[ROCKMAN]

Pik - “I reject the notion that if Keystone, Kinder Morgan and Northern Gateway are not built we will just simply ship by rail.” You’re a tad late worrying about that…the trains are rolling now. But it’s also good to remember that only about 2% of Canadian oil production currently moves by rail. Pipelines have always, and will always, dominate. The rail surge now is just a small sideshow being blown all out of proportions by both sides IMHO.

“In other words they are willing to place their profits above the health and safety of the citizens of this country”. And apparently for your convenience you’ve been accepting the transportation via rail of much more dangerous materials as noted below. As far as rejecting pipelines very few have ever been rejected. The hot air being blown by both sides over the Keystone border crossing permit is truly childish. It’s projected that by the end of 2013 there will be more Canadian oil shipped to the US than ever before in history. And that’s without that permit approved. They are already shipping 2.3 million bopd now. And it will be done by truck and rail but predominantly by the EXISTING pipelines that already cross the border. And 4 million bopd by 2020 is questionable? There’s at least another 2 million bopd capacity for pipelines that have already been approved.

The only real issue of rail vs. pipeline is getting to the Canadian west coast so they can ship overseas. If that pipeline is never approved I doubt it will change the plan to export to Asia…just cost a little more. With the new Keystone pipeline about to start flowing and others that require no fed govt approval much of that Canadian oil can be shipped to Texas, loaded out on the big tankers that will be able to transit the newly redesigned Panama Canal and still make it to China et al. The US govt can restrict the export of oil produced in the US. It cannot restrict the export of foreign sourced oil from US ports.

[Pik]

The issue here is not about conventional crude it's about fracked crude and bitumen diluted with condensate. It was fracked crude that was involved in the Lac Magantic tragedy. Bitumen by itself is such a poor hydrocarbon you couldn't light it with a blow torch, however condensate is extremely dangerous and is classified as a highly toxic substance by the federal government containing such things as pentane, hexane, heptane, octane, as well as more complex impurities, including benzene, toluene, xylene, ethylbenzene and hydrogen sulfide. It is highly flamable and under the right conditions explosive.

[Graeme]

Ottawa to designate crude oil as highly dangerous

The federal government will, for the first time, designate crude oil a highly dangerous substance and introduce tougher safety and testing measures for shipping oil by rail, Transport Minister Lisa Raitt has told The Globe and Mail.

The fundamental shift, in response to mounting concerns about crude safety, comes after a Globe investigation detailed how the oil that exploded in Lac-Mégantic, Que., last summer was far more dangerous than regulators and shippers considered. The investigation found that numerous warning signs about the volatility, corrosiveness and content of the crude were ignored before the disaster.

Until now, the government considered crude flammable, but not highly explosive. However, massive fireballs erupted in Lac-Mégantic on July 6 after a train carrying 72 tankers of crude oil derailed, killing 47 people and levelling much of the downtown. It is the worst railway disaster in Canadian history.

Ms. Raitt said on Thursday there is a clear need for higher safety standards to deal with the massive growth in oil being shipped by rail through cities and towns. Transport Canada also plans to pursue oil shippers who are not properly testing crude before shipping it in light of the Globe investigation, which found shippers were loading oil on trains without knowing whether it was potentially dangerous, despite an order from Ottawa to scrutinize shipments.

theglobeandmail

[yellowcanoe]

Rockman has noted that oil produced in the US cannot be exported so for oil from North Dakota to be shipped to Canada the oil must be partly cracked so it can be classified as a refined product. I would surmise that this process results in a more volatile product that would have contributed to the magnitude of the disaster at Lac Megantic. When the disaster first hit the news I was confused as to how raw petroleum could produce explosions and massive fires so quickly after the derailment. Some of the early news reports suggested there may have been cars filled with propane on a siding where the train derailed but that appears not to have been the case.

[ROCKMAN]

Canoe - I haven't confirmed it but I just read that the feds are allowing more export exceptions. I don't know exactly what happened in the Canadian accident. While oil isn't generally explosive but once it's ignited it burns really hot. One possibility is that some unruptured tankers might have heated up to explosive pressure levels.

The odd thing about the story is that all across the US and Canada there are many times more tankers of much more volatile, explosive, corrosive and toxic the crude oil. Consider a very strange accident in S Texas about 40 years ago. A propane delivery truck was rear ended, exploded and shot off like a rocket through a trailer park killing many. And about 10 years ago some locals in Houston got panicky when they found out some tanker trucks carrying napalm was moving thru the area. But napalm is designed to be less volatile and explosive than gasoline. Makes a much better (and vicious) weapon that way. IOW the many tens of thousands of tank trucks delivering gasoline to the stations in Houston every year were much more dangerous. But "napalm" is a much scarier word than "gasoline". Now, because of the accident many Canadians are more scared of trains hauling oil then they are of gasoline hauls.

