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CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014iiiTable of ContentsAbstract...........................................................................................................................................................................1What Is The Issue?........................................................................................................................................................2Freight Transportation Externalities and Assessment of Costs and Benefits....................................................2How Do We Define Risks and Impacts?...................................................................................................................3Modes of Crude Oil Transport in the Great Lakes Basin - Associated Risks and Impacts............................4Pipelines..................................................................................................................................................................4Ships and Barges....................................................................................................................................................6Railroad Transport.................................................................................................................................................8Tanker Trucks.........................................................................................................................................................9Transshipment Sites.............................................................................................................................................10What are the Gaps in Our Knowledge of Risks and Impacts............................................................................12End Notes......................................................................................................................................................................14

2 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014What is the Issue?The surge in crude oil shipments in the U.S posesenvironmental and public safety risks fromaccidents that may occur on pipeline systems, onrailroad lines, on waterways and at transshipmentsites. While some risks of oil transport in the GreatLakes region could be mitigated by constructionof West-to-East and North-to-South pipelines,oil pipelines are long-term projects, expensive toconstruct, and with fixed routes. Railroads, bargesand trucks provide the transportation flexibilitythat oil industry shippers require to respond tochanging trends in productivity at the resourceextraction site and in demand from coastalrefineries. So, although pipeline transport may besafer under some conditions, more flexible transportFigure 1: Yearly Crude Oil Production: Canada &United States 5Figure 2: Yearly Crude Oil Production: Oil Sands &Bakken Shale 6options are preferred for economic reasons. 1, 2 Forexample, while transport by rail is more expensivethan by pipeline, transport time from extractionsites to coastal refineries is reduced from weeks todays. 3 In addition to being economical, shortenedtransit time also reduces the risk of a catastrophicevent since the shipped commodity spends lesstime in storage. However, each transport systemhas distinctive risks and impacts. In addition, theregulatory framework within which each transportnetwork operates further complicates the problemof choice since it affects the way risks and impactsof a particular system are mitigated or addressed.Only a small literature deals with the impact ofregulatory oversight and liability on choices amongtransport systems because the focus is generally onthe more quantifiable aspects such as commodityweight, perishability, and distance. 4Freight TransportationExternalities and Assessment ofCosts and BenefitsAlthough analysis of freight transportation choicesis carried out to assess their relative costs andbenefits, little attention is paid to the externalities,such as environmental risks, created by thetransport choices. The absence of evidence onexternalities further complicates the analysis oftotal costs and benefits (including externalities)and their implications for the transportation choiceprocess.Because transportation is a necessity, considerationof costs without consideration of benefits createsan unrealistic assessment of choices. This is whyassessment of costs and externalities associatedwith particular transportation choices oftenproduces the question: Compared to what? It is inthis realm that strategic choices by shippers andcarriers enter the picture. Transportation decisionsare not solely determined by technology. Theyare driven by the cost and profit options open toshippers and by politically constructed regulatorysystems that provide a framework within whichstrategic transport decisions are made. For thesereasons, the “compared to what?” question is morecomplex than those who pose it may acknowledge.In addition, models of transportation costs andbenefits frequently assume benefits to non-usersbecause efficient transportation may lower the

