“Tacoma, WA, is now the Northwest city most threatened by #oiltrains.”
With no fanfare whatsoever, Tacoma has claimed a new, though dubious, distinction: it is now the Northwest city most threatened by oil trains. As new research by Sightline reveals, a combined 80,000 barrels per day of crude oil—about 8 loaded trains per week—are permitted to travel on a publicly owned railway into the heart of Tacoma’s industrial area. In addition, another 15 loaded trains bound for north Puget Sound refineries can also pass through the city each week.
No other urban center in the region plays host to so much oil train capacity inside city limits.
The risks of oil trains have been made plain by the 10 catastrophic explosions that North America has seen in the last two years, to say nothing of the billion-dollar risk to the public that is virtually uninsured. The two terminals put the people of Tacoma directly in harm’s way of a fiery derailment, the likes of which have become all-too-common in the news.
Uncommonly, though, Tacoma’s local rail system is publicly owned, so unlike other places that see oil trains, the City of Destiny also bears the risk of financial catastrophe from an oil train derailment. It’s a risk so severe that even a single accident might bankrupt the city.
Tacoma is the home to both the US Oil Refinery and Targa Sound Terminal, each with the capacity to receive roughly 40,000 barrels of oil per day by rail. US Oil has been receiving loaded oil trains since late 2012. Targa was granted authority to expand in December 2013, yet the public was almost entirely unaware of it until now.
Both operate with the support of Tacoma Rail, the city’s publicly owned railway.
Neither project received any meaningful review or input from the public.
Nestled within the Port of Tacoma’s land, but sitting on private property, US Oil operates the smallest of the Northwest refineries, with a rated capacity of 39,000 barrels per day. In 2012, the plant’s owners spent $8 million building a new rail yard. Based on oil train movement data reported by BNSF Railway and figures from the Washington Department of Ecology, Sightline estimates that the facility can accept roughly 40,000 barrels of crude per day, on average, from oil trains.
Also located adjacent to the Port of Tacoma, Targa Resources, a Texas-based transportation, storage, and wholesale energy company, has shifted focus toward crude-oil-by-rail operations, dramatically expanding their ability to simultaneously unload railcars in late 2014. Permits indicate that the terminal now has handling capacity to move 40,000 barrels of crude oil per day brought in on trains and moved onto marine vessels. As of this writing, however, Targa had not yet secured customers to use its facility and had not yet begun receiving oil trains.
“It’s a risk so severe that even a single #oiltrain accident might bankrupt the city.”
The oil trains run on a publicly owned rail line: Tacoma Rail. A division of Tacoma Public Utilities, the railroad manages rail switching and terminal service. It picks up oil trains from the BNSF mainline and moves them to their destinations in Tacoma’s industrial area. The rail line is dependent on its industrial customers for earnings, but the lines of authority and accountability string back to the Public Utility Board and City.
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Oil train derailments and fires are distressingly common and incredibly destructive. They can also be extremely expensive. Officials estimate that the deadly oil train explosion in Lac–Mégantic, Quebec will cost roughly $3 billion. Sightline’s review of rail mishaps and federal cost estimates reveals that an oil train fire in an urban area could easily result in $5 billion in damages. Federal regulators and analysts have come to similar conclusions.
Yet it appears that Tacoma Rail’s operations are covered only by a $60 million self-insurance policy. It’s provided by Tacoma Public Utilities to cover both the railroad’s operations and the city’s Power and Water divisions. Yet $60 million might not be enough to cover the damages from even a modest oil spill (and leaks are quite common on oil trains), much less the multi-billion dollar damages that could be incurred by an actual oil train fire inside city limits.
Railroads are responsible for the costs of derailments and damages inflicted on third parties, not the shipper or the receiving site or anybody else. So because Tacoma Rail is a city-owned entity, it’s Tacoma’s taxpayers who are underwriting the risk attached to every oil train running on the city’s tracks. Given the enormous costs connected to oil train mishaps, it’s reasonable to suppose that even a minor derailment could bankrupt the public utility—and thereby the city—in a heartbeat.
Consider that Tacoma’s entire 2015–2016 budget anticipates just over $3 billion in revenue needed to fund city expenses. The cost of an incident like the one in the rural town of Lac–Mégantic would therefore be equivalent to the entire city budget for two years. It would roughly total the Utility portion of the budget for more than four years.
According to federal databases, Tacoma Rail has notched up a half-dozen freight derailments since 2007. That’s not a terrible incident rate for a small railroad, but when dealing with explosive crude oil, even a single incident could change the city forever.
John Abbotts contributed research to this article.
What route is taken by those 23 trains per week?
I believe they travel first through Spokane, Washougal, Camas and Vancouver.
Eric de Place
Yes, they do! All those places actually see more oil train traffic passing through than Tacoma does.
I single out Tacoma for two reasons: 1) it has two large receiving sites well inside city limits; and 2) the responsible RR is publicly-owned and radically under-insured against the risk. Those things aren’t true in other places.
