North Dakota’s top energy regulator unveiled new rules Thursday that would require companies to reduce the volatility of crude before it’s shipped by rail.
State Mineral Resources Director Lynn Helms told the state Industrial Commission that all crude from North Dakota’s oil patch would have to be treated to remove certain liquids and gases to “ensure it’s in a stable state” before being loaded onto rail cars. “The focus is safety first.”
Oil trains in the U.S. and Canada were involved in at least 10 major accidents during the past 18 months, including an explosion in Quebec that killed 47 people. Other trains carrying Bakken crude have since derailed and caught fire in Alabama, Virginia and North Dakota.
The Industrial Commission, which regulates North Dakota’s oil and gas industry, appeared to agree with the proposal in principal but wanted more time for review. The panel said it would hold a special meeting by Dec. 11. The proposed rules, if adopted, would take effect in February.
North Dakota Petroleum Council president Ron Ness said regulators are unfairly focusing on crude oil when the “root of the issue” is ensuring trains transport it safely.
Industry officials say stripping liquids and gases from Bakken crude would result in even more volatile products that would still have to be shipped by rail. It also would result in additional emissions because of heating the oil to remove gases, said Ness, whose group represents more than 500 companies working in the state’s oil patch.
About 80 percent of North Dakota crude already falls below the proposed standard, but required testing would ensure that all of it does, Helms said.