4 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014Figure 3: Conditions Affecting Oil Spill and Risk Severitythe Great Lakes region is home to some of themost pristine and ecologically sensitive areas inthe world and is considered central to the physicaland cultural heritage of North America. A spill insuch an important and sensitive region can have farreaching consequences. Finally, in addition to theimpacts caused by a spill itself, clean-up techniquescan compound the environmental impacts inecologically sensitive areas.As has already been indicated, transport oftwo types of crude oil is predicted to increasedramatically across the Great Lakes states andprovinces and through the waterways: 1) light crudeshale oil, particularly from North Dakota’s BakkenShale; and 2) exceptionally heavy “tar sands” crudefrom Northern Alberta region, sometimes as dilutedbitumen (dilbit). It is expected that light crudefrom U.S. shale and heavy crude from Canadiantar sands will play a prominent role in commoditytransport in the Great Lakes states and provincesinto the 2020s. 15 In the next sections we examinewhat is known about risks and impacts associatedwith different crude oil transport options.Modes of Crude Oil Transport inthe Great Lakes Basin -Associated Risks and ImpactsPipelinesThe Canadian and United Statespipeline infrastructure has beenresponsible for domestic andinternational transportationof oil for over a century. The44,117 miles of Canadiancrude oil pipeline infrastructure,regulated by National Energy Board, stretchesfrom Vancouver, BC to Montreal, QC in the GreatLakes region. 16 The Canadian pipelines are highlyintegrated with the United States crude oil pipelineinfrastructure, which spans over 57,348 milesincluding in eight of the Great Lakes states. 17 Withinthe Great Lakes region, active crude oil pipelinesextend over 9,122 miles. 18, 19 Although studies showthat, by comparison with other modes of transport,pipelines have a lower incident and fatality rate perbillion ton-miles of oil transported, a pipeline oilspill can have severe and long lasting impacts onthe environment and regional economy. 20The quality of pipeline infrastructure is animportant contributor to oil spill risk in the GreatLakes region. According to the Office of PipelineSafety, much of the pipeline infrastructure has

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 5been in place for decades. 21 In the U.S Great LakesStates, 55% of the pipelines were installed priorto 1970. 22 While it is difficult to deduce the age ofpipeline infrastructure in the Great Lakes Canadianprovinces, the National Energy Board’s statisticsfrom July 2011 show that approximately 48% ofCanadian pipelines carrying hazardous liquids wereinstalled more than 30 years ago. 23 Additionally,incident data collected by PHMSA (Pipeline andHazardous Material Safety Administration, U.SDepartment of Transportation) show that themost common cause of spill incidents is pipelineinfrastructure failure. 24Associated Risks:a) Pipeline Quality: Over time the quality ofpipeline performance declines due to materialdeterioration, cracks from corrosion, erosion anddefective welding. Notable examples are the twoEnbridge pipelines that lie below water to thewest of Mackinac Bridge in Northern Michigan.These pipelines were installed in 1953, over60 years ago, and have never been replaced. 25As noted by a PHMSA report, old pipelinesare prone to corrosion and material and weldfailure. This deterioration accounts for 60% ofpipeline failure and rupture incidents resultingin an oil spill. 26 Similarly, Enbridge Line 9,installed in 1975 and made of carbon steel withwall thickness varying between 6.35 – 9.5 mm,was found to have multiple external cracks onJanuary, 2014. 27 Moreover, studies from NorthDakota, Minnesota, Wisconsin, and Michiganshow that the corrosive effect of dilbit oil causedspills of 38,220 barrels of crude, or 30.3% of thetotal crude oil spill in the United States between28, 292007 and 2010.b) Natural Hazards and Extreme WeatherConditions: Pipelines in the Great Lakes regiontraverse areas subject to damage from ice,currents, floods and lakebed erosion leading tolandslides, which can have detrimental effectson the pipeline infrastructure. 30 Furthermore,the flood maps and information provided byFEMA’s Flood Insurance Rate Maps date backto the 1970’s. 31 The outdated information canlead to increased risk. The lack of contemporaryinformation and data create uncertaintiesregarding the effects of proposed pipelineinfrastructural expansion, particularly the risksassociated with extreme weather conditions.Long-term data from an effective monitoringprogram are, for example, critical to assessingthe risks associated with the proposed expansionof Enbridge pipeline 6B, which crosses overfour rivers at points within 20 miles of LakeMichigan. 