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Wed, 2014-09-17 08:59Justin Mikulka
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Bomb Trains Keep Rolling While Congressional Committee Bickers About Bakken Crude

Congressman Paul Broun

When DeSmogBlog reported last week that no actual petroleum scientists would be testifying at the congressional science committee’s hearing on the characteristics of Bakken crude oil, we knew the hearing was unlikely to make any substantial progress toward improving the safety of transporting this volatile oil on trains through American communities.    

Indeed, we expected the hearing would be an exercise in avoiding getting the facts about Bakken crude to further delay or avoid regulations that would require the oil to be stabilized. But what actually transpired surprised even us and bordered on the absurd.

While the hearing was conducted under the banner of the Committee on Science, Space and Technology, it was co-chaired by Subcommittee on Energy chairman Cynthia Lummis (R-Wyo.) and Subcommittee on Oversight chairman Paul Broun (R-Ga.)

During his opening remarks, Congressman Broun ripped into the Obama administration for denying his attempts to get “experts in the subject matter” as witnesses.

While I look forward to hearing from both panels today, I must say I am disappointed — though not surprised — at this Administration’s continued unwillingness to work with the Congress. Chairman Lummis and I invited representatives from the agencies who are experts in the subject matter because we are interested in the science behind Bakken crude. Instead, both agencies appearing before the Committee today declined to provide the witnesses we requested, sending us in their place witnesses more knowledgeable on the politics behind Bakken crude. As I said, I am not surprised, just disappointed.

Tue, 2014-09-09 05:00Justin Mikulka
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Goldman Sachs Warns Investors About Tar Sands By Rail Challenges While Investing in Tar Sands By Rail

Oil by rail

In 2009, Matt Taibbi wrote a piece in Rolling Stone in which he described the investment bank Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” 

Apparently tar sands oil smells like money. And thus the vampire squid has found another target. As Reuters reported on August 29:

A Goldman Sachs-led rail terminal operator, USD Group LLC, announced on Friday plans to form a Master-Limited Partnership this year to trade publicly on the New York Stock Exchange.

This new company will be based around a tar sands rail loading facility in Hardisty, Alberta. That is the same place where the proposed Keystone XL pipeline would begin. USD Group already owns a crude-by-rail terminal in the town, with capacity to load two 120-car unit trains per day.

And with the success of this first phase of development, the company has announced plans to double the capacity of the terminal, which would allow it to load 280,000 barrels per day (bpd). The company has also announced plans to add another 70,000 bpd, which would bring its capacity to 350,000 bpd, or roughly half the proposed capacity of TransCanada’s Keystone XL pipeline.

Mon, 2014-09-08 11:56Justin Mikulka
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How Many Crude Oil Scientists Will Testify At Congressional Science Committee Hearing on Bakken Crude? Zero

Bakken crude

Bakken petroleum: the substance of energy independence.

If you think that sounds like the latest branding from the oil industry’s public relations efforts, you might be right. However, it isn’t an ad — it is the title of the congressional hearing on Bakken oil on Tuesday.

When North Dakota congressman Kevin Cramer first announced he would hold this hearing, he promised to bring together the top scientists to discuss the properties of Bakken crude.

Here’s how he explained it when being interviewed by the 6:30 Point of View television show. 

I want three good solid scientists… consultants apart from all of the politicians and the presidential appointees. And I’ve promised them a very fair thorough review of the data and the evidence and the information. So that we can, you know, answer definitively and scientifically what is the volatility, if you will, of Bakken crude. How does it compare to other crudes?”

Congressman Cramer was apparently unable to find those three good scientists. Here are the five people who will be witnesses at the hearing.

Fri, 2014-09-05 13:30Justin Mikulka
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Safety of Citizens in Bomb Train Blast Zones in Hands of North Dakota Politicians

Lac Megantic train explosion

When North Dakota Congressman Kevin Cramer was asked recently if it was scientifically possible to make Bakken crude oil safer by stripping out the explosive natural gas liquids with a process like oil stabilization, his response was quite telling.

