Bakken rail shippers following the rules

Concerns on the margin, federal rail safety official says.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |  May 23, 2014 at 9:41 AM
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WASHINGTON, May 23 (UPI) -- The U.S. rail industry is following the rules for shipping Bakken crude oil, though some violations exist on the margins, the nation's top rail regulator said.

Last year, the Department of Transportation and the Federal Railroad Administration launched the so-called Bakken Blitz, spot inspections of crude oil shipments by rail to determine if the industry was labeling their cargoes properly.

A warning issued by federal regulators in January said Bakken crude oil may be more prone to fire if spilled than other grades of crude oil. A North Dakota study this week challenged those claims.

FRA Administrator Joseph Szabo told Platts energy news service most rail shippers were classifying Bakken crude oil according to the rules, though "there are pockets of concern."

Three CSX Corp. rail cars carrying Bakken oil through Lynchburg, Va., derailed and caught fire in early May. No injuries were reported, though a trace amount of oil spilled into an area river.

More than 40 people died as a result of a similar accident in Lac-Megantic, Quebec, in July.

Industry officials said the increase in North American oil production from shale reserves has put a burden on existing pipeline capacity, forcing some energy companies to look to rail as an alternate transit method.

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