32 To cite only one instance, the extremeweather conditions, resulting from ice in wintersand deep surface currents in opposite directionscan create massive clean-up challenges in theevent of an oil spill. 33c) Monitoring: Pipelines require constantmonitoring and accidents may result fromundetected failures due to insufficient ordelayed monitoring. For instance, the NationalWildlife Federation’s underwater dive in 2013highlighted some of the structural defects ofLine 5 that were previously unnoticed. 34 Infuture, if Line 5 starts to transport DilBit, a lapsein monitoring defects could lead to catastrophicaccidents. For example, during the EnbridgeKalamazoo river spill, the pipelines spilled formore than twelve hours before the pipeline wasfinally shut down. 35d) Out-dated Regulatory Regime: Studies showthat more efficient external sensors couldimprove on the performance of current sensors,which have detected only five percent ofpipeline spills in the U.S. 36 However, the existingregulatory framework has failed to effectivelyenforce improved monitoring standards.Moreover U.S. pipeline regulations do notrequire pipeline companies to make public ifthey are transporting bitumen, which may creategreater spill risks. 37 Such disclosure might aidstate and provincial officials in preparing forspills. The inability to provide up-to-date dataand sporadic monitoring lapses may exacerbatethe risks from pipeline spills. While studiesshow that upgrading pipeline infrastructurewith the automatic shut-off valve can reducepotential risks, the current regulations do notenforce such upgrades. 38, 39 Pipeline companiesmay discourage the installation of remote shutoffsystems due to heavy installation costs. 40e) Physical Environment: In the Great Lakes,pipelines traverse diverse ecological areasincluding many locations that are pristine,protected areas that are sensitive to environmentaldegradation, and remote areas that are isolated– where there is a risk of delayed emergencyresponse. Both these conditions contribute to the

6 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014potential risks of pipeline spills.The pipeline safety statistics from 2000-2009reported 411 spill incidents in Canadian pipelinesand 3,318 spill incidents in the U.S. pipelines. 41Within the eight U.S. Great Lakes states, 559hazardous liquid spill incidents between 2004-2010, resulted in property damages of over $1.1billion. 42 Although data from Canada’s NationalEnergy Board (NEB) and U.S. Department ofTransportation (DOT) show that pipelines result infewer oil spill incidents and personal injuries thanroad and rail, the cumulative impact of a spill onthe environment, economy and human health ofthe affected region remains to be examined.Impacts:Across the bi-national Great Lakes region, oilpipelines are often located in close proximityto dense urban as well as ecologically sensitiveareas. As mentioned below, a spill can jeopardizesurrounding neighborhoods, commercial industries,including agriculture, and waterways, resulting insevere immediate and long-term potential impactsas the released product spreads over or penetratesdeep into soil or waterways. In addition to theexisting pipelines, new infrastructural proposalsmay impact the Great Lakes region, which supportsrecreational activities that are vital to the regionaleconomy and nurture an ecosystem that is hometo rare plants and animals. Cases in particular arethe Enbridge Line 6B and Line 9 that create risksfor Lake Michigan and the Ottawa river in Ontariorespectively – both provide important drinking43, 44water supplies.• Ecological: Research indicates that floating oilspills cause death from oil ingestion in aquaticand semi aquatic mammals, and that submergedoil causes abnormalities, including spinaldeformation, eye defects etc., in the newly bornaquatic species. 45 A land spill can degrade thetop-soil or penetrate deep into a local aquifer,impacting the health and economic well being ofthe near-by communities.• Human Health: The diluent in the DilBitevaporates rapidly in the air and can lead to highairborne levels of toxic components. This impactsthe health and safety of the emergency respondersas well as the surrounding communities. 46Moreover, the proximity of pipelines togroundwater sources within the Great LakesRegion can cause serious contamination that canhave a detrimental impact on communities. 47• Economic: In addition to the costs incurred inclean-up activities, an oil spill may negativelyimpact the regional economy. After the Enbridgepipeline Kalamazoo river spill in 2010, somehomeowners in surrounding communities soldtheir homes, fearing a fall in market prices. In2014 local businesses continue to be affected byloss of clientele. Either a water or land spill canresult in significant economic and employmentcosts by putting existing jobs at risk. 48Ships and BargesAbout 70 per cent of the tarsands crude recently extractedin Alberta, Canada was sent torefineries in the MidwesternU.S. 49 However, the surge inAlberta tar sands has increased thetotal quantity of oil transported to refineries inthe U.S. by 53 per cent between 2011 and 2012. 