Tacoma is largely acting as if ‘bomb trains’ aren’t of concern. Great research on the taxpayer liability for Tacoma Rail!!
Mr. de Place,
On behalf of Tacoma Rail, I’m extending an offer to provide you a tour of our rail facilities. Being on site might help you better understand our operations – and would provide accurate information for future reporting. If you are interested, please feel free to contact me.
Chris Gleason, Community & Media Services Manager
Tacoma Public Utilities
Even if you spared no expense to make your shortline absolutely safe, this is not just about Tacoma. The oil trains endanger a million people between Spokane, Vancouver and Tacoma.
In winter of 2014, in Clatskanie Oregon, an oil train was standing still and a large generator was being loaded on to a nearby truck, and slipped off creasing the tank car.
Ecology says that at best, 14% of the oil is recovered in an oil spill.
And I note with amusement (but not surprise) that the author appears to be ignoring this invitation. Evidently, facts aren’t all that important.
Eric de Place
Chris Gleason and I are engaged in an email exchange about this post. He is welcome (as you are) to leave comments pointing out alleged inaccuracies so that we can evaluate those claims publicly.
I stand by what we wrote here.
Chris Gleason is a woman. What you wrote is accurate within limits, but does not tell a complete story. I know you’re not trying to be a credible reporter of any kind, but there’s a certain lack of Bushido in posting what amounts to a Jr. High School-level civics report some sort of expose. I mean, did you contact a single human being involved with anything you are commenting on? I want to know what the calculated risk is. Does 10 accidents out of 40,000 or 50,000 trips per month (…that’s probably low) signify a meaningful risk. Were any risk assessments conducted? What were the findings? Do they provide more of a clear idea of the risk, and less of a freaking Scooby Doo-level cheeseball scare factor, as your “article” does? I mean, go ahead and stand by it. But don’t be surprised if people who know what they are talking about point and you and giggle.
How does US Oil have a capacity to receive 39K barrels per day of crude yet you estimate they receive 40K barrels per day of crude by rail? How can they exceed their daily capacity? Have they shut out crude by water receiving completely? Curious what is meant by “rated” capacity. Thanks in advance for your clarification.
Eric de Place
To be clear, there are two different things you’re referring to:
1. The facility’s actual receiving capacity for oil trains, which we estimate at 40,000 bpd.
2. The facility’s oil refining capacity, which they say is 39,000 bpd.
The discrepancy between these numbers is because the facility has apparently moved (relatively small) quantities of crude oil from train to vessel without actually refining it. It’s entirely conceivable that refineries like US Oil receive shipments of oil-by-rail than they don’t refine, but simply handle and ship out to some other destination. There’s convincing evidence that is what has happened here, in small volumes.
I just noticed a large modern & busy Bakken crude oil train off-loading facility at the Port of Tacoma (Targa?). How would citizens best be able determine the volumes being refined vs. exported? Are crude oil tankers even allowed in the Puget Sound? The Bakken crude oil terminal in Clatskanie along the Columbia River received a very very minimal fine for handling 600% their legally permitted volumes using a taxpayer funded terminal originally built for biofuels.
See the fines paid for by Global Partners LLC in Clatskanie, OR. 5 or 6 times their permitted volumes. Self-reporting. A mere cost of doing business. Watch for all of this with Targa & US Oil.
This article is pure histrionics and it falls apart on even the most casual scrutiny. It’s basically a bunch of made-up BS.
Eric de Place
Well don’t be shy, Dave. If the piece is so paper thin, then please share with us where you think it is inaccurate.
In the meantime, please feel free to use the hyperlinks we included to evaluate the supporting research.
Yes, oil trains are hazardous, but the idea that Tacoma faces more danger than any other city is completely false. The trains are brought to and through Tacoma by BNSF railroad, on the Portland to Seattle main line. BNSF is a class one railroad owned by Berkshire Hathaway, which has very deep pockets.
Tacoma Rail takes the trains from BNSF across the tide flats a couple of miles to the local oil facilities. That is done at very low speeds, around 10-20 MPH. At such speeds, a derailment isn’t likely to cause much more than some torn up track and a little dust. Tacoma Rail has almost zero chance for a major accident and liability.
Trains have been carrying materials far more hazardous than crude oil through Tacoma since the late 19th century.
We, as a nation, have a choice to make. We can either ship domestically produced oil by rail and pipeline, or we can go back to >$5 a gallon gas and fight wars in the middle east. The fact is that, right now, we need the oil.
My vote would be to keep improving on train safety and start building more pipelines, while working on alternative sources of energy for the future. Histrionics and paranoia will get us nowhere.
Eric de Place
Thanks for weighing in here, but I disagree with almost everything you said.
