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State seals its lips on oil carrying rail cars

Two agreements shield details on movement of Bakken formation’s crude by Glen Chase | June 18, 2014 at 5:23 a.m.
map showing location of rail lines in Arkansas

Arkansas has joined the list of states that have agreed to keep private the information supplied by railroads that ship volatile Bakken crude oil through the state in rail tank cars.

In May, the U.S. Department of Transportation issued an emergency order directing railroads to provide state emergency planners detailed information about the movement of oil trains carrying 1 million gallons or more -- equal to about 35 tank cars -- of crude oil pumped from the Bakken formation that underlies Montana and North Dakota and Saskatchewan and Manitoba in Canada.

The information to be given states includes the number of oil trains on a weekly basis, the counties they'll pass through and specific routes.

The order was prompted by a sharp rise in the number of rail tank cars being used to transport crude oil, as well as several accidents over the past year that resulted in spills, fires and fatalities. It took effect June 7. The order said "a pattern of releases and fires involving crude oil shipments originating from the Bakken and being transported by rail constitute an imminent hazard" under federal law.

However, the railroads, while willing to provide movement information to emergency planners, don't want details of the shipments released to the public, citing security and proprietary competitive reasons.

Kenny Harmon, hazardous-materials manager for the Arkansas Department of Emergency Management, said Tuesday that he's signed confidentiality agreements with both Union Pacific Railroad Co. and BNSF Railway -- the railroads with the most track mileage in the state.

Harmon said he was contacted by Union Pacific about two weeks ago and received the request from BNSF on Friday. He said he hasn't been contacted by the the state's other major railroad, Kansas City Southern, which has track in western Arkansas.

To date, Harmon said he hasn't been notified of any crude-oil shipments, adding that the department is still working out a process to notify county emergency-management coordinators when a Bakken crude train is scheduled to pass through. He estimates that about 35 of the state's 75 counties will get shipment notices.

In an information sheet posted online about the emergency order, the Transportation Department's Federal Railroad Administration said the movement data "is intended for those persons with a need-to-know." This would include state and local emergency responders as well as "appropriate emergency response planners."

It said the department expects state and local officials to "treat this data as confidential," and that railroads "may require reasonable confidentiality agreements" before providing the movement information. The sheet describes such agreements as similar to information "traditionally" viewed as confidential from business and security reasons that is provided confidentially to the states about commodities being transported, providing a precedent for keeping oil train movement information private.

The Transportation Department also is urging railroads to phase out older model DOT-111 tank cars used to ship crude in favor of cars built under new standards that call for thicker steel hulls, extra shielding at both ends of the car and improved fittings and pressure relief valves. The department also wants shippers to do a better job of labeling tank car contents.

Earlier this year, spokesmen for both Union Pacific and BNSF confirmed that the two railroads move tank cars filled with crude through Arkansas.

While Union Pacific has routinely provided information to help with emergency planning and response, railroad spokesman Stephanie Serkhoshian said in an email that movement information is restricted for safety, security and competitive reasons.

She said Union Pacific "has been very conservative" in how it interprets "sensitive security information" rules to avoid releasing information that might pose a security risk.

"Union Pacific believes that information relevant to crude oil shipments poses many of the same risks that the (sensitive security information) regulations are intended to address," Serkhoshian wrote. "For these safety, security and competitive reasons Union Pacific has asked receiving authorities to protect the information from dissemination and disclosure."

She said so far, seven states, including Arkansas, have signed confidentiality agreements while several others are reviewing the agreements. She said the movement information will be provided with the understanding that those states might need more time to consider the agreement.

BNSF spokesman Joseph Faust said the railroad works closely with emergency planners in the 28 states and two provinces where it operates to give them the information they need to respond in the event of a hazardous-materials spill.

He said the new mandate for timely Bakken crude shipment information created the need for the confidentiality agreement.

Some groups opposing the use of tank cars to ship crude oil have objected to the nondisclosure agreements.

The Times-Union of Albany, N.Y., reported last week that a request from railroad CSX that the New York Division of Homeland Security and Emergency Services sign a nondisclosure agreement drew fire from two groups worried that keeping the information secret would violate public-records laws and do little to keep the public safe.

North Dakota has yet to sign an agreement and the chairman of that state's Department of Emergency Services, Greg Wilz, plans to recommend the state emergency response commission reject it, spokesman Cecily Fong said Tuesday.

That state's Department of Mineral Resources released a report Tuesday saying the state produced nearly 1 million barrels of crude per day in April, largely from its Bakken shale oil fields.

Fong said Wilz views the agreement as unreasonable because the department can't guarantee the confidentiality of any information provided by the railroad, BNSF, after it is distributed to emergency planners around the state.

"The data that they're releasing [by the railroads] is pretty benign," Fong said. "Any ninny could go to downtown Bismarck and count trains."

Before the emergency order, planners had no information. Now that planners will know the number of trains, "To what extent this is going to impact planning is yet to be seen," Fong said.

"If for some reason, there were a major explosion, there's not a lot you can do about it," she said.

Whether such confidentiality agreements run afoul of Arkansas' Freedom of Information Act is unclear, according to Rob Steinbuch, a law professor at the University of Arkansas at Little Rock's W.H. Bowen School of Law.

Steinbuch said city and state agencies can't enter into agreements that violate the Freedom of Information Act.

"FOIA doesn't speak to confidentiality agreements and is not bound by confidentiality agreements," Steinbuch said. "The state cannot otherwise restrict what the public is entitled to [know] simply because they sign a private agreement with some other party."

While the law does allow the state to protect some proprietary information for competitive reasons, such as a trade secret, that would have to be established, he said. He was unaware of any blanket public-safety provision that might apply.

The emergency order contains penalties of $175,000 for each day a railroad doesn't comply with the new disclosure rule, which only applies to crude oil from the Bakken formation, according to Kevin Thompson, a spokesman for the Federal Railroad Administration.

"That said, the [railroad administration] does not object to railroads reasonably requiring states to sign confidentiality agreements," Thompson said in an email. While the agency plans to "aggressively monitor compliance," it will take into account efforts by the railroads to work with states to provide crude oil shipping information in a timely fashion. He said potential violations will be reviewed on a case-by-case basis.

A Section on 06/18/2014

Print Headline: State seals its lips on oil carrying rail cars


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