50Although large quantities of crude oil are notbeing transported over the Great Lakes currently,the interconnecting channels of the Great Lakes doprovide favorable conditions for oil shipments infuture. In places such as Hennepin, IL and Albany,NY, barges are used to transport small quantities ofcrude oil as an alternative to rail transport. 51 In theabsence of crude oil shipments through the Greatlakes, an analysis of recent hazardous liquid spilldata from commercial vessel shipping on the GreatLakes can point to some of the associated risks.Studies show that ships and barges pose fewer risksin transporting hazardous liquids than trains andtrucks, and have economic advantages over othermodes of transport. 52, 53, 54 However the possibilityof an oil spill, particularly of tar sands crude oil,in open waters or inland-restricted waters posesrisks with potential long lasting impacts on theenvironment and the economy. 55Associated Risks:a) Collisions: A barge or tanker ship hull containingcrude oil can suffer severe structural damageas the result of a collision with another ship,resulting in an oil spill. The latest regulations by

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 7Transport Canada require all tankers, small andlarge, to be double-hulled by 2015. 56 Similarly,in the United States, under the Oil Pollution Act(OPA) of 1990, double-hulled tankers will replacethe double bottom and double side vessels by2015. 57 According to Coast Guard data, there arecurrently 10 domestic ships transporting oil andfinished petroleum over the Great Lakes andmost of these have met the OPA requirements. 58The Galveston Bay (Texas) oil spill shows that,while structurally safer, the double-hulled shipsand barges do not provide complete protectionin the event of high impact collisions. 59 Moreover,depending on the type of oil in the vessel, theimpact resulting from collision may cause fireand explosion. 60b) Spill Spreading in Connecting Channels: Manyof the refineries, oil storage facilities and portslie along the connecting channels and tributariesof the Great Lakes. 61 Water currents and climaticconditions pose a risk of spreading the spill intothe adjacent watershed, which can complicate acomprehensive response.c) Regulatory Risks and Human Error: A specialrisk arises from the nature of ship and bargeoperations, which might not be addressed byexisting regulatory measures. For instance,ship and barge traffic does not have set routesand intersections as compared to railroads ortrucks. The seaway traffic needs to be controlledpartly by remote dispatchers, which increasesthe risk of human error leading to an accident– an important risk in the advent of increasingoil shipments over the Great Lakes. In addition,the current regulations may compound the riskssince they rarely require the vessel operatorsor harbor personnel to be aware of up-to-dateemergency procedures in the event of a spill. 62Impacts:Spilled oil weathers quickly, breaking down andchanging its physical and chemical properties.In this process, the oil can have impacts on floraand fauna of the Great Lakes depending on theirsensitivity to oil contamination. Such impacts aredifficult to measure and can complicate the responseprocess. In addition, depending on the type of oil,the impacts can have different repercussions for theenvironment, health and economy.• In Open Water: In tar sands crude spills, thediluent hydrocarbon (eg. Benzene) floats on thesurface of the water. The ingestion and inhalationof the resulting toxic fumes can endanger seabirdsand mammals. Furthermore, since tar sands crudeoil is heavier than water, it can sink to bottomof the lake or river bed making the extractionprocess resource intensive and, in a few cases,impossible. 63 Similarly, the Bakken light crude oilhas a high proportion of hydrocarbons that makeit viscous and explosive at the same time. Owingto its high volatility, a Bakken oil spill couldresult in a fire or explosion. More importantly,a spill in open water (and shoreline) can affectthe approximately 26 million people living inthe Great Lakes basin who depend on the GreatLakes for their drinking water. 64• At Shoreline: Apart from impacting the floraand fauna, the arrival of oil at the shoreline canbe detrimental to the environment as well as tohuman coastal activities. The washed away oilthat reaches coastal wetlands and beaches canseverely impact commercial and sport fishingactivity - an important industry of the Great Lakes– and other commercial industries dependent onGreat Lakes water usage for industrial purposes. 