Thursday, February 27, 2014

Most Bakken crude can move under FRA Emergency Order

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The most onerous burdens under the Emergency Order issued by the Federal Railroad Administration Feb. 25 fall upon crude shippers and transloaders. The earlier regulatory vagueness concerning the classification of crude oil has now been sharpened by specific prescriptions for evaluating “flash point; boiling point; corrosivity to steel and aluminum; presence and content of compounds such as sulfur/hydrogen sulfide; percentage presence of flammable gases; and the vapor pressure at 50ºC.”

Adding the infrastructure and expertise for such analysis is a cost to be borne by the shipper side of the crude-by-rail partnership. The order authorizes the continued use of DOT-111 cars for all types of crude while the FRA pursues its review of tank car standards.

For railroads themselves, the biggest impact of the emergency order is the mandatory handling of all crude oil as a “security sensitive” commodity.

Before the emergency order, crude oil classified as Packing Group III was exempt from the homeland security requirement that TSPs (transportation security plans) be in place for hazmat shipments that could attract terrorist attack.

That exemption was identified Jan. 23 by the National Transportation Safety Board as a benefit some transloaders derived, intentionally or not, by down-classing volatile crudes to low-risk Packing Group III. That advantage is now gone. All crude must be classified as Packing Group I or II, with all of the attendant obligations under homeland security law and regulation.

This may interrupt some, but not most, CBR movements. Railroads already have transportation security plans in place, if not for high-risk crude specifically, then for other explosive commodities such as ethanol. Those plans may well be extended with little modification to cover all crude oil shipments.

However, for oilfield-to-refinery routings not already covered by existing security plans, new plans must be developed and implemented before trains are allowed to roll, according to FRA spokesman Kevin Thompson.

“Crude oil may not be shipped unless there is a security plan in place,” Thompson told Railway Age.

However, Thompson noted that “most Bakken crude was already offered as Packing Group I or II and is consequently already covered by security plans.”

The regulations under homeland security legislation became effective at the start of 2009, so carriers have had time to comply for the initially specified hazardous materials, generally Class I and II explosives, as well as the two most volatile packing groups for Class III flammable liquids.

The FRA is confident, Thompson said, that compliant security plans are in place for most Class I and short line CBR routes. “We have current audits on 22 of the 27 short lines that carry crude oil or ethanol. We have recently audited CSX and Norfolk Southern, and have audits no older than two years for all other Class I carriers.”

There is no grace period to allow carriers to move oil trains while they develop the mandatory plans. Thompson said carriers should not expect any FRA tolerance arising from the preamble to the “final rule” published Nov. 26, 2008. That preamble states that the regulation is not meant to allow carriers to refuse hazmat shipments on the grounds that a plan has not been completed.

“We do not intend for the provisions of this rule to impede the everyday commerce of hazardous materials, or to change the common carrier obligation of the railroads to handle security-sensitive materials that shippers tender to them for shipment,” reads the 2008 final rule.

Thompson insisted that FRA’s “expectation” is that the shipment of crude without a fully implemented security plan will cease immediately.

The elements of a security plan are detailed in CFR Title 49, Part 172.802. (Italicized sub-heads are added by Railway Age for reference and clarity.)

Components of a security plan

(a) The security plan must include an assessment of transportation security risks for shipments of the hazardous materials listed in §172.800, including site-specific or location-specific risks associated with facilities at which the hazardous materials listed in §172.800 are prepared for transportation, stored, or unloaded incidental to movement, and appropriate measures to address the assessed risks. Specific measures put into place by the plan may vary commensurate with the level of threat at a particular time. At a minimum, a security plan must include the following elements:

Security Clearance of Rail Employees Handling or Having Access to Crude Oil

(1) Personnel security. Measures to confirm information provided by job applicants hired for positions that involve access to and handling of the hazardous materials covered by the security plan. Such confirmation systems must be consistent with applicable Federal and State laws and requirements concerning employment practices and individual privacy.

Guarding of Storage Tanks and Empty Tank Cars

(2) Unauthorized access. Measures to address the assessed risk that unauthorized persons may gain access to the hazardous materials covered by the security plan or transport conveyances being prepared for transportation of the hazardous materials covered by the security plan.

Anti-Terrorist Protection of Trains En Route

(3) En route security. Measures to address the assessed security risks of shipments of hazardous materials covered by the security plan en route from origin to destination, including shipments stored incidental to movement.

Senior Manager Responsible for Plan Development and Implementation

(b) The security plan must also include the following:

(1) Identification by job title of the senior management official responsible for overall development and implementation of the security plan.

Security Job Descriptions for Each Person Responsible for Plan Implementation

(2) Security duties for each position or department that is responsible for implementing the plan or a portion of the plan and the process of notifying employees when specific elements of the security plan must be implemented.

Compulsory Hazmat Training for Employees Handling or with Access to Crude Oil

(3) A plan for training hazmat employees in accordance with §172.704 (a)(4) and (a)(5) of this part. (Part 172.704 (a) . . .

(4) Security awareness training. Each hazmat employee must receive training that provides an awareness of security risks associated with hazardous materials transportation and methods designed to enhance transportation security. This training must also include a component covering how to recognize and respond to possible security threats. New hazmat employees must receive the security awareness training required by this paragraph within 90 days after employment.

(5) In-depth security training. Each hazmat employee of a person required to have a security plan in accordance with subpart I of this part who handles hazardous materials covered by the plan, performs a regulated function related to the hazardous materials covered by the plan, or is responsible for implementing the plan must be trained concerning the security plan and its implementation. Security training must include company security objectives, organizational security structure, specific security procedures, specific security duties and responsibilities for each employee, and specific actions to be taken by each employee in the event of a security breach.

Security Plan Must Be in Writing

(c) The security plan, including the transportation security risk assessment developed in accordance with paragraph (a) of this section, must be in writing and must be retained for as long as it remains in effect. The security plan must be reviewed at least annually and revised and/or updated as necessary to reflect changing circumstances. The most recent version of the security plan, or portions thereof, must be available to the employees who are responsible for implementing it, consistent with personnel security clearance or background investigation restrictions and a demonstrated need to know. When the security plan is updated or revised, all employees responsible for implementing it must be notified and all copies of the plan must be maintained as of the date of the most recent revision.

Requirement to Provide Security Plan to DOT or Homeland Security upon Request

(d) Each person required to develop and implement a security plan in accordance with this subpart must maintain a copy of the security plan (or an electronic file thereof) that is accessible at, or through, its principal place of business and must make the security plan available upon request, at a reasonable time and location, to an authorized official of the Department of Transportation or the Department of Homeland Security.