Fourteen States And The District Of Columbia Sue Over The Ruling To Allow LNG Transportation By Rail

On June 19, 2020, authorization of bulk transportation of liquefied natural gas (LNG) by rail was authorized by the Pipeline and Hazardous Materials Safety Administration (PHMSA) and the U.S. Department of Transportation (USDOT), in consultation with the Federal Railroad Administration (FRA). The ruling was set to go into effect on  August 24, 2020, but has been delayed by two lawsuits suing federal agencies over the recent ruling. One lawsuit was filed by 14 states and the District of Columbia and argues the USDOT and PHMSA did not sufficiently evaluate the ruling’s impact on the environment, and that its safety requirements are insufficient. The second suit, filed by environmental groups with the U.S. Court of Appeals for the D.C. Circuit, asks that the rule be reviewed and vacated.

What are the concerns about shipping LNG by rail? And what will the delay in authorization to ship the product mean?

The economic impact of shipping and storing LNG

LNG is natural gas that has been converted to liquid by cooling it to about -260° Fahrenheit. The process of making LNG is complex, involving a highly flammable gas that is chilled and condensed.

Liquefying the gas allows it to be shipped to areas that pipelines don’t reach, and to be stored in tanks until it is regasified – returned to a gaseous state – for use. In liquid form, the volume of natural gas is 600 times smaller than its volume as a gas, making it easier to store and ship. One LNG tanker can carry enough LNG to heat 10 million homes for a day.

In 2007 the U.S. imported 771 billion cubic feet (Bcf) of natural gas to meet its needs, but the opening of new fields in the U.S. and new extraction techniques caused imports of natural gas to drop to 52.8 Bcf in 2019. Between 2005 and 2018, U.S. natural gas production grew nearly 70 percent, taking the U.S. from importing LNG to one of the world’s largest exporters. The increase in domestic production and exporting has led to the need to find ways to store and ship the product.

The ruling

In the April 2019 executive order associated with this ruling, President Trump highlighted the U.S.’s growing role as a producer of LNG for domestic markets, and an exporter for international markets. Under the July 2020 ruling, the Federal Railroad Administration specified the following requirements for U.S. LNG shipment by rail:

• The DOT-113C120W9 (DOT-113) specification tank cars are required to have enhanced carbon steel outer tank requirements and additional operational controls.
• The LNG tank cars will be monitored remotely to track their location and ensure the tank car pressure is adequate to keep the gas in a liquefied state.
• To improve braking, the train is required to have a two-way end of train or distributed power system based on the train’s total number of LNG tank cars, or the number of cars in a continuous block.
• Railroads are to conduct “routine risk assessments to evaluate safety and security.”

The official version of the final rule has been published by the Federal Register and can be found at docket no. PHMSA-2018-0025 on the regulations.gov website.

The claim that shipping LNG by rail isn’t safe

LNG is primarily liquefied methane gas, and methane is highly flammable, as are other explosive petroleum products that LNG plants use to refine and refrigerate the gas. U.S. Representative Peter DeFazio (D-Ore.), has stated the new rule is “reckless”, posing substantial risk to the public. Brian Frosh, Maryland Attorney General, is leading the coalition of states fighting the rule, and says “Ships carrying LNG have been characterized as floating bombs. Rolling tank cars filled with LNG through our neighborhoods are vastly more dangerous.”

Opponents of the rule also cite past disasters that occurred when liquefied gasses were transported by rail, or when LNG spilled:

• A 2014 explosion at an LNG facility in the state of Washington injured five workers and forced hundreds of people to evacuate their homes.

• A 1984 spill from an LPG
  

  San Juanico LPG Explosion, 1984

   storage and distribution center outside of Mexico City produced a vapor cloud that was ignited by a flare pile and produced explosions that registered 0.5 on the Richter scale.
• In the mid-2010s, a boom in crude oil led to train cars transporting volatile crude in DOT-111 rail cars, a predecessor of the DOT-113. There were a number of accidents and spills, including a derailment in 2013 in Lac-Mégantic, Quebec, in which dozens of DOT-111 rail cars derailed in the center of town, resulting in a fire that destroyed most of the town and killed 47 people.

According to Joseph O. Minott, executive director of the Clean Air Council, “There’s a very good reason liquefied natural gas has never been shipped by rail in this country, and that’s because it’s wildly unsafe. I don’t want these dangerous trains going through my neighborhood, and trust me, you don’t either.”

