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February 13, 2016

Much-Anticipated Rail Shipping Rule for Oil Is Unveiled

Ending months of waiting by industry groups and local officials, the Department of Transportation on Wednesday issued its proposed rulemaking on rail shipments of flammable materials, including crude oil from North Dakota’s Bakken shale.

Among other steps, the department would phase out within two years older tank cars for the shipment of certain types of flammable liquids, including most Bakken crude oil, unless the tank cars were retrofitted to comply with new design standards.

CQ’s John Boyd reports that Transportation Secretary Anthony Foxx is not giving industry groups much time to comment on and help shape the final regulations. The DOT wants comments back within 60 days and does not plan to extend that comment period.

The department also proposes to make permanent its emergency order from May that requires that railroads notify state emergency response officials about trains containing 1 million gallons of Bakken crude oil which pass through their states.

In addition to last year’s railroad accident in Quebec which Bakken crude exploded and killed 47 people, an explosion last December forced evacuation of Casselton, N.D., and an April 30 derailment in Lynchburg, Va., caused a fire and led to evacuation of the surrounding area.

As The Container has reported, at least one major oil shipper sees rail as by far the preferred alternative to waiting for pipeline companies to build more pipelines to get the Bakken crude from North Dakota to terminals and refineries.

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