Federal fines for crude oil on trains do not address tank car safety

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WASHINGTON — The Department of Transportation announced fines Tuesday for three oil companies for not properly classifying the crude oil it loaded into rail cars.

However, even if the oil had been properly labeled as more dangerous, it could still have been loaded into the same rail cars with a long history of catastrophic failures in accidents, because current federal regulations allow it.

The Pipeline and Hazardous Materials Safety Administration began investigating whether companies were properly labeling crude oil from North Dakota's Bakken shale region last August, a month after a fiery derailment killed 47 people in Lac-Megantic, Quebec.

That incident and subsequent derailments have led federal regulators to conclude that Bakken shale oil is more volatile than other kinds and should be handled with special care.

Tuesday's fines are the first from that effort, and Hess, Whiting Petroleum and Marathon Oil will pay a combined $93,000 in civil penalties.

"The fines we are proposing today should send a message to everyone involved in the shipment of crude oil," said Transportation

Secretary Anthony Foxx. "You must test and classify this material properly if you want to use our transportation system to ship it."

But oil producers, rail companies and tank car manufacturers are still waiting on the transportation department to issue new standards for tank cars. The DOT-111A cars involved in derailments in Quebec, Alabama and North Dakota lacked safety protections that could have made those accidents less severe, including thicker shells and steel plates to prevent punctures.

The National Transportation Safety Board, which has no enforcement power, has recommended improvements to the DOT-111 cars since 1991, and for tank cars carrying hazardous materials generally since the early 1970s.

Tank cars carrying flammable and toxic gases were retrofitted in the 1980s, but that was well before railroads began moving large volumes of crude oil and ethanol, a business that has only developed in the past decade or so.

Railroads themselves don't own most tank cars; rather, shippers lease them from tank car manufacturers and financial institutions.

Since 2011, tank car manufacturers have voluntarily built DOT-111A cars to a higher standard, with steel shields to help prevent punctures on the vulnerable ends, or heads, of tank cars, and stronger fittings where the cars are loaded and unloaded.

Jeannie Shiffer, a spokeswoman for the pipeline and hazardous materials regulator, which is responsible for writing tank car standards, said that proper classification of hazardous materials was "the beginning of the process."