Industry Group Study Says Bakken Crude Poses No Different Risks Than Other Crude Shipped By Rail


As rail shipments of crude oil moving out of North Dakota’s Bakken formation have risen in recent years, so have derailments of trains carrying crude oil throughout the United States and Canada.  One facet of the debate over how to improve the safety of crude by rail shipments concerns the volatility of Bakken crude compared to other crude oil moved by rail.   In January the Pipeline and Hazardous Materials Safety Administration (PHMSA) sent a letter to the American Fuel & Petrochemical Manufacturers (AFPM) requesting information on the tests and methods used to analyze and classify crude oil prior to shipment.   

In response, on May 15 AFPM released a report on the characteristics of Bakken Crude Oil.  The report was based on a survey of 17 AFPM members and included over 1400 samples of Bakken crude.  AFPM asserts that its findings reveal that that “Bakken crude is comparable to other light crudes and does not pose risks that are significantly different than other crudes or flammable liquids authorized for rail transport.” 

In its press release accompanying the release of the report, AFPM stated that the study demonstrates that “there is no need to create a new DOT classification for [Bakken] crude oil transportation.” 

The Wall Street Journal reported that AFPM’s President, Charles Drevna, said “[t]he debate should now focus on the remaining issues—track integrity and maintenance and training for rail operators and responders.”  Mr. Drevna’s comment hits on the controversy about how best to address the safety concerns over crude by rail shipments.  As noted by Bloomberg Business Week in its report of the AFPM study, “[w]hile the railroads have urged the shippers to lease stronger tank cars, the oil and refining companies claim the bigger problem is that railroads need to do a better job at maintaining tracks.”

In a story about the study, Railway Age Magazine noted that “as the anniversary of the Lac-Mégantic catastrophe approaches, what had seemed to be a public consensus that the ultra-light Bakken crude is inherently too volatile for DOT-111 carriage is fracturing into open dispute between oil shippers and rail carriers.”

For its part, PHMSA Administrator Cynthia Quarterman sent AFPM a letter asking for more detail on sample selection and methods used for the study. 


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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