Democrats Mount New Crude Train Safety Push After Derailment

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By Ari Natter

June 10 — Senate Democrats are renewing a push for oil train safety legislation after a fiery crude-by-rail derailment resulting in a spill in Oregon's pristine Columbia River Gorge, but analysts say the incident isn't likely to be enough to spur congressional action anytime soon.

The accident in Mosier, Ore., which resulted in a light sheen of oil on the Columbia River but no deaths or injuries, is the latest in a string of more than two dozen significant fires and spills involving trains transporting oil as the amount of oil being shipped by railroad has increased dramatically over the past five years as domestic oil production has increased.

“We need more rail safety that’s for sure,” Sen. Chuck Schumer (D-N.Y.) told Bloomberg BNA.

Schumer, who is poised to become the Senate's next majority leader if Democrats take control of the Senate in 2017, has called for more stringent federal requirements for trains shipping crude by rail. He is also the author of legislation that would implement new speed restrictions for oil trains traveling in certain areas and require the phaseout of older tank cars by 2020—five years faster than requirements set by the Department of Transportation in May 2015.

“For far too long, the rail and oil industries have taken advantage of the lack of rules by making excuse after excuse to delay phasing-out the dangerous and outdated tanker cars,” Schumer said in statement announcing the Eliminating Dangerous Oil Cars and Ensuring Community Safety Act in May 2015.

Legislation Ready

The bill (S. 1462) would also require the use of new volatility standards opposed by industry for the transport of crude by rail, mandate increased rail track inspections, and require new oil spill response and derailment reporting requirements.

Other crude-by-rail safety bills pending in Congress include legislation introduced in 2015 by Sen. Ron Wyden (D-Ore.) that would require shippers using older tank cars to pay an increasing fee that would reach $1,400 per tank car at the end of 2018. The money would be used for oil spill cleanup, emergency response, and temporary tax credits for upgrading to newer tank cars. The legislation, the Hazardous Materials Rail Transportation Safety Improvement Act of 2015 (S. 1175) which has 11 Democratic co-sponsors, is pending before the Senate Finance Committee.

“I think I’m going to try and push it now,” Wyden told Bloomberg BNA in an interview days after the June 3 derailment in his state.

The crash occurred after at least one bolt used to fasten the tracks to rail ties broke, resulting in 16 of the 96 tank car train hauling oil from the Bakken region of North Dakota to a refinery in Washington state to leave the tracks, Justin Jacobs a spokesman for Union Pacific told Bloomberg BNA. That section of track had been inspected just four days prior to the crash, he said.

Rail Cars Met Current Standards

According to the Federal Railroad Administration, the train cars involved in the leak and resulting fire were jacketed CPC-1232s, newer-model cars which are supposed to be less likely to rupture in an accident. Under Transportation Department's rules for trains carrying oil and other hazardous materials, the tank cars aren't scheduled to be phased out until 2025.

The resulting fire forced residents of Mosier, population 433, to evacuate their homes near the state's border with Washington for days. The area was designated as a National Scenic Area through an act of law signed by President Ronald Reagan in 1986.

“We believe a small amount of oil did potentially make it into the river but that was quickly contained,” Jacobs said. “We put booms around it and we are monitoring it.”

Locals say they consider themselves lucky.

“If this had happened two miles down the track, then all 42,000 gallons of the oil would have ended up in the Columbia river,” Arlene Burns, the mayor of Mosier, said during a conference call organized by the environmental group Stand Up To Oil. “We took the hit as much as possible for the river. It's sort of a blessing it landed in our sewage treatment plant.”

Locals Say They're Lucky

Steve Lawrence, the mayor of the nearby town The Dalles, added on the call that if the crash occurred just five miles to the west in Hood River, a tourist destination known for its wind sailing and local craft breweries, “it would have wiped out the damn town.”

The incident was the first significant oil train crash in the U.S. since November 2015 when more than a dozen cars loaded with crude oil derailed from a Canadian Pacific Railway train prompting the evacuation of dozens of homes near Watertown, Wis.

The amount of oil being shipped by rail in the U.S. increased from 55,000 barrels per day in 2010 to a high of more than 1 million barrels per day in 2014, as domestic oil production boomed, according to the Energy Information Administration. That amount decreased to 891,000 barrels per day in 2015 and has declined roughly 20 percent more during the first three months of 2016, as the drop in oil prices crimped domestic production, according to data from the agency, an arm of the Energy Department.

Despite the national decrease, residents along the Columbia River Gorge say they have seen an increase in the number of oil trains rolling through the area.

“Individuals in the towns of the Columbia Gorge have been very concerned about this since the vast increase in oil traffic,” Sen. Jeff Merkley (D-Ore.) told Bloomberg BNA. “People have pictured them as rolling explosion hazards and the fact is this crash confirmed all the worst fears. So we have to be much more aggressive in preventing this from happening again.”

Derailments Involving Crude and other Hazardous Materials

Impact on Terminal?

“We are exploring legislation,” Merkley added.

The number of oil trains rolling through the area would almost certainly increase further if a number of pending oil by rail terminals, including one proposed by Tesoro Corp. for the Port of Vancouver, Wash., are approved.

The Tesoro facility, a joint venture with Savage Cos., would have the capacity to upload 360,000 barrels per day for shipment to refineries on the West Coast and possibly overseas.

The state's Energy Facility Site Evaluation Council is expected to make a decision on whether Washington Gov. Jay Inslee (D) approves the project sometime this year. The accident is unlikely to help Tesoro's case, said Dan Serres, conservation director for Columbia River Keeper, an environmental group focused on protecting the Columbia River.

“I think having an oil train derail spill and burn is exactly what people have been talking about,” Serres told Bloomberg BNA. “We think the Tesoro project is a dead man walking.”

Tina Barbee, a spokeswoman for Tesoro subsidiary Vancouver Energy, said they remain committed to the proposed terminal.

“Tesoro and Savage have decades of combined experience operating marine and rail crude oil facilities safely, and the facts support our ability to build and operate a terminal at the Port of Vancouver USA in a safe and environmentally responsible manner,” Barbee said in an e-mail to Bloomberg BNA. “We recognize the serious nature of the derailment near Mosier, and will be examining the results of the investigation, once complete, to determine any lessons learned that can be applied to enhance the safety of transporting crude oil by rail.”

Congressional Action Said Unlikely

Analysts, such as Fred Millar, an independent rail safety consultant, said the accident in Mosier is unlikely to spur a gridlocked Congress to act.

“I don’t think it's enough. What we’ve seen is we’ve had a couple of dozen major accidents and fireballs all over the continent and the legislation that has come out has been very marginal improvements,” Millar said in an interview. “We don’t have a pile of bodies in Mosier. We have a damn lucky close call.”

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To contact the editor responsible for this story: Larry Pearl at