[yellowcanoe]

Canoe - I haven't confirmed it but I just read that the feds are allowing more export exceptions. I don't know exactly what happened in the Canadian accident. While oil isn't generally explosive but once it's ignited it burns really hot. One possibility is that some unruptured tankers might have heated up to explosive pressure levels.

It takes time for an unruptured tanker to heat up to the point that you get a BLEVE explosion. I'd guess there was some highly volatile liquid at the top of each tank that could be quickly mixed with air when the tank ruptured which would then cause an explosion when ignited. It will be interesting to see what the Transportation Safety Board report says about the accident.

The odd thing about the story is that all across the US and Canada there are many times more tankers of much more volatile, explosive, corrosive and toxic the crude oil. Consider a very strange accident in S Texas about 40 years ago. A propane delivery truck was rear ended, exploded and shot off like a rocket through a trailer park killing many. And about 10 years ago some locals in Houston got panicky when they found out some tanker trucks carrying napalm was moving thru the area. But napalm is designed to be less volatile and explosive than gasoline. Makes a much better (and vicious) weapon that way. IOW the many tens of thousands of tank trucks delivering gasoline to the stations in Houston every year were much more dangerous. But "napalm" is a much scarier word than "gasoline". Now, because of the accident many Canadians are more scared of trains hauling oil then they are of gasoline hauls.

Yes, most people don't understand (or choose not to understand) the concept of relative risk and you are quite correct in pointing out that other types of materials carried on trains are more dangerous than oil. The Mississauga trail derailment in 1979 resulted in the evacuation of 200,000 people as one of the ruptured cars contained chlorine which could have resulted in a poisonous vapour being spread over a wide area. However, I can't fault people for being concerned about oil trains. The fire and explosions that occured after the derailment in Lac Megantic happened so quickly that roughly 50 people did not have an opportunity to evacuate the area. It wasn't that the buildings were hit by the derailed tank cars, but that the buildings were engulfed in fire so quickly that people didn't have a chance to escape.

[Graeme]

Is Bakken oil safe enough for the GTA?

The crude oil on that train came from North Dakota, where it was pulled from the shale of the Bakken formation, which stretches from western North Dakota into southern Saskatchewan and eastern Montana.
It’s the same oil Enbridge plans to pump through Line 9, a pipeline that cuts through the GTA if federal regulators approve plans to reverse the flow in the 38-year-old pipeline to supply Quebec refineries with cheaper products from western Canada and the Bakken region.


Producers use a toxic soup of chemicals, such as hydrochloric acid, a highly corrosive component that critics fear could eat away at pipelines and tank cars if not fully removed from the oil.

And Bakken crude can contain high levels of hydrogen sulfide, a toxic, corrosive chemical that’s extremely flammable.

Earlier this year, Enbridge got into a spat with shippers when it asked federal regulators for permission to reject crude oil with hydrogen sulfide levels higher than 5 parts-per-million — after tests revealed a batch of crude bound for a pipeline at its Berthold, N.D., facility had levels of 1,200 ppm.

Human exposure to hydrogen sulfide at 50 ppm or higher can cause death. The batch Enbridge successfully rejected contained 24 times the lethal level.
But it was Enbridge that pushed for that 5 ppm limit, which was protested by oil producers. No regulations require it. Some companies don’t have such limits.

thestar

[ROCKMAN]

Yellow canoe - Yes...relative risk. But beyond that there's the risk vs. benefit aspect. Between 2001 and 2009 about 150 children were killed in school bus accidents...3X as many killed in the derailment. Both tragic loses. But no one is talking about banning those buses because of the benefit. My daughter rides the bus so I benefit. Moving oil via rail in Canada not only doesn't benefit me but those imports to the US put downward price pressure on the oil I sell. So I'm for banning all oil via rail. But I'm pretty sure a lot of the citizens in Alberta and N Dakota are OK with it. IOW there's no absolute good or bad IMHO...it's all relative.

Speaking of concerns for persona safety: about as many folks are killed by lightning every year in N. America as were killed in that train accident. How many headlines have you seen highlighting that fact compared to the dangers of oil via rail? As they say in the MSM: If it bleeds it leads. Especially if it's oil related.

