An explosive situation?

Posted: December 11, 2013

AT 1:14 A.M. JULY 6, a warm Saturday morning, a runaway train carrying 35,000 barrels of crude oil from North Dakota careened into the small Quebec town of Lac-Megantic.

The wreck sent what one witness called "a tsunami of fire" into a packed nightclub, killing 47 people, five of whom were so badly incinerated that no trace of them could be found.

And the shock waves were felt in Philadelphia, more than 500 miles away.

Just three months earlier, South Philly's former Sunoco refinery, rebranded as Philadelphia Energy Solutions, had begun accepting more-than-a-mile-long trains, each with more than 100 of the same model tanker car that went to Lac-Megantic, each filled with the same North Dakota crude.

The new refinery owners have plans to ship roughly 5 million barrels of crude oil every month, right through the heart of Center City along the Schuylkill.

"The next day, I dispatched three men there to investigate," said Philip Rinaldi, chief executive of Philadelphia Energy Solutions, the largest refinery complex on the East Coast, who wanted to know if there were any safety lessons for the first major crude-oil-by-rail operation to move through America's fifth-largest city in decades.

To Rinaldi and some other experts, the chance of a Lac-Megantic-type accident here are minimal. They point to an unlikely series of errors in the Quebec mishap and say that the CSX line in Philadelphia is a major Class 1 freight railroad, traveling through the city at a 30 mph speed limit, often on elevated tracks, with no highway grade crossings where accidents are most likely.

But the remarkably rapid rise in crude shipments by rail over just a couple of years - the result of an oil boom in the American heartland - has other safety experts and environmentalists highly concerned.

An aging fleet

Experts note that federal regulators have done little or nothing about reports that the aging fleet of oil-tanker cars used in Philadelphia and elsewhere are prone to rupture too easily.

There are also concerns that the chemical makeup of North Dakota crude makes it more likely to burn more intensely in a wreck.

"I think the main point here is that environmentally harmful and potentially dangerous sites such as these do not belong anywhere near population centers," said Erika Staaf, the clean-water advocate for the nonprofit PennEnvironment.

"We've seen time and again the risks involved with fossil-fuel extraction - from drilling and mining to transport to waste disposal - and the closer these operations are to population centers such as South Philadelphia, the higher the risk to nearby residents."

It's an issue that was on no one's radar screen just a couple of years ago, when the United States imported the majority of its crude oil. Almost all of the oil refined in South Philadelphia at the site that was then solely owned by Sunoco arrived by ship, much of it from Africa.

But the process known as hydraulic fracturing, or fracking, has been a game changer - extracting oil and natural gas from places where it was once too complicated and too expensive to drill. Domestic crude-oil production has surged 40 percent in the past five years and the United States now produces more oil than it imports, on track to pass Saudi Arabia and become the world's top producer by 2015. And the primary method to transport crude from the gusher-laden Bakken field in North Dakota - landlocked, with limited pipeline capacity - is by rail.

The North Dakota surge has revitalized the South Philadelphia facility, said to be America's oldest continuously operating refinery but which had briefly appeared doomed when Sunoco announced it was getting out of that side of the business in 2011. Philadelphia Energy Solutions is a joint venture including the giant Washington, D.C.-based defense contractor Carlyle Group and Philly-based Sunoco.

"Today, between 75 and 80 percent of the crude oil we refine is domestically sourced crude oil - the lion's share of which has come by rail," said the firm's Rinaldi. Philadelphia Energy Solutions earlier this year christened a new $100 million rail terminal at the refinery and employs close to 1,000 people, including 65 at the terminal.

The trains, which now arrive in the city five to six times a week - a rate that's expected to double by next year - are pulled by Burlington Northern from North Dakota and the surrounding region to Chicago, where they switch to a CSX route through Buffalo, Albany and New Jersey before crossing into Bucks County and the central spine of Philadelphia.

A second spike in oil-by-rail traffic is expected in the region early next year, when the newly formed Eddystone Rail Co. opens an 80,000-barrel-a-day terminal in Delaware County.

A 'moving pipeline'

The current oil train - CSX K040 - already has sparked excitement among "railfans" who compete to post photos to the Internet and videos to YouTube, and it's not hard to see why. The trains are more than a mile long, typically with 104 tanker cars rumbling by - a massive "moving pipeline" with about 70,000 barrels of crude.

But what excites "railfans" also worries environmentalists.

As rail shipments of crude across America have soared, so has the number of accidents. In July, EnergyWire reported that spills and other oil-related accidents on the tracks rose from one or two a year in the early 2000s to 88 reports in 2012. Most reported incidents are quite small, but a few have been spectacular, like the fiery derailment of a 12-tanker oil train near the Alabama-Mississippi border in early November.

Among experts, the biggest criticism is the industry's reliance on the older black cylindrical tanker cars known as the DOT-111, which comprise more than two-thirds of the U.S. fleet and which are the type used in South Philadelphia and involved in the Quebec disaster. Critics say these tanker cars are prone to puncture and explode in an accident because the wall is too thin and because of design flaws that experts have complained about for more than 20 years. A proposed fix was delayed for a year by regulators in the Obama administration - just days after Lac-Megantic.

The cars' design "definitely raises the risk," although the biggest problem remains human error, said John Goglia, a former longtime member of the National Transportation Safety Board who now works as a consultant. Human error is believed to have been a primary cause of the Quebec crash, in which the train's sole operator had checked into a motel and left the engine running, with the train parked atop a hill outside Lac-Megantic.

But the extent of the carnage there - several blocks of the town burned down - and in Alabama have also caused some experts to wonder whether the light, sweet crude produced in North Dakota is prone to catch fire too easily - possibly because the shipments contain hydrogen sulfide, which is toxic and flammable.

Safety of utmost concern

Rinaldi of Philadelphia Energy Solutions said safety is his No. 1 concern - as evidenced by his interest in learning what happened in Quebec - but he remains convinced that oil transport through Philadelphia is safe and that a large-scale accident would be almost impossible. He said that's because the CSX line is a Class 1 railroad, whereas the Quebec crash happened on a smaller rural "short-line" track, and because the trains run on isolated tracks no faster than 30 mph, down to just 7 mph near the South Philly terminal.

"We take this extra seriously. Refining oil is by its nature a business where you have to be really careful," Rinaldi said.

Philadelphia's director of emergency planning, Samantha Phillips, said that in the wake of the publicity over the tragedy in Quebec, she toured the refinery this October and feels confident that local police and fire units could respond well to an accident. "I have a much better understanding of what's going to be happening there," she said.

But ultimately one's view of the risks of Philadelphia's unexpected 21st-century oil rush probably depends on whether one views made-in-the-USA fossil fuel as a source of jobs and cheaper gas at the pump - or as a contributor to global warming and greater health risks.

Said PennEnvironment's Staaf: "When it comes to the transport of hazardous materials - whether it's related to petroleum processing or shale-gas extraction or anything else - it's really a lose-lose situation."


On Twitter: @Will_Bunch

Blog: ph.ly/Attytood.com

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