The American Association of Railroads disagrees, noted that records show 99.99% of the transportation of hazardous materials by rail is accomplished without incident, and that the efforts to strengthen tank car standards is adequate to ensure safety.

The DOT-113 tank car

One of the hottest points of contention is the safety of the DOT-113 railcars. These cars have been used to transport other liquefied gasses, such as ethylene. They are vacuum insulated, and their structure is that of a tank within a tank. The current industry standard for cryogenic tank cars is ASTM A516-70 steel, but the ruling specified LNG tank cars must be made of TC-128 grade steel, which is less likely to crack or puncture. The Pipeline and Hazardous Materials Safety Administration (PHMSA) notes that the DOT-113 was involved in 14 crashes over a 37-year period, and the inner and outer hulls were only breached twice.

The National Transportation Safety Board (NTSB) and other opponents of the new ruling dispute that premise and have called for a “thorough safety assessment” of DOT-113 safety in transporting LNG before transportation is allowed to proceed.

What additional safety measures and testing are being requested?

Many industry experts and regulatory oversight agencies believe shipment of LNG by rail may well be safe, but that further testing and additional regulations are needed to ensure adequate safety. According to a July 28, 2020 report from the Congressional Research Service, the NTSB, the coalition of state attorneys general who have filed the suit, environmental groups, and other groups have recommended the following additional safety testing be satisfactorily completed and the following measures be in place prior to allowing rail car shipment of LNG:

• Complete the FRA additional rail safety testing of multimodal ISO tank containers filled with LNG to assess the risk of increasing the number of LNG cars in a shipment.
• Require railroads conduct more frequent track and rolling stock inspections to reduce the chance of derailment.
• Confirm that the crashworthiness of tank car design standards, braking systems, train speed, routing analysis, and the preparedness of emergency responders are sufficient to reduce the consequences of a derailment, including cascading failure.
• Require the rail industry follow the guidelines of AAR Circular OT-55, the industry safety standard for trains carrying 20 or more cars of hazardous material. Among other requirements, Circular OT-55 limits the speed of key trains to 50 miles per hour and specifies the frequency of inspections of tracks and rail cars supporting their movement.
• Further improve the design features of the DOT-113 tank car by requiring “double-shelf” couplers (already required for tank cars carrying hazmat) to reduce the chance of cars becoming decoupled in a derailment. Additionally, reinforce valve openings and/or housings, where product is loaded or unloaded from the tank car, so that they do not shear off during a derailment.
• To prevent or delay explosions, further address limits on internal tank pressures and maximum product allowed to be loaded.
• If existing DOT-113 tank cars are used for LNG transportation, require the DOT to perform a comprehensive review of the crashworthiness and puncture resistance of the DOT-113 tank car at different speeds.
• Complete the TCC evaluation of the DOT-113 tank car design that was in progress but was delayed by the COVID-19 outbreak.
• Re-categorize LNG as Class 3, flammable liquid, rather than Class 2.1, a flammable gas. Doing so would place it under the more stringent and appropriate Highly Hazardous Flammable Trains (HHFT) operating rules, including imposing mandatory speed limits.
• To reduce the time required for an emergency braking signal to reach all cars, utilize a second signal device or another locomotive at the end of the train to simultaneously begin signaling braking forward.
• Evaluate the cost/benefit of requiring cars carrying flammable liquids to have Electronically Controlled Pneumatic (ECP) brakes, which can simultaneously signal all the cars to begin braking.
• Evaluate having trains transporting LNG cars avoid densely populated areas or other risk-sensitive areas.
• Employ detection technologies, such as ultrasonic probes or acoustic and temperature sensors, to spot track and railcar defects long before they can cause a derailment.
• Evaluate equipment failure history and operational and environmental factors to pinpoint track segments and railcars that are at higher risk and warrant more frequent inspection.
• Train emergency responders along the proposed shipping route in conformance with National Fire Protection Association standards, including known hazards in emergencies involving the release of LNG, and emergency response methods to address an incident involving a train transporting LNG.
• TSA has promulgated additional security regulations for shipments of certain other hazmat materials that are considered to have a particularly high risk of use in attack against persons or critical infrastructure within the U.S. Such regulations include documenting the chain of custody and control. It is suggested that these regulations also be applied to shipments of LNG.