In 2009 there was one safety inspector for every 500 carloads of crude oil. In 2013 there was one inspector for every 21,000 carloads. This is a concerning trend.
Since 2013, there have been eight tank car accidents killing 47 people and resulting in hundreds of evacuations. Approximately 1.2 million gallons of crude spilled on U.S. railroads, more than the previous four decades combined, of which all but 10,000 of those gallons originated in North Dakota.
The above table illustrates the phenomenal growth of oil by rail. A staggering 4000% increase in shipped car loads, fueled by new tank car construction that is forecast to average 25,000 new cars annually until 2020. The current backlog is 48,000, equating to a three year wait.
Despite the importance of ensuring safety, the infrastructure and resources to support this growth and provide oversight remains unchanged. In fact, the main regulatory body overseeing the transport of hazardous materials, the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA), has no dedicated staff in North Dakota. Since 2008, it has employed 11 inspectors covering 11 states and only recently added another two to the central region. The Federal Railroad Administration (FRA) has yet to add to its eight inspectors.
Rail shippers are only one part of the logistics equation. For example, an oil company whose expertise is drilling and refining may either own outright or lease tank cars and contract the loading services of a shipping company. Then there are the actual railway lines and locomotives that are operated by an entirely different company.
In some cases, the oil company dictates to the leasing and shipping companies what seals, procedures and other safety equipment to use. Sometimes it is the shipping company who decides, while other times it is the leasing company.
So what happens when there is an NAR? Is it the tank car owner’s fault, the shipper’s fault or the oil company’s fault? How does this system promote transparency or develop a more efficient market when there are historically a limited number of vendors?
There is no question that everyone is working to prevent accidents, but nature and its elements make this a difficult and cumbersome job to perform. What is needed is a better forum to share and promote safer, more efficient equipment and better procedures to mitigate this escalating problem. Currently, neither the industry nor government agencies are willing to test, evaluate and promote new ideas.
The United States is on course to becoming the largest oil producing nation. Even if the planned Keystone Pipeline does get the necessary approvals, the demand and need for oil-by-rail will continue to grow. Similarly, while the majority of recent accidents have been caused by derailments, it would be folly to believe that NARs are at a sustained level. More inspectors are going to find more incidences. Those additional fines are going to fund additional hires and so on.
Industry best practices are only as good as the equipment and tools available. That is why the Parker Manway Nozzle Gasket is one response to halt this growing trend. Not only does it immediately resolve 95% of all manway related NAR issues, which is almost 50% of all NARs, it also reduces loading times and costs by as much as 90%. For more information visit Parker ISS and watch a short video below.
For more NARs related content, see the series of posts below: