On December 9 the North Dakota Industrial Commission issued an Order requiring production facilities to separate volatile gases, the so-called “light ends,” like propane and butane, from crude oil before it is shipped to ports and refineries. Twenty percent of all crude oil produced in North Dakota is shipped by rail to refineries in Philadelphia. Significant amounts are also shipped to New Jersey and Delaware.
Crude from the Bakken Formation is generally recognized as more explosive and flammable than other domestic crudes because it has a significantly higher vapor pressure than other strains of crude. As vapor pressure of crude increases more, and more volatile, gasses are released. As a result, when trains carrying Bakken crude, in contrast to oil with lower vapor pressure, derail there is often an explosion and destructive fire that follows.
Under the Order, operators must condition Bakken crude to a vapor pressure of no more than 13.7 pounds per square inch. The national standard at which crude is deemed “stabilized” is 14.7 pounds per square inch. The light hydrocarbons separated from the crude cannot, under the Order, be blended back before shipment.
State officials plan to conduct field inspections to enforce the Order, which carries a penalty of up to $12,500 per day for violations. The Order will take effect on April 1. “This will significantly change the characteristics of [North Dakota] crude oil that’s going into market,” State Mineral Resources Director Lynn Helms said. “It will meet the stable crude oil standard.”
Industry officials had argued the regulations under the Order are too specific in setting industry mandates and could create unintended consequences, such as increased flaring and increased air pollution. Regulators dismissed petroleum industry arguments that the rules shift the discussion from rail safety to the product itself, asserting that “Our responsibility is to make sure the Bakken crude is safe before it gets on the train.”
Citizen watchdog groups, like The Coalition for Bakken Crude Stabilization, are similarly unhappy, contending that the Order does not establish vapor pressure standards low enough to render Bakken crude “safe” for transport by rail.
The fact is, independent tests have shown Bakken crude to have a vapor pressure of 16 pounds per square inch. The Order will at least assure that all Bakken crude is stabilized to the national standard and that is a good development for those who live, work and play within a half mile of railroad rights-of-way over which Bakken crude is transported.