[ROCKMAN]

Almost 1 million bbls/day of Bakken oil rolling to the west coast:

Reuters - Independent refiner Tesoro Corp sees rail unloading capacity all along the U.S. West Coast for North Dakota Bakken crude oil growing to nearly 1 million barrels per day through 2015. The projected jump to 910,000 bpd from the industry's current unloading capacity of 218,000 bpd - an increase of more than 300 percent - includes Tesoro's $100 million joint-venture railport project in Washington state. Tesoro's rail-to-barge project is the largest of the offloading projects announced so far. Tesoro is seeking a state permit that would allow handling of up to 380,000 barrels per day of crude. Other refiners and logistics companies are building or seeking to build smaller projects to bring in cheaper crude via rail as well. Loading capacity is keeping pace with production growth. The growth will accommodate increasing efforts by West Coast refiners to tap inland U.S. and Canadian heavy crudes via rail - cheaper alternatives to imports and Alaskan crude - as no major pipelines move crude to that largely isolated market.

[ROCKMAN]

What is Hamm really saying? IMHO what he really means is now that the southern leg of Keystone XL, with a capacity to move 700,000 bbls of oil sands production from OK to Texas refineries, is currently openning he doesn’t want to compete with that oil. So he’ll ship his Bakken production elsewhere. Perhaps, as the previous post points out, shifting Bakken oil via rail to the more lucrative west coast market. It isn’t because KXL won’t be shipping Canadian oil but because it on the verge of moving large volumes into the Gulf Coast market place.

Reuters - Continental Resources now says the controversial pipeline is no longer needed. Continental has signed on to ship some 35,000 barrels of its own oil from the Bakken field of North Dakota on the 1,179-mile, $5.4-billion Keystone XL line. But construction of the pipeline has been delayed for years Continental has since turned to railroads to get its crude to oil refineries.

Harold Hamm told Reuters that his company and the U.S. oil industry in general are no longer counting on Keystone XL. Oil companies have been strong advocates of Keystone in order to help alleviate oil supply bottlenecks, but Hamm's remarks raise the question of whether regulatory delays have eroded the industry's enthusiasm for the line, which has faced aggressive resistance from environmentalists.

When asked whether Keystone XL is still needed, Hamm said "not for our Bakken crude.” Rail has been a big factor and proven to be a very effective way of getting Continental's crude to market. Continental now ships 90 percent of its crude oil by railcar. Rail transport can be more expensive, but it allows shippers more flexibility on where the crude is shipped.

Keystone XL's developer, Canadian pipeline giant TransCanada, said the line has broad support, and there is a waiting list of customers interested in securing capacity on the line.

[dinopello]

Train in North Dakota with crude derails, explodes

Initial reports indicated that another freight then plowed into the derailment, but the sheriff's office said about 5 p.m. that it remained unclear which train was hit.

"At this time we're dealing with the fire, and we can't even get close enough to determine that," Sgt. Tara Morris told Inforum.

Residents within a two-mile radius were warned to stay inside. One resident about a half-mile from the derailment told KVLY-TV she could see large flames. Smoke could be seen 15 miles away.

[ROCKMAN]

Dino - Had a response to a thread about the rail accident but that thread just disappeared so I'll piggyback on you:

The recent rail accident in N Dakota "...make approval of Keystone XL more likely.'' And once again I'll point out the Keystone XL pipeline has not only been approved but much of it has already been built. The southern leg of KXL is currently being filled with 3 million bbls of oil sands production and will begin deliveries to Texas refineries on 22 January 2014. This segment will have a 600,000 bopd capacity and will receive oil from the Keystone Pipeline that has been moving oil sands production across the border for years. The Keystone Pipeline is a different system than the Keystone XL Pipeline system. The only section of KXL that requires POTUS approval is just those few miles where it actually crosses the border.

As far as permitting the border crossing section of the KXL Pipeline as a safety consideration because of the N Dakota rail accident if I'm reading the story correctly it was not hauling oil sands production and no aspect of the KXL Pipeline, existing now or in the future, will have any impact on future oil transport alone that rail system. But I do expect the POTUS to approve the border crossing section when it is politically safer to so. Since the entire KXL isn't scheduled to be completed there hasn't been a need to build that section any sooner. Without that border crossing section more oil sands production has been exported to the US then ever before in history. And not that oil sands producers can sell directly to Texas refineries it is anticipated they will be getting a better price which will make further development of the play more attractive.

[Graeme]

But I do expect the POTUS to approve the border crossing section when it is politically safer to so. Since the entire KXL isn't scheduled to be completed there hasn't been a need to build that section any sooner.

I think your prediction is a tad premature because approval is not guaranteed. If he does approve keystone XL, then the majority of his constituency will always regard him as a lame-duck president. I don't think he can live with that.

Pipelines can break, leak and explode just likes trains. Both avenues need to be stopped.

Happy New Year.

[Timo]

I'm with you, Graeme.

