E&P Exec Skeptical About Effectiveness of DOT Tank Car Order

Responding to a string of recent derailments of trains carrying crude oil from the Bakken Shale play, the U.S. Department of Transportation (DOT) late last month issued an emergency order requiring all crude-by-rail shippers to ensure that the product is tested and classified according to federal safety regulations.

The emergency order immediately requires that all lower-risk, "Packing Group III" (PG III) crude shipments – treated as flammable liquids – be transported in more robust tank cars used to carry "Packing Group I" (PG I) and "Packing Group II" (PG II) hazardous materials. The derailments, which occurred in the states of Alabama and North Dakota and the Canadian province of Quebec, all carried Bakken crude in "DOT-111" tank cars used to carry PG III shipments.

"Today we are raising the bar for shipping crude oil on behalf of the families and communities along rail lines nationwide – if you intend to move crude oil by rail, then you must test and classify the material appropriately," commented DOT Secretary Anthony Foxx in a Feb. 25 press release. "And when you do ship it, you must follow the requirements for the two strongest safety packing groups."

The outspoken head of an exploration and production (E&P) company with operations in the Bakken and other shale plays recently told Rigzone that the order is not well-thought-out, and he questions how high DOT's emergency order will actually raise the proverbial bar. Moreover, he contends that better enforcement of existing rules and the approval of TransCanada's Keystone XL oil pipeline project would improve the safety of shipping crude oil. Read on for more insights from Chris Faulkner, CEO of Dallas-based Breitling Energy.

Rigzone: As the head of an E&P company, what does the U.S. Department of Transportation's emergency order mean for you in the near term? Longer term?

Faulkner: There are already reports of rail shipments slowing down, possibly as a result of the DOT's emergency order. If the order is enforced, it could continue slowing things down for a while because it requires more testing. But I would expect that to be short-lived, either because companies will simply fall into a new routine or they'll simply ignore the emergency order.

Rigzone: You've indicated that the order itself may not be well thought out. Why is that?


View Full Article

Matthew V. Veazey has written about the oil and gas industry since 2000. Email Matthew at mveazey@rigzone.com


Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies
 Company: US Department of Transportationmore info
 - E&P Exec Skeptical About Effectiveness of DOT Tank Car Order (Mar 7)

Our Privacy Pledge

More from this Author
Matthew V. Veazey
Senior Editor | Rigzone
 -  How to Sell Yourself in the Job Search... (Jul 24)
 -  What Will Brexit Mean for Downstream I... (Jul 24)
 -  A Newcomer's Guide to Oil and Gas: A G... (Jul 17)
 -  TWITTER POLL: Rigzone Readers Weigh In... (Jul 14)
 -  Report: For Now, NOC Refiners Winning ... (Jul 11)

Most Popular Articles

From the Career Center
Jobs that may interest you
Electronics technician
Expertise: Electrical Technician|Field Service Tech|Mechanical Technician
Location: El Reno, OK
International Accountant
Expertise: Accounting
Location: Downers Grove, IL
Pipeline Technician - Arrow
Expertise: Heavy Machinery Operator|Pipeline Services|Piping Technician
Location: Keene, ND
search for more jobs

Brent Crude Oil : $48.6/BBL 1.12%
Light Crude Oil : $46.34/BBL 1.24%
Natural Gas : $2.9/MMBtu 2.35%
Updated in last 24 hours