01/17/2014 05:29 pm ET Updated Jan 25, 2014

Oil Train Safety Issues Were Known Before Recent Crashes, NBC Investigation Shows


Several recent deadly and destructive derailments have drawn greater attention to using railroads to ship crude oil, but a new NBC News investigation found that federal regulators have known about the risks for some time.

Overloading trains and mislabeling tanks are among the problems that officials flagged months before the deadly crash at Lac-Mégantic, Quebec in July 2013 according to U.S. government report obtained by NBC. It's unclear if the report was shared with Canadian railroad regulators.

A team of hazardous materials inspectors with the U.S. Federal Railroad Administration visited dozens of rail facilities in North Dakota in the fall of 2011 and again in June 2012. The officials found overloaded tank cars to be a "major problem," and noted that it was caused by the fact that many of the truckers who transport the crude from well sites to the trains lacked the ability to effectively measure the weight of the load entering the tank cars.

Inspectors said there is a regional shortage of rail tank cars. Their reports even cited one company that transloads oil from trucks into trains that was found shipping the product in tank cars that weren't up to code. Pressure on the loading company to ship the oil, according to the report, "was more than the risk of failure in transportation or discovery by FRA."

During a second round of visits to facilities in North Dakota in 2012, inspectors discovered that some companies had also mislabeled the oil as less flammable than it really was. NBC explains:

Companies handling relatively dangerous crude were shipping it under labels meant for more stable, less flammable crude, inspectors found. Paperwork at the facilities showed the companies were dealing with crude designated as Packing Group I or II, designations for high or moderate risk materials.

But inspectors noted the oil was going out as Packing Group III -- the lower-risk designation often used for traditional, heavier crude. Inspectors noted that the designation could “affect the selected emergency response and even the type of package required or tank car in this case,” regulators wrote.

The Department of Transportation's Pipeline and Hazardous Materials Safety Administration issued an alert on January 2 stating, "recent derailments and resulting fires indicate that the type of crude oil being transported from the Bakken region may be more flammable than traditional heavy crude oil."

North Dakota has seen a boom in oil and gas production from the Bakken formation, which underlies part of the state (along with portions of Montana, Manitoba and Saskatchewan). More than 10 percent of U.S. oil production now comes from this rock formation and the hundreds of thousands of barrels of oil produced every day in North Dakota exceed the capacity of existing pipeline infrastructure. Many oil producers have turned to rail to ship their crude to refineries. Most U.S. oil pipelines run north-south, but the Bakken producers' light crude usually fetches a higher price at markets on the east or west coast, InsideClimate News explains.

Over 99.99 percent of hazardous material rail shipments reach their destinations safely, according to the railroad industry, but the oil-by-rail boom has brought several notable, and fiery, crashes in recent years.

In July 2013, a 72-car oil train from North Dakota derailed and exploded in the small town of Lac-Mégantic, Quebec killing 47 people and setting off a debate on railroad safety.

Another train derailment in North Dakota last month spilled about 400,000 gallons of crude.

There have also been numerous other incidents involving a class of rail tank car known as DOT-111. The DOT-111 -- a giant, black, pill-shaped tanker that can carry 34,500 gallons of oil, chemicals, fuel or other liquids -- represents 69 percent of all U.S. rail tank cars. Accidents are not unheard of for these cars, and the federal government has known about the DOT-111's "inadequacy" for transporting certain materials since at least 1991.

In September, the Department of Transportation's Pipeline and Hazardous Materials Administration announced it was seeking public comments for a new set of rules to improve the safety of railroad tank cars.

The Association of American Railroads -- an industry trade group representing major freight carriers, Amtrak and some commuter railroads -- announced in November that it supports efforts to improve the puncture resistance of new DOT-111s, make retrofits to older tank cars and phase-out those cars that cannot be retrofitted, among other changes.

"The industry, if they are motivated, can undertake preventative steps that will enhance the safety of the movement of these materials across the country," U.S. Transportation Secretary Anthony Foxx said this week following a closed-door safety meeting with oil and railroad executives, according to the Associated Press.



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