The recent drop in global oil prices has led to “dwindling” crude-by-rail shipments through California cities, including Richmond, but with the prices rising again state officials expect the shipments will pick up, the Sacramento Bee reported Thursday.
Richmond officials and residents have been concerned about the potential for derailments and explosions since shipments of the highly volatile Bakken crude from North Dakota began rolling into the local Kinder Morgan rail terminal last year. The public was made aware of the shipments as the result of a media investigation in February last year, but since then local jurisdictions have not had much luck in stopping the federally-regulated railway activity, aside from postponing at least one Bay Area crude-by-rail plan.
The energy market has had more success. As global oil prices dropped last fall, lower prices for other types of oil made Bakken “marginally less marketable in California,” California Energy Commission fuels specialist Gordon Schremp told the Bee.
As oil prices fell, Bay Area refiners reportedly halted crude by rail shipments in November, said Paul King, rail safety chief at the California Public Utilities Commission.
In fact, such shipments from out of state “virtually stopped,” King told the Bee, adding none are expected for the remainder of March.
According to the Bee: Most notably, the BNSF Railway recently stopped running a 100-car train of volatile oil from the Bakken region of North Dakota through the Feather River Canyon and midtown Sacramento to the Bay Area. The trains, several a month, carried an estimated 3 million gallons of fuel each.
But don’t expect this trend to continue. As oil prices rise again, state officials expect Bakken shipments through cities including Richmond to resume.
“We don’t have any concrete info about when it will resume,” King told the Bee. “When prices come up, it is likely to resume, and that could be in months.”
The main concern is the uptick in explosive derailments caused by the shipments, including one that occurred in a small town in Quebec that killed 47 people and destroyed the town in 2013.
In West County, according to Richmond City Manager Bill Lindsay, the potential blast zone of rail lines carrying Bakken crude oil would impact 27 schools, Kaiser Hospital, four community centers, most of the neighborhoods in Richmond, the Richmond Civic Center, the Richmond police headquarters and five of seven Richmond fire stations.
Read more of the background behind crude-by-rail shipments in the state and U.S. in the Sacramento Bee’s full report here.