65• Economic: The commercial fishing industry,including fishermen and suppliers of marinerelatedproduce, can be damaged in an event ofan oil spill. Simultaneously, small and mediumbusinesses (especially tourism businesses) incurheavy losses due to cordoned off waterways. Afterthe clean up, these industries incur additionalexpenses to retrieve lost clientele. 66 The GreatLakes waterway system is a critical trade andindustry corridor. The increased use of ships andbarges to transport Alberta tar sands crude mayalso “crowd out” existing commercial cargo suchas coal, limestone, grain, newsprint, and cement,raising prices in the industries they supply. 67Shipments of crude oil via trains have alreadybegun to crowd out commodity shipments toNorth-West ports, and ship and barge transportcould potentially follow a similar path. 68

8 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014Railroad TransportAccording to the Association ofAmerican Railroads, 434,000carloads of crude oil moved byrail across United States in 2013,roughly 45 times the amountshipped in 2008, and the volumescontinue to rise. 69 The reason that oil shipping byrail has expanded is the ability of rail to quicklyrespond to increasing resource extraction. Inaddition, railroads are willing to enter into shortertermcontracts with shippers (oil companies), whichfurther adds to their flexibility in a constantlychanging oil market. 70 However, the increasedvolume of transport has also led to a surge in oil spillincidents. Over the period of 1996-2007, railroadsconsistently spilled less crude oil per ton-mile thaneither trucks or pipes. However, in 2013 alone, thetotal gallons of oil spilled by rail were more thanthe combined total from 1975-2012. 71, 72 The recentdisastrous events – Lac-Mégantic QC, CasseltonND, Aliceville AL, Lynchburg VA. – and the growthin projections in volume of oil transport by rail haveraised serious safety and environmental concernsabout the transport of crude oil by rail. 73 Owing tothese increasing incidents, rail transportation ofcrude oil has received more public and regulatoryscrutiny in the U.S. and Canada.Associated Risks:a) Infrastructure: Studies of Federal RailroadAdministration data show that 60% ofthe freight-train accidents are caused byderailments. 74 Research also shows that themajor causes of derailment are broken rails orwelds, buckled track, obstruction and main-linebrake operation – one of the reasons for the LacMégantic derailment incident that resulted in acatastrophic fire and explosion was the failureof brakes. 75 Other similar derailment incidents,such as that in Aliceville Alabama point to failureof trestles, which are antiquated and have notbeen adequately maintained – It should be notedthat this accident remains under investigation--an official NTSB report on the incident was notproduced when this policy brief was written. 76In addition, factors like abnormal train speed,weather conditions and human-error cancontribute to oil spill incidents.b) Tank Car Design: The DOT-111/Class 111 tankcar is most frequently used to ship crude oil inthe US and Canada. Several problems have beenidentified with this tank car model. These tankcars are prone to structural failure and ruptureupon impact. Studies from TSB and NTSB showthat the DOT-111/Class 111 car’s wall thickness(7/16 inch) might not be sufficient to withstandimpact during an accident. 77 The top-fittings,used for loading and unloading of content, mayburst open in a derailment or rollover. The headshields, at the front of the cars, are prone topuncture in a collision. The three bottom valves,facilitating quick unloading at the terminals,break easily on impact, thus releasing the oil.Out of the 63 oil-filled tanker cars that derailedin Lac-Megantic, 60 (95%) cars spilled oil due totank car damage – puncture of shell and front/rear heads were identified as the major causes. 78c) Crossings: Unmonitored crossing pointsare special risk zones where accidents withautomobiles, vans, trucks and buses can increasethe risk of oil spill or explosion. With the adventof unit trains, which are frequently over a mile inlength, drivers may be tempted to run throughclosed crossings. Monitoring of crossings,including illegal trespassing, and installation ofproper infrastructure are the responsibility oflocal law enforcement officials who do not havethe manpower to monitor crossings in denselytrafficked urban areas. For example, the recentaccident between a truck and an empty oiltanker in West Nyack, NY that led to fire andexplosion, points to lack of infrastructure (safetygate system) and lack of monitoring. 79d) Mixed and Unit Trains: Unit or block trains carryone commodity in multiple tank cars. Unit trainsmay contain between 120 and 140 tank cars andare typically over a mile long. The volume ofoil carried in unit trains poses particular risksbecause a derailment may result in fire andexplosion that can spread to non-derailed tankcars. While volume carried is less concern inmixed trains, the lack of complete informationabout commodity contained in the tanker canincrease risks since operators may change thesequencing of cars during the rail journey. 80 Therisks are further heightened if the emergencyprocedures being adopted in the US and Canadafocus exclusively on unit trains. Mixed trains