[ROCKMAN]

"...because approval is not guaranteed." I didn't say it was guaranteed, did I? Straw man arguments don't improve your position. What I said was that I expect the POTUS to approve the permit when it's politically convenient for him to do so. My OPINION hasn't changed. As far as anyone considering the POTUS a lame duck that's exactly what he is. As far as "... he can't live with that" he didn't appear to have a problem living with his public support of the southern leg of the Keystone XL Pipeline. This major section of the pipeline (that the POTUS supported) with a capacity to move 600,000 bbls per day of oil sands production will start next month directly moving oil from the Canadian fields to the Texas refineries. You're a big supporter of the POTUS: how does his ordering all his departments to expedite the completion of this major leg of KXL sit with you? The fact that you continually refuse to acknowledge what has happened with the pipeline seems to indicate you can't live with it.

[Graeme]

I like Obama but some of his policies are now destroying our civilization. I have to hope that the delay to deciding to approve Keystone XL is a tacit acknowledgment of the administation's foolish policies. He is starting to make amends with his global warming action plan. I expect him to disapprove the KXL because if he approves then he will have a lot of very angry former supporters who might just take matters into their own hands in a violent way (another American revolution?). That situation may be even more difficult to deal with than if he disapproves. At least most of your infrastructure will remain intact. This decision may well be the trigger to change in the right direction (the beginning of the end of ff) whatever he decides. Meanwhile the world holds it's collective breath as atmospheric oxygen slowly declines. We are anxious to hear his decision because it could lead to fewer or more pipeline and train "accidents".

[rockdoc123]

I expect him to disapprove the KXL because if he approves then he will have a lot of very angry former supporters who might just take matters into their own hands in a violent way (another American revolution?).

good God man, give your head a shake. The vast majority of his vocal supporters will simply move onto their next movie or other cause celebre.

[Lore]

I like Obama but some of his policies are now destroying our civilization. I have to hope that the delay to deciding to approve Keystone XL is a tacit acknowledgment of the administation's foolish policies. He is starting to make amends with his global warming action plan. I expect him to disapprove the KXL because if he approves then he will have a lot of very angry former supporters who might just take matters into their own hands in a violent way (another American revolution?). That situation may be even more difficult to deal with than if he disapproves. At least most of your infrastructure will remain intact. This decision may well be the trigger to change in the right direction (the beginning of the end of ff) whatever he decides. Meanwhile the world holds it's collective breath as atmospheric oxygen slowly declines. We are anxious to hear his decision because it could lead to fewer or more pipeline and train "accidents".

It should be pretty obvious by now that Obama will be approving KXL. The administration is only waiting to use the call as some bargaining chip to a grand future agreement. If the President was really following his convictions he would have easily made the decision to disapprove it a long time ago. The reason he hasn't is to hold onto his base of support and wait till the trade-off is large enough to snuff the outcry.

[Graeme]

I don't think so. Let's recall what the Pentagon and NSA have been preparing for since 2005.

But why have Western security agencies developed such an unprecedented capacity to spy on their own domestic populations? Since the 2008 economic crash, security agencies have increasingly spied on political activists, especially environmental groups, on behalf of corporate interests. This activity is linked to the last decade of US defence planning, which has been increasingly concerned by the risk of civil unrest at home triggered by catastrophic events linked to climate change, energy shocks or economic crisis - or all three.


That year [2006], the Pentagon had begun developing a 20,000 strong troop force who would be on-hand to respond to "domestic catastrophes" and civil unrest - the programme was reportedly based on a 2005 homeland security strategy which emphasised "preparing for multiple, simultaneous mass casualty incidents."


The Pentagon knows that environmental, economic and other crises could provoke widespread public anger toward government and corporations in coming years. The revelations on the NSA's global surveillance programmes are just the latest indication that as business as usual creates instability at home and abroad, and as disillusionment with the status quo escalates, Western publics are being increasingly viewed as potential enemies that must be policed by the state.

theguardian

[Graeme]

Bakken Crude More Dangerous to Ship Than Other Oil: U.S.

Crude oil produced in North America’s booming Bakken region may be more flammable and therefore more dangerous to ship by rail than crude from other areas, a U.S. regulator said after studying the question for four months.

The Pipeline and Hazardous Materials Safety Administration announced its preliminary conclusion today, three days after a BNSF Railway Co. train carrying oil caught fire after a collision in Casselton, North Dakota.

The North Dakota accident is the fourth major North American derailment in six months by trains transporting crude. Record volumes of oil are moving by rail as production from North Dakota and Texas pushes U.S. output to the most since 1988 and pipeline capacity has failed to keep up.

The regulator “is reinforcing the requirement to properly test, characterize, classify, and where appropriate sufficiently degasify hazardous materials prior to and during transportation,” according to a safety alert posted on its website today.

The agency’s findings may expedite the rail industry’s push for stronger tank cars for moving crude and other hazardous materials. It strengthens calls for the petroleum industry to accurately label tank-car contents and test shipments to make sure they don’t contain gases from the lighter oil produced in the shale rock in North Dakota.

bloomberg