USDOT Proposes New Rules for Rail Transport of Fossil Fuels

by Stoel Rives LLP
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On Wednesday, July 23, 2014 the Pipeline and Hazardous Materials Safety Administration (“Administration”), an agency within the U.S. Department of Transportation (“USDOT”), issued a Notice of Proposed Rulemaking (“NOPR”) for rail transport of crude oil and ethanol.  The NOPR, titled “Enhanced Tank Car and Operational Controls for High-Hazard Flammable Trains,” is available online, but has not yet been published in the Federal Register. 

There are three main provisions of the NOPR: “(1) new operational requirements for certain trains transporting a large volume of Class 3 flammable liquids; (2) improvements in tank car schedules; [and] (3) revision of the general requirements for offerors to ensure proper classification and characterization of mined gases and liquids.”  (NOPR, at p. 1.)  Notably, the USDOT proposes to phase out the use of older USDOT tank cars for the shipment of certain liquids within two years, unless the tank cars are retrofitted to comply with new tank car design standards.  (See USDOT, U.S. DOT Announces Comprehensive Proposed Rulemaking for the Safe Transportation of Crude Oil, Flammable Materials.)  This rule would include gradual prohibition on transport of most Bakken crude oil.

The NOPR follows two Emergency Orders issued by the USDOT.  The original Emergency Order was issued on February 25, 2014 and the Amended Emergency Order was issued on March 6, 2014.  The Emergency Orders and the NOPR are primarily in reaction to crude oil rail accidents occurring in North Dakota, Alabama, Virginia, and Quebec within the past year.  The USDOT reports, “[t]he growing reliance on trains to transport large volumes of flammable liquids poses a significant risk to life, property, and the environment.”  (NOPR, at p. 1.)  Derailments have also prompted state governments to begin contemplating expanded regulation of rail transport, as reported in our post here.

Public comment will be accepted for 60 days following the publication of the NOPR in the Federal Register.  When submitting public comment, USDOT instructs the author to identify the agency name and docket number: PHMSA-2012-0082 (HM-251).  (See NOPR, at p. 2.)  Further information on solicitation of public comment can be found on USDOT’s website.

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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