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Providing coverage of Alaska and northern Canada's oil and gas industry
August 2015

Vol. 20, No. 35 Week of August 30, 2015

Pipe’s clear edge over rail

Canadian researchers say crude-by-rail 4.5 times more dangerous than pipelines, endorsing US Congressional report that pipe cheaper

GARY PARK

For Petroleum News

A conservative Canadian public policy think-tank has issued a report that says choosing between pipelines and rail for transporting oil is no choice at all.

The Fraser Institute, drawing on data from the Canadian Transportation Safety Board and Transport Canada, says the decade ending 2013 shows that pipelines are 4.5 times safer for the same volumes of crude.

“I hope it becomes better understood that saying ‘No’ to a pipeline is saying ‘Yes’ to rail and that is to increase the risk to the environment and human health and not decrease it,” said lead study author Ken Green.

“I people want to make rational decisions about these things, they have to understand that.”

The Fraser Institute notes that federally regulated pipelines in Canada - those that cross provincial borders - currently move almost 15 times more hydrocarbons than railroads.

Over the decade covered by the study, pipelines recorded 1,226 “occurrences” compared with 127 for rail, but the comparative numbers, when adjusted for comparable volumes and distances, showed 0.049 occurrences per thousand barrels equivalent shipped by pipeline and 0.227 for rail transportation.

The Canadian Transportation Safety Board statistics showed 73 percent of pipeline “occurrences” resulted in spills of less than 1 cubic meter (about 1,000 liters), while 16 percent did not result in any spillage.

About 83 percent of the pipeline-related incidents took place in compressor stations, processing plants and terminals and not in actual pipelines, which improved the chances of containing the leaks.

Similarly, only 15 percent of the rail “occurrences” took place in the transit phase.

Impact of new regs unknown

Green is not prepared to speculate on whether the harmonized tank car regulations adopted in Canada and the United States will make crude-by-rail transport safer.

He said most rail accidents are the result of human operator error, which the industry has no hope of eliminating which leaves questions hanging over what impact new technology and hardware, automatic, pneumatic braking systems and heavier steel for tank cars will have on rail safety.

The study said there is already a databank of pipeline vs. rail safety in the United States covering the shipment of hydrocarbons.

It said the U.S. State Department, as part of its evaluation of the Keystone XL pipeline proposal, calculated that between 2002 and 2009 releases per million ton-miles transported by rail were 0.0033 compared with 0.0006 for pipe, indicating rail is 5.5 times more likely to experience a release.

The department concluded that a “lot of oil can be recovered” from pipeline accidents, reaching 40 percent from 1992 to 2011.

Fewer per-mile pipeline injuries

In weighing health and safety aspects, the Fraser Institute said the State Department gave a clear advantage to pipelines, noting that injuries and deaths per ton-mile transported by rail “far exceeded those associated with pipelines.”

Comparing the known rates, the State Department estimated that even without an increase in transport volumes, rail would result in 712 injuries and 94 fatalities on an annual basis compared with three injuries and two fatalities for pipelines.

If the 830,000 barrels per day of capacity planned for Keystone XL were added to the rail system that would result in another 49 injuries and six fatalities a year compared with one additional injury and no deaths if the pipeline was built.

The study said a recent U.S. Congressional research service report on crude transportation methods estimated “pipelines would provide safer, less expensive transportation than railroads.”

In conclusion, the think tank said that if Canada “is to realize the massive economic benefits from the development (of Alberta’s oil sands) the transport conundrum must be solved.”

“At present resistance to pipeline transport is sending oil to market by modes of transport that pose higher risks of spills and personal injuries, such as rail and road transport.

“While different data sets are not directly comparable, an examination of studies from the U.S. and our analysis of the Canadian data strongly suggest that pipelines are the safer way to move oil compared to railways or roadways.”






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