The crude gamble – part two

For part one of this article, please click here.

Much of the criticism around oil train safety today revolves around old rail cars. Critics say they’re not safe enough – especially not to handle shale oil from places like the Bakken, which has proven to be more volatile, meaning derailments are more likely to cause fiery disasters. Simply put -"Each tank car of crude holds the energy equivalent of 2 million sticks of dynamite or the fuel in a wide body jetliner," write Russell Gold and Betsy Morris in the Wall Street Journal.

But CSX, the rail firm whose train derailed recently, said the tank cars involved were the newer and supposedly tougher CPC 1232 models – not older model cars many say are too easily punctured in rail mishaps.

Pipelines have been used to transport American natural gas or oil, including from Canada to the US, for three quarters of a century. Almost 500 000 miles of interstate pipeline crisscross America, carrying crude oil, petroleum products, and natural gas. This extensive and operational infrastructure network is heavily regulated by the Department of Transportation (DOT), which monitors safety and reliability.

A review of safety and accident statistics provided by the US Department of Transportation for the extensive network of existing US pipelines – including many linked to Canada – clearly show that, in addition to enjoying a substantial cost advantage, pipelines result in fewer spillage incidents and personal injuries than road and rail. Americans are more likely to get struck by lightning than to be killed in a pipeline accident.

Oil and gas will have to travel to where it is needed whether it is produced in Canada, Alaska, North Dakota, or the Gulf of Mexico. The first large-diameter long-distance pipelines were constructed during the Second World War, and they proliferated across the country over the ensuing two decades. Now America has 175 000 miles of onshore and offshore petroleum pipeline and 321 000 miles of natural gas transmission and gathering pipeline. In addition, over 2 million miles of natural gas distribution pipeline send natural gas to businesses and consumers.

This is expected to increase as households and businesses shift to natural gas to take advantage of low prices that are expected to last into the probable future. Pipelines are the primary mode of transportation for crude oil, petroleum products, and natural gas. If safety and environmental damages in the transportation of oil and gas were proportionate to the volume of shipments, one would expect the vast majority of damages to occur on pipelines but the facts demonstrate the exact opposite. The majority of incidents occur on road and rail. And when it comes to transporting oil, pipelines are the safest option, trumping trains and trucks, according to a new report from Canada’s Fraser Institute.

Pipelines carry the bulk of oil moving across the United States and Canada each day, even though the surge in North American production has pushed more and more crude into onto trains, trucks and barges. US data on incidents from 2005 to 2009 “show that road and rail have higher rates of serious incidents, injuries and fatalities than pipelines, even though more road and rail incidents go unreported,” said the report authors, Manhattan Institute Senior Fellow Diana Furchtgott-Roth and Kenneth Green, Senior Director of natural resource policy studies at the Fraser Institute.

The researchers say the “superior safety and environmental performance of pipelines is hardly surprising,” since the pipes are often buried underground and less exposed to damage. And there is extra protection in that pipelines allow oil to flow through its shipping container, rather than via containers that are being hauled around. “When you have more moving parts, more potential interactions with other non-controlled actors such as trains and trucks, the potential for accidents is higher when compared to pipelines,” Green said.

Both the U. Department of Transportation (DOT) and US State Department have asserted that pipelines are the safest, most cost-effective and least carbon intensive way to deliver petroleum products. Needless to say, due to their enormous presence in America’s fuels network, the technology behind pipelines has evolved considerably over the past decades making them safer with remarkable strength and durability.

The new generations of pipes contain state-of-the-art protection systems and all welds are X-rayed to make sure welding is done properly and before being put into service. Pipelines are pressure tested at 1.5 time’s normal operating pressure for any potential leaks. Once the pipe is placed in the ground, a series of instrumented modules that scan every square inch of the pipe from the inside are run through the pipe to record information about the internal conditions of the pipeline, forming a complete record of the baseline condition of the pipe. The operating system has pressure sensitive sensors and valves that would automatically shut down all sections of the line in the event of any loss in pressure.

According to the American Petroleum Institute, in excess of 190 000 miles of liquid petroleum pipelines crisscross the US, connecting production areas to refineries and chemical plants delivering the energy consumers and businesses need. Pipelines are an exceptionally safe and efficient way to transport energy across the country. Accordingly, a barrel of petroleum product shipped by pipeline reaches its destination safely more than 99.999% of the time.

Pipelines spills decreased more than 60% from 2001 to 2012 and according to the US Pipeline and Materials Safety Administration (PHMSA), the number of spills classified as “serious” and “significant” has decreased. Pipeline incidents, while rare, do still happen and the pipeline operators prepare for the unlikely event of an incident through computerised control centres and training to stop any spill quickly upon a release. In addition operators also develop emergency response plans, deploy resources, and work frequently with local first responders in order to reduce the spill impact. Pipeline operators work with the National Transportation Safety Board (NTSB) to determine the causes of the incidents and offer fixes and long-term remedies.

Additionally, pipeline companies do fund millions of dollars worth of research into new inspection technologies and spend billions on safety yearly, taking active measures to ensure that safety, security and environmental concerns and issues are addressed throughout the planning, construction, and operational phases of pipeline operations.

The companies also work to prevent spills by evaluating; inspecting and maintaining pipeline in a programme called Integrity Management (IM), such program resulted in fewer incidents attributed to every major cause of failure.

Pipeline companies are viewed by Wall Street as engines of growth, especially as the oil glut in the US continues, John Edwards, a Senior Analyst and Director at Credit Suisse stated – “I think if you look at the safety record of crude oil pipelines versus alternatives, pipelines come out on top,” and “Release rates as of 2012 were roughly 25 barrels per billion barrel miles. So a very, very low rate of incidents taken over the hundreds of thousands of miles of pipelines that transport millions of barrels of oil per day”.

References

1. 1 http://www.wsj.com/articles/SB10001424052702303749904579577861760037536
2. 2 http://www.csmonitor.com/Environment/Energy-Voices/2015/0217/After-fiery-West-Virginia-train-derailment-is-oil-by-rail-safe-video
3. 3 http://blogs.wsj.com/experts/2014/11/24/rail-vs-pipeline-which-is-safer-for-moving-oil/
4. 4 http://www.manhattan-institute.org/html/ib_23.htm#.VOUFIm90zYA
5. 5 http://www.realclearmarkets.com/articles/2012/06/21/pipelines_the_safest_way_to_move_fuel_99730.html
6. 6 http://fuelfix.com/blog/2013/10/17/pipelines-safer-than-trains-and-trucks-report-says/
7. 7 http://www.saugertiesx.com/2015/01/29/overy, pinion-pilgrim-pipeline-offers-a-safer-way-to-transport-oil/
8. 8 http//www.cnbc.com/id/101898359#

Read the article online at: https://www.worldpipelines.com/special-reports/29042015/the-crude-gamble-part-two/