Questions Raised on Stabilizing Bakken Crude For Rail Transport

By The Bakken magazine staff | September 22, 2014

Stabilizing Bakken crude for rail shipment might not be necessary, cost-effective or result in greater safety, according to a consultant with Turner, Mason & Co.

After the U.S. Department of Transportation in July released proposed regulations to change safety requirements for trains and tank cars hauling Bakken crude, U.S. Rep. Ron Kind, D-Wisc., sent a letter to Transportation Secretary Anthony Foxx asking the agency to consider a requirement to stabilize the oil before shipment.

Kind said that “Bakken oil is much more volatile than most other types of heavier crude oil” and poses a significant risk of fire. He referred to a company in south Texas that is stabilizing crude to make it safer for transport. News reports quoted Kind as saying the process was “cheap” and “easy to do.”

However, Ryan Couture, a chemical engineer and senior consultant with Turner, Mason & Co., said there’s a great deal of difference between light sweet crude from Bakken and condensates from the Eagle Ford play in Texas.

“The condensates in Texas are substantially lighter and more volatile than Bakken crude,” he explained. “Their vapor pressure is high enough in Eagle Ford condensate that it cannot be shipped via pipeline, and stabilization is required in order to meet the specifications for transport.”

Based in Dallas, Turner, Mason & Co. monitors all aspects of the crude and refined product markets, and how regulatory developments impact the industry.  The firm was recently engaged by the North Dakota Petroleum Council to conduct a comprehensive study on Bakken crude, which was issued by the NDPC in early August.

Couture also questions the economic feasibility of stabilizing Bakken crude for rail transport and whether it would result in improved safety.

“One challenge to stabilizing Bakken crude in North Dakota before shipment is that you then end up with stabilized crude and LPGs (ethane/propane/butane),” he said. “There is no substantial market for LPGs in North Dakota, which means they would have to then be shipped. The hazards with shipping LPGs are greater than shipping Bakken crude if an accident were to occur.”

The American Petroleum Institute criticized DOT’s rationale for the proposed rail transport regulations.

“The best science and data do not support recent speculation that crude oil from the Bakken presents greater than normal transportation risks,” said API President and CEO Jack Gerard. “Multiple studies have shown that Bakken crude is similar to other crudes.”
API plans to submit comments to DOT about the regulations before the Sept. 30 deadline of the public comment period.