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 9carrying crude oil are not adequately studiedin risk analysis and emergency preparednessprograms that address crude oil transport.e) Train Assembly: Research shows thatimproperly assembled trains are moresusceptible to derailment. 81 The distribution ofcars that are empty or loaded and short or longaffects the train’s ability to negotiate track routeswhile subjected to ‘stretching’ and ‘compressive’forces that may result in derailment. In additionto train assembly, other factors like track gradesand turning radius affect train maneuverability,and may result in derailment.f) Regulatory Regime: In the U.S., regulationsrequire that railroads have either a ‘basic’response plan or a more ‘comprehensive’response plan, depending on the volumecapacity of the rail car transporting the oil.In 1996 the Federal Railroad Administration(FRA) set the threshold differentiating theresponse plans at 1,000 barrels, thus deterringthe applicability of a comprehensive responseto incidents caused by new DOT-111 cars thatcarry around 700 barrels. 82 Proper classificationof trains hauling crude oil is critical because itensures that hazardous materials are placed inthe appropriate tank cars and that emergencyresponders will know the right protocols tofollow in the event of an accident. 83 Howeversuch regulations do not ensure the safety of amanifest train, where cargo gets loaded andunloaded at different transshipment sites.g) Human Capital Planning: In the quicklychanging scenario of oil transportation, localagencies might find it difficult to recruit,train and allocate new employees to meetdramatically increased volumes of crude oiltransport and associated risks. The FRA (FederalRailroad Administration) is facing strategichuman capital planning challenges to cope withincrease traffic flow, new technologies and newregulations – a risk that is applicable to all themodes of transport. 84An important issue that remains to be investigatedis train speeds and corresponding dwell time –the amount of time a train spends between itsdestinations. Data from the Association of AmericanRailroads (AAR) show that between 2013-2014 thedwell times remained 25% above the previousaverage time, while the average train speeds were12% slower than during the same period in 2013. 85Reducing dwell time and increasing train speedwould reduce the total time that oil trains spendin populated areas. However, whether changingthis ratio will reduce the probability of accidents,requires further research.Impacts:The US Federal Railroad Administrationapprovedtracks that carry crude oil shipmentsoften run in close proximity to dense urban areas,environmentally sensitive areas and importantbodies of water, including the Great Lakes. Witha potential risk of fire and explosion, an oil spillcould have a severe and long lasting impact on aregional economy.• Environment: An oil spill into bodies of waterand on land surfaces can have detrimental effectson the environment as well as human activities.The most dangerous impact, specific to railwayincidents, is the release of hydrocarbons andother toxic materials during an explosion that cancontaminate the air.• Human Health: Apart from air contaminationcausing respiratory disorders in surroundingcommunities, the biggest threat is that to humanlife if a fire and blast occurs. 86• Economic: In the event of a catastrophe, therailroad companies have insufficient insurancecoverage to pay for accident damages. Damagesmay require public investment to rebuild lives,fund soil or water remediation and reconstructthe local economy. 87 Furthermore, an explosioncan inflict severe property damage that candisrupt communities and neighborhoods.Tanker TrucksTanker trucks provide flexibility,linking extraction sites andrefineries to pipelines and railterminals. As compared to othermodes of transport, trucks areprimarily used to transport oil forrelatively short distances because long distancetransport by truck is not an economical option. 88Although trucks transport only a small percentageof the total oil being moved in the U.S. and Canada,and an even smaller percentage in the Great Lakesregion, the increase in truck oil shipments can be a