So scientifically can you do it? Sure, but you have to look at it holistically and consider all of the other elements including economics, and is the benefit of doing something like that does that trump other things like speed of trains, and what kind of cars,” he said.

This is very similar to the comments made by Lynn Helms of the North Dakota Department of Mineral Resources according to the July 29 meeting minutes provided to DeSmogBlog by the Industrial Commission of North Dakota.

In response to a question regarding other mechanisms besides oil conditioning in the field, Mr. Helms stated there are other mechanisms — none of them without a significant downside….It makes sense to do the conditioning in the field. There are other options to do it downstream somewhere in a very large and very expensive operation.”

Thu, 2014-08-21 09:32Justin Mikulka
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All Aboard! Tar Sands Bitumen by Rail Set to Eclipse Pipelines Like Keystone XL

“Rail can get you just about anywhere. It's like the Harry Potter stairway. You get on the stairs at one end and they move to wherever you need to go. That's the beauty of the railway. You get on at one end here, with your bitumen or dilbit, and then you can end up in different places depending on what are the best markets.”

That quote is from Pete Sametz, president of Connacher Oil and Gas, speaking to the Daily Oil Bulletin about the appeal of moving tar sands oil by rail. And Sametz isn’t alone in his enthusiasm for rail transportation options for bitumen. 

At the Canadian Institute's North American Pipeline Symposium in June, Randy Meyer of Canadian National railway, told the conference how this situation appeared to him. 

“It's kind of amusing when I read in the paper that there's this angst and gnashing of teeth about Keystone and I'm going, 'My goodness, we're already there.' We can go there and we are. We are shipping product there.

The reality is that tar sands bitumen transport is so well-suited for rail over pipelines that it is now cheaper to move tar sands bitumen by rail than it is by pipeline. If you're a tar sands industry executive, this is your light-bulb moment: Who needs the Keystone XL headache when you can bypass the controversy entirely using existing rail lines? 

Aside from the magical Harry Potter flexibility of rail compared to pipelines, rail also offers the option of moving bitumen without having to dilute it, as is required for pipelines, which makes it cheaper as explained by Randy Meyer. 

“We did a study where we took the American Association of Railway's published rates, which averaged out all the traffic that moves and all its products. That average … is about 16 per cent less than pipeline costs.”

This reality and the recent revelations that the impact of the tar sands oil will be much greater than initially predicted, present a grim picture for the environment, although apparently an amusing and exciting one for oil and rail executives. Companies like Grizzly Oil Sands outline their plans on their website. 

Tue, 2014-08-19 12:32Justin Mikulka
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Report Reveals Cost Cutting Measures At Heart Of Lac-Megantic Oil Train Disaster

Today the Transportation Safety Board of Canada (TSB) released its final report on the July 6th, 2013 train derailment in Lac-Megantic, Quebec. The report produced a strong reaction from Keith Stewart, Greenpeace Canada’s Climate and Energy Campaign coordinator.

This report is a searing indictment of Transport Canada’s failure to protect the public from a company that they knew was cutting corners on safety despite the fact that it was carrying increasing amounts of hazardous cargo. This lax approach to safety has allowed the unsafe transport of oil by rail to continue to grow even after the Lac Megantic disaster. It is time for the federal government to finally put community safety ahead of oil and rail company profits or we will see more tragedies, Stewart said.”

Throughout the report there is ample evidence to support Stewart’s position and plenty to show why the people of Lac-Megantic want the CEO of Montreal, Maine & Atlantic Railway (MMA), the rail company responsible for the accident, held accountable in place of the engineer and other low level employees currently facing charges.

At the press conference for the release of the report the TSB representatives often noted that they had found 18 factors that contributed to the actual crash and they were not willing to assign blame to anyone, claiming that wasn’t their role.

But several critical factors stand out and they are the result of MMA putting profits ahead of safety and Transport Canada (TC), the Canadian regulators responsible for overseeing rail safety, failing to do its job.

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