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Crude rail shipments down but not out

Crude rail shipments down but not out

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Oil train

A train carrying oil cars moves through the BNSF railyard in Minneapolis.

With lower crude oil prices, North Dakota drillers dramatically cut production over the past winter and spring, but trains continue to roll through Midwestern communities loaded with the volatile cargo.

Data released this week by the U.S. Energy Information Administration show that even as overall volumes of crude rail shipments fell last year, the amount of crude on the nation’s rails last year was still higher than in any year prior to 2014. The 325.8 million barrels was more than twice what was shipped in 2012 and 16 times the level in 2010.

In the first three months of this year, more than 33.6 million barrels of oil were shipped by rail from Midwestern rigs. That works out to more than five fully-loaded trains each day. At the peak of the Bakken oil boom it was about 12 trains per day.

Overall U.S. oil production in the first quarter of 2016 was down only 4 percent from the all-time peak in 2015.

For perspective, trains carry less than 5 percent of the nation’s oil supply (the majority flows through pipelines). But most of the crude that is shipped by rail comes from the 13-state Midwest region, and more than 80 percent of that comes from North Dakota, which last year pumped out more than 428 million barrels.

That volatile Bakken oil ends up in refineries around the country, but more than half goes to the East Coast, and the most direct rail routes run through Minnesota and Wisconsin. Two of those lines — the BNSF and Canadian Pacific — intersect in La Crosse.

Midwestern crude rail shipments were down less than a percent in 2015, according to the EIA, and there was a slight increase in the amount moved from the Midwest to the East Coast.

According to the most recent information filed with state safety officials, BNSF reports moving 20 to 30 oil trains per week on its lines that run along the Wisconsin bank of the Mississippi River. That’s down from the 39 trains per week the railroad reported in June 2014.

On the Minnesota side, Canadian Pacific in March reported an average of just over five trains per week, down from nine in 2014.

The sharp rise in oil train shipment that happened between 2010 and 2014 prompted concern among citizens and lawmakers, especially after several fiery crashes, including a a 2013 runaway train that exploded in Lac-Megantic, Quebec, killing 47 people and leveling nearly half the town.

Five U.S. oil trains derailed last year, including a BNSF train that went up in flames after leaving the tracks near Galena, Ill., and a Canadian Pacific train that left the tracks in Watertown, Wis. Last week a Union Pacific train carrying oil derailed and caught fire in Oregon’s Columbia River Gorge.

The federal government has moved to make tank cars safer and step up rail inspections, but rules adopted last year by the Federal Railroad Administration allow the older model tankers to remain in service through 2023, and the Department of Transportation’s inspector general said in April the agency has not taken the necessary steps to carry out its oversight of rail bridge safety.

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