIC BAEZ: Cost is certainly one concern. But you create another product stream that you have no infrastructure in place for.

GUERIN: What he’s saying is: North Dakota doesn’t have enough pipelines to move all the oil--once you separate the flammable liquids, you have a whole new product you need to ship someplace.

SOUND OF STREET UP

GUERIN: Back in Bismarck’s hypothetical ground zero, I asked emergency planner Gary Stockert if people living near the tracks should be concerned. Well, he told me, there’s a lot more oil trains than there used to be.

STOCKERT: It obviously increases the likelihood of something occurring just because you have higher numbers. Higher numbers create higher risk.

GUERIN: North Dakota officials say they’ll decide whether to pass new regulations by the end of the year. And the federal government is considering ways to beef up the tank cars that carry crude oil. Until then, oil production here keeps rising. And that will likely mean more oil trains -- and more worrying -- in cities around the country.

For Inside Energy, I’m Emily Guerin in Bismarck, North Dakota.