Everyone in the oil and gas industry needs to do their part to improve the transportation system.
A certain degree of self-regulation is necessary if the transportation of oil and gas from the Bakken region is going to become safer and more efficient. All contractors involved in the transport of crude need to do their part. While none of them handle the material through the whole process, from well to refinery, the responsibility is on them to make sure everything is correctly labeled and properly handled, and that at whatever point in the process they’re involved, everything is done right.
The future health of your business, the communities in which you work and that region’s oil and gas industry as a whole depends on making sure this happens. If accidents continue to happen, changes will come that may make doing business in the Bakken oilfields much more difficult.
Proponents of rail and pipeline transport will tout their safety records, noting the overwhelming volumes and percentage of shipments that safely reach their destination, but the people of North Dakota are more likely to take note of and remember the Dec. 30 derailment that spilled 400,000 gallons of crude in Casselton, N.D. The people of Quebec will remember the derailment that resulted in massive explosions, the destruction of much of the small town of Lac Megantic, and the loss of 47 lives. The 99.9 percent of shipments that safely made it to their destination offer little consolation to them.
One of the factors that made those derailments so explosive is the level of flammability of oil from the region. In some cases, tanker car loads of Bakken oil have been labeled improperly. Cynthia Quarterman, an administrator with the U.S. Pipeline and Hazardous Materials Administration, has been quoted as saying the PHMSA is concerned about the possibility shippers have not been fulfilling their requirements in terms of testing and classifying and knowing what is coming out of the field.
A statement from The American Petroleum Institute, which represents the oil industry, noted that “The oil and natural gas industry continues to work with regulators and the rail industry to make shipment by rail as safe as possible. Our industry has asked the government repeatedly to improve its railcar regulations, and we voluntarily began several years ago producing and using cars that are safer.”
That push from within the industry is a necessary, proactive step toward significant improvements, but it must come from every level of the industry. There is a big difference, at least in the eyes of the farm owner whose land is leased for drilling and local residents living near the rail system, in the industry pushing for a higher standard rather than the government forcing a begrudging industry to make changes.
For their part, the Federal Railroad Administration, in a 2012 report, pointed to the difficulty of enforcement, even with new regulations. “Ownership, responsible party, accountability is difficult to determine,” the report noted. “Between developers, well owners, subcontractors, marketing companies, distribution companies, trucking concerns, independents, tank farms (product holding companies), track owners and end users, compliance is challenging.”
As the volume of oil shipped by rail continues to rise, stronger safety measures and greater accountability will grow more and more important. It starts on the drilling pad and continues all the way to the refinery. Everyone, at every step of the way, needs to do their part to ensure that proper protocols are followed. Everyone needs to do their part to ensure safety, minimize environmental impact and put a positive face on the oil and gas industry.