Friday, July 12, 2013

The Case for Pipeline Criminal Negligence

Failing To Build Pipelines Is Criminal Negligence

By Chriss Street

The Canadian Royal Mounties now believe that the mile-long runaway oil train that killed 15 and left 35 people missing in a small Quebec town may have been an act of criminal negligence for failing to set the brakes properly.  .

But the real criminal negligence is that oil from booming fracking operations in North Dakota must be shipped by trains over a thousand mile to refiners in Nova Scotia, because regulators fought building American pipelines and refineries to protect and subsidize railroads, such as Burlington Northern Railway Company that controls half the business.  Given the loss of life, the Obama Administration and Congress will soon announce approval of a number of new pipelines, including the Keystone XL

Every day, an average of ten trains with up to 100 tank-cars leave North Dakota carrying 3.35 million gallons of raw crude oil to journey over a thousand miles to refineries in Nova Scotia and Texas.  Railroads carry 75% of North Dakota oil and are the prime reason oil hauled by tank cars in the U.S. rose over the last three years by 2,000% to a total of 6.5 billion gallons.  Railroads claimed to average only thirteen spills per year over the last ten years, but 60% oil shipments by rail was in the last two years.

Railroads are designed to go to where people are, whereas pipelines go to refineries that are specifically located a safe distance way from populated areas. Only good fortune prevented Lac-Megantic level disaster from occurring sooner.

Every month since April there has been a serious Canadian oil train derailment.  Last month, four Canadian Pacific rail cars carrying flammable petrochemicals used to dilute oil derailed on a flood-damaged bridge spanning Calgary’s Bow River, according to the Calgary Herald.  In another incident involving Canadian Pacific, five tankers containing oil derailed in rural Saskatchewan in May, spilling 575 barrels of crude, the Toronto Sun reported.  A month earlier, 22 Canadian Pacific rail cars jumped the tracks near White River, Ontario. Two of the cars leaked about almost 17,000 gallons of crude oil, The Toronto Globe and Mail in Toronto reported.  Canadian Pacific was also involved in a March U.S. spill where 14 cars on a mile-long, 94-car train derailed about 150 miles northwest of Minneapolis, spilling about 30,000 gallons of crude.
Canadian Prime Minister Stephen Harper described the aftermath of the Lac-Megantic disaster as a “war zone.  Air brakes holding it in place likely failed allowing the train, which normally creeps downhill at 15 miles per hour, to accelerate to 63 miles an hour and vaporize the town when it crashed and exploded.

The fallout from the derailment is already having a negative impact on the near-term growth of moving petroleum by freight trains, which was on trend to double this year from 2012.  Moody’s credit rating service warned: “The Quebec derailment — likely North America’s worst rail accident since 1918 — will inevitably lead to increased US and Canadian government scrutiny and permitting delays, along with higher costs for shippers,” the credit rating agency said in a note Wednesday.  Moody’s revised its ratings to “credit negative” for North American railways, which have relied on the boon in moving crude by rail to offset declines in coal shipments, it added.
America in 1970 had 315 refineries sprinkled across the nation and the U.S. imported 67 million gallons of crude oil per day, but by 2006 environmental restrictions had shrunk America’s number of refineries to 105 and we were importing 449 million gallons per day.  In percentage terms of U.S. supply, imports grew from 20% to 65%.  In 2006, almost a third of U.S. total supply of oil was imported from the unstable Persian Gulf.

Since 2007, the drilling process known as hydraulic fracking has rendered commercially profitable petroleum deposits that were historically too costly to exploit.  North Dakota production has grown from about 8.25 million gallons a day to 43.45 million gallons today.  Wayde Schafer, a spokesman for the Sierra Club that had been predicting U.S. oil and gas production had peaked in the 1980s and was in terminal decline: “The oil development has happened so rapidly, it’s ahead of the infrastructure to deal with it.”
Pipelines are the safest and most cost-effective transport crude oil.  Legislative veto of projects like the Keystone XL pipeline pushed oil onto to the more risky rails.  Rapidly expanding shale oil production is making American “energy independence” feasible.  I believe Congress and the Administration now know they are criminally negligent if they do not ensure public safety by green-lighting $5 trillion in new pipelines and refineries.

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