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Dalrymple, Secretary Foxx Discuss Ongoing Work to Improve Rail and Pipeline Safety

BISMARCK, N.D. – Gov. Jack Dalrymple today spoke again with U.S. Transportation Secretary Anthony Foxx to update the secretary on the state’s ongoing work to enhance rail safety and pipeline integrity in North Dakota.  Dalrymple also urged Foxx to adopt new federal tank car standards as soon as possible, and to enhance rail and pipeline safety programs administered by the U.S. Department of Transportation (USDOT).

“Secretary Foxx and I agree that there is no single solution to improving the safety of rail transportation,” Dalrymple said. “We have taken significant steps in North Dakota to improve rail safety, including the adoption of new oil conditioning standards to reduce the vapor pressure of crude oil before shipment.  I also shared with Secretary Foxx the good progress being made on new oil pipelines and on other state initiatives for rail safety and pipeline integrity.”

Pipelines Critical to Safe Crude Oil Transportation

Dalrymple stressed to Foxx the importance of developing greater interstate pipeline capacity for the shipment of crude oil, and he briefed the secretary on three important projects currently underway:

  • Expected to be completed in the first quarter of 2017, Enbridge’s Sandpiper Pipeline will have the capacity to transport 225,000 barrels per day (bpd) of crude oil from western North Dakota to an existing terminal in Superior, Wis. From there, the oil can be transported to refineries in the Midwest and along the East Coast.
  • Energy Transfer Partners is developing the Dakota Access Pipeline, which will be capable of transporting 450,000 bpd of crude oil to a terminal in Illinois that also serves Gulf Coast markets. The Dakota Access Pipeline is expected to be completed in late 2016.
  • TransCanada’s planned Upland Pipeline will have the capacity to ship 220,000 bpd of Bakken crude oil to East Coast refineries.  TransCanada expects to complete the pipeline project in 2018.

With a total capacity to ship 895,000 bpd, these three pipeline projects would significantly reduce daily rail shipments of crude oil from the Bakken Shale Formation. Currently, about 600,000 barrels of Bakken crude oil is shipped daily by rail.  Dalrymple emphasized that pipelines offer the safest mode of crude oil transportation, and said government officials at all levels should make pipeline development a top priority.

Dalrymple Presses for New Tank Car Standards

While speaking with Foxx today, Dalrymple urged the secretary to issue as soon as possible new standards for next-generation tank cars and new regulations for phasing out or retrofitting older tank cars.

New standards for tank cars should prioritize the installation of high-capacity relief valves to enhance the release of vapor pressures when excessive heat is present.  Legacy tank cars that can be retrofitted should also be equipped with the improved relief valves, Dalrymple said.

The USDOT originally planned to issue new tank car standards and regulations for the phase out of older tank cars in March. The new standards and phase-out requirements are now expected to be issued in May.

Proposed State-Run Rail Safety and Pipeline Integrity Programs

Dalrymple and the Public Service Commission have proposed establishing a state-run railroad safety program as well as a pipeline integrity program that would complement federal oversight in North Dakota.  

The proposal calls for about $1.4 million in state funding for three positions to enhance railroad track inspections in North Dakota and another three positions for stepped-up inspections of pipelines that transport crude oil and other liquids to market.

State-Mandated Oil Conditioning

On Dec. 9, the Industrial Commission unanimously approved an order that requires all oil producers in North Dakota to install and utilize oil-conditioning equipment to significantly reduce the volatility of Bakken crude oil.  The oil conditioning order includes strict parameters for temperatures and pressures under which the equipment must operate to ensure that light hydrocarbons are removed before oil is shipped to market. The order brings every barrel of North Dakota crude oil within a set standard, requiring oil be stabilized so that its vapor pressure is no greater than 13.7 pounds per square inch (psi) before shipment.

North Dakota’s vapor pressure standard for oil is more stringent than the national standard developed by the American National Standards Institute and the American Petroleum Institute, which established that crude oil is stable at a vapor pressure of 14.7 psi.  

The Industrial Commission’s order requires that oil producers install and utilize conditioning equipment by April 1. The Industrial Commission approved the oil-condition order after holding a public hearing and providing for an extended public comment period.

Dalrymple also urged Foxx to provide funding for the second phase of a U.S. Department of Energy study on oil volatility.




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