Changes to US rail rules

BULK BARGAIN

RAIL • PHMSA HAS RECENTLY ISSUED TWO RULEMAKING ANNOUNCEMENTS THAT WILL BE OF VALUE TO THOSE SHIPPING OIL AND LNG IN BULK BY RAIL WITHIN THE US

THE US PIPELINE and Hazardous Materials Safety Administration (PHMSA) has been rather quiet this year in terms of new rulemakings, and with an election in the offing in November there is little chance of any significant new activity in the near future. It has, however, issued two regulatory notices over the past few months of interest to those involved in the movement of flammable liquids in bulk by rail, both of which should benefit industry.

The first of these was actually the withdrawal of a proposed rulemaking. PHMSA had, in concert with its colleagues in Transport Canada, started to look at the safety issues involved in the transport of crude oil derived from oil shales and shale oil, in the wake of the fatal accident in Lac-Mégantic, Quebec in July 2013 and other incidents involving the transport of crude oil from the Bakken fields, which lie largely in Montana and North Dakota but also across the border in Canada. One concern was that the entrained natural gas in the oil could lead to an increase in vapour pressure and make the oil more susceptible to explosion in the event of an accident.

On 18 January 2017, PHMSA issued an advanced notice of proposed rulemaking (ANPRM) seeking comments on its proposal to place a limit on vapour pressure for unrefined petroleum crude oil and other Class 3 flammable liquids during transport. Many in industry saw this as an example of ‘regulatory creep’: the problem the rulemaking sought to address related to the transport of crude oil in rail tank cars, whereas the rulemaking as proposed would have covered all Class 3 material transported by any mode in both bulk and packaged form.

TEST THE THEORY In the face of these and other comments, the US Department of Transportation (DOT) and Transport Canada engaged Sandia National Laboratories to conduct a study to better understand the risks associated with the transport of tight oil by rail. Part of that study involved an analysis of physical, chemical and combustion characteristics of a range of North American crude oils, with differing composition and vapour pressure.

Sandia’s study concluded that, despite the wide variation in vapour pressure, all the crude oils tested had very similar calculated thermal hazard distances with respect to pool fire and fireball combustion. Furthermore, they were also found to have thermal hazard parameters consistent with the known thermal parameters of other alkane-based hydrocarbon liquids, some of which had a higher vapour pressure than those shown by the Bakken crude.

Based on these data points, the Sandia Study concluded that vapour pressure is not

PHMSA IS KEEN TO BALANCE SAFETY WITH

a statistically significant factor in affecting the thermal hazard posed by pool fire and fireball events that might occur during crude oil train derailment scenarios. Therefore, placing an upper limit on the vapour pressure of crude oils transported by rail would have no impact on the severity of pool fire or fireball scenarios.

In light of this unequivocal conclusion by Sandia, on 20 May 2020 PHMSA withdrew the ANPRM. It also noted that its decision likely pre-empts non-Federal laws on the same issue. Both North Dakota and Washington already have laws in place setting vapour pressure limits for crude oil and a number of others have been considering similar rules. PHMSA invites anyone affected by those rules to apply for a determination that the law is pre-empted. LNG BY RAIL The second rulemaking relates to the transport of LNG in bulk in rail tank cars. PHMSA issued a final rule on 24 July this year under docket HM-264, with an effective date of 24 August.

In the final rule, PHMSA authorises the transport of LNG by rail in DOT-113C120W tank cars, which it says have an established safety record in cryogenic service, enhanced with an outer tank that is thicker and has greater puncture resistance to provide additional crashworthiness. The rule also calls for operational controls in the form of enhanced braking requirements, remote monitoring and route analysis.

PHMSA notes that it regards the transport of LNG (‘Methane, refrigerated liquid’ according to the Hazardous Materials Regulations) by rail in bulk as a safe alternative to road transport. Until the publication of the final rule, this was only permitted on an ad hoc basis via special permits or approval by the Federal Railroad Administration (FRA). Recent expansion in US natural gas production has made it necessary to formulate a permanent provision.

The rule also satisfies a directive in Executive Order 13868, issued on 19 April 2019, to “treat LNG the same as other cryogenic liquids and permit LNG to be transported in approved rail tank cars”.

Further detail on the specific technical requirements for tank cars for LNG service can be found in the final rule, published in the Federal Register and available at www.federalregister.gov/ documents/2020/07/24/2020-13604/hazardousmaterials-liquefied-natural-gas-by-rail.