US fines operators for rail violations

US regulators have slapped three Bakken shale operators with notices of “probable violations” for improperly classifying crude destined for rail transport, www.upstreamonline.com reported on Wednesday.

The US Transportation’s Department’s Pipeline & Hazardous Materials Safety Administration  has proposed fines totalling $93,000 against independent producers Hess, Whiting Oil & Gas and Marathon Oil for not correctly labelling rail-bound crude oil. None of the three companies had immediate comments.

The fines come as scrutiny intensifies on companies who ship crude by rail in North America in the wake of several violent derailments involving crude trains.

A train wreck in Lac-Megantic, Quebec, last July killed 47 people and levelled a town. A number of other oil trains have crashed since then, sparking explosions and major oil spills, in places like Alabama, North Dakota and New Brunswick, Canada.

Crude oil, if properly contained, should not explode in the event of an accident like those seen in North America over the past several months, according to experts.

Shippers of hazardous materials such as oil are required to classify their loads using nine hazard classes, the PHMSA said.

“Proper classification will ensure that the material is placed in the proper package and that the risk is accurately communicated to emergency responders,” it said.

“Shipping crude oil – or any hazardous material – without proper testing and classification could result in material being shipped in containers that are not designed to safely store it, or could lead first responders to follow the wrong protocol when responding to a spill.”

Since shortly after the Quebec disaster, PHMSA has been investigating the transportation of oil produced in the Bakken shale, where pipeline infrastructure has not kept up with booming production and rail shipments have soared.

The agency found that 11 of the 18 samples taken from cargo tanks delivering crude oil to the rail loading facilities “were not assigned to the correct packing group”.

Based on the findings, PHMSA has expanded the scope of its investigation to include testing for other factors that affect proper classification, including Reid Vapor Pressure, corrosivity and the composition and concentration of gases in the material.

“Transportation has an important role to play in helping meet our country’s energy needs, thanks to the increased production of crude oil, but our top priority is ensuring that it is transported safely,” said transportation secretary Anthony Foxx.

“The fines we are proposing today should send a message to everyone involved in the shipment of crude oil: You must test and classify this material properly if you want to use our transportation system to ship it.”