Let’s start with BNSF. They’ve already had two oil trains derail and explode on their mainline. They have failed to properly report hazardous substance train derailments in Washington at least twice in the last few years (including one in Tacoma). They’ve been hit by state regulators for hundreds of failures to report leaks and spills during a recent four-month period. The federal government has fined them repeatedly for inadequate track maintenance. And just this summer a jury awarded $1.25 million to a whistleblower who was fired for reporting hundreds of unsafe track conditions between Tacoma and Seattle.
Sources for these facts are here:
BNSF (like all other North American RRs) is radically under-insured against the reasonable worst-case cost estimates of oil train fires. That something widely acknowledged both by the nation’s leading commercial liability insurers and also by the railroads, which now appear to be seeking public underwriting of their insurance policies. (And, no, Berkshire would step in to cover a multi-billion dollar shortfall.)
Tacoma Rail does a good job of handling trains. I agree. But it’s not true that these trains are safe at low speeds. The older tank cars are often referred to as “the Ford Pinto of rail cars” for good reason. And even the newer models are riddled with well-documented design flaws, perhaps the most worrisome of which are the bottom outlet valves that break/crack/shear even at very slow speeds and spill their contents. Then you have volatile hydrocarbons + sparks…
We do not need oil trains. The nation is so awash in crude oil that the industry is in a full court press to lift the country’s 40-year export ban so that we can send unrefined American oil to our competitors abroad. In fact, there’s so much oil train capacity planned for the PNW that even if we took not a single drop from existing pipelines or tanker vessels, we still couldn’t come close to refining it all. In short, we definitely do not need it. And it’s not even for us.
Thank you for your excellent reporting, and for addressing so incisively the issues raised by commenters.
I’ve been concerned about this issue since I first began noticing surprisingly long oil trains passing along Ruston Way last fall. I’m familiar with some of the disasters caused by oil derailments and explosions in recent years, including the 2013 incident in Lac-Mégantic, Quebec that you reference above. Knowing of the oil trains passing through Tacoma alerted me to the risk that a similar disaster could befall us. I’ve studied the problem enough to know that despite what the railways and their oil company clients tell us, there’s no way to make the rail shipment of oil safe. Rail is a great way–the best way, in fact–to transport most things, but it’s a terrible way to transport oil, particularly at a time when we need to be moving away from oil as an energy source.
Learning that the City of Tacoma itself is likely to be on the hook for a bill for damages that could easily bankrupt the city adds insult to potential injury. My hope is that your bringing attention to the threat of municipal financial ruin will finally get the attention of voters and our elected officials.
Tacoma is an amazing city with a rich history and a promising future, and the idea of having that all taken away from us in a blaze of petroleum fumes (and an oil spill in Commencement Bay) is one of the saddest fates I can imagine. It’s time for us to begin transitioning to those renewable energy sources–in particular, solar and wind–that are already viable right now.
We need more informed reporting of the kind in this article. I plan to share it widely.
This is definitely a concern that everyone should be concerned about. Only last month 17 rail cat derailment happened in the port of Tacoma. Luckily the cars were empty, but it should be a wake-up call to the dangers involved. I grimace everyone I see a school bus stop at a railroad crossing. The school district understands the dangers of rail collisions while the city encourages more dangers. Besides the oil trains and the two large processing plants, the city is now trying to get another highly dangerous LNG (Liquefied Natural Gas) plant to locate in the port next to the Targa site. The danger created by the 8 million gallon storage tank can only be measured in equivalent energy by tons of dynamite or nuclear bombs. Again, the city is way underinsured. The $30 million insurance policy is insignificant when even a small accident is considered. When thinking of the worst case, it would involve an accident that would impact the Targa plant, the LNG plant and rail cars which are all located next to each other. Why the city would allow/consider such a perfect recipe for a disaster of this magnitude is beyond belief. We could easily replace Quebec as the example of the worst rail car accident.
Sightline, thank you for keeping us informed.
This discussion is largely based on emotion and without statistical probability of occurrence. Not saying there is no concern. Just saying factor out the arbitrary emotion and deal with the reality… whatever that turns out to be. Risk vs gain.
Holy crap are you kidding me? The older rail cars are the “Ford Pinto of rail cars?” That is proof right there that you are just cooncerned about scare media/reporting. There are not 8 trains per week. If so then are there that many trucks purging off the prior days refinement to allow for the next train to fill them to capacity based on your “research.” Please explain how a train on a mainline railroad doing 30, 40, 55 mph involved in a derailment is the equivalent of a 4 mph event.
Someone mentioned 10-20 mph at Tacoma Rail. The railroad operates under a rule that requires 10 mph max for movement.
Please provide the detail on all of the derailment that you report about. How many involved hazmat? How much product was spilled in each one? What impact to the residents of Tacoma from these?
Also the big railroads deliver the trains to Tacoma Rail not getting picked up by them.
Understand your concern but such loose reporting smells of scare tactics instead of matter of fact stuff that allows people to make up their own minds and act upon the information.