10 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014cause of concern. The truck oil shipment from shaleformations in North Dakota and tar sands in Canadato U.S. refineries increased by 38% between 2011and 2012. 89 The existing studies on truck transportindicate that trucks are not a favored mode oftransport due to high incident rates per billionton-mile when compared to rail, ships/barge andpipeline. 90, 91 However the surge in production canchange the transportation trends. In the absence ofstudies on tanker trucks carrying crude oil, studiesof trucks hauling hazardous liquids can point tosome of the associated risks and impacts.Associated Risks:a) En route collision: As compared to othermodes of transport, tanker trucks operate inclose proximity to the general public and sharethe same infrastructure – highways, roads,neighborhoods etc. This increases the risk ofaccidents, including collisions and accidents atcrossings, during the course of their journey.Since a collision can involve vehicles traveling athigh speed, the chances of fire and explosion arehigher. 92b) Inadequate Infrastructure: Since trucks areoften used to transport oil to and from railwaytransshipment sites and pipelines, poorlymaintained and monitored infrastructure atdelivery points and fuel loading terminalscould contribute to accidents, including fire andexplosion. 93c) Truck Design: While loading the oil through thebottom lines of the tanker trucks, the lines do notdrain completely into the main tanks becausethey are at the lowest point. The structurallyfragile bottom lines can contain more than 50gallons of the hazardous liquid, referred toas ‘wetlines’, and may contribute to an eventleading to fire and explosion. 94d) Regulatory Regime: A significant risk emergesfrom lack of information – for example, the U.S.Department of Transportation does not trackthe total number of cargo tank trucks operatingwithin United States. 95Impacts:Although tanker trucks account for only 4 percentof the total crude oil and petroleum transport, thehigh incident and fatality rates in comparison withother modes of transport, create a higher probabilityfor a catastrophic event every time a tanker truck ison the road. 96• Environment: Previous experiences with truckrelatedoil spills indicate that the biggest threatto the environment is the contamination of activewater streams whose water is used for householdand industrial purposes. 97 Additionally, similarto aforementioned land and water spill impacts,the after effects of a spill can be felt on flora andfauna and on human activities.• Human Health: Apart from the threat of aircontamination, an oil spill can cause fire andexplosion resulting in serious injuries and/orfatalities and loss of property. 98• Economic: An oil spill causing fire and explosioncan inflict property damages that can have along lasting impact on the housing prices of thearea. Moreover, a cordoned off highway and/orclosure to important business routes can affectbusinesses in the area.Transshipment SitesThe surge in crude oil productionfrom the Western US andCanada is changing the waysin which oil is moved in bothcountries and the geography ofoil transport lines, networks, andnodes. Transshipment sites are beingexpanded in some instances and new ones created.These include truck transfer sites at the point ofextraction to connect with pipelines; loading andoff-loading sites at rail spurs and in rail yards; andtransfer and storage sites at refineries and ports.One example of this industrial transformationis at the Port of Duluth-Superior at the border ofMinnesota and Wisconsin. A corporation that ownsa refinery at the port is repairing a shipping dockand has proposed to build an oil terminal at theport. These new facilities and the risks they poseare based on estimates of 35,000 barrels of crude oilfrom Canada being shipped across the Great Lakesas soon as 2015. 99While some Great Lakes transshipment sitesare becoming more important because of theirproximity to booming oil fields or other geographicadvantages, some transshipment sites and theirfacilities are less economically viable because theyare linked to older and now declining sources ofresource extraction. This is an inherent feature

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 11of the boom-bust cycle of resource extractionbasedeconomies. To cope with uncertainties,oil companies use multiple modes of transportto link key production sites and refineries. Theyalso utilize make-shift facilities, as has happenedin North Dakota, to provide immediate services.These temporary facilities are likely to create morerisks than those that have been planned carefullyand vetted by regulators. 100As the Bakken shale oil production and Albertatar sands oil production intensify, so will thetransshipment and trans-loading infrastructurein the Great Lakes states and provinces. TheBakken Oil Express rail terminal in North Dakota,constructed in 2011, receives oil from two pipelineswith 22 truck loading bays and 55,000 feet of railloading. 101 In the US Great Lakes states, recentinformation suggests that Canadian Pacific railwayhas five and the BNSF railway has nine crude oiltrans-loading facilities that can potentially increasetheir operating capacity to meet the rising demandof crude oil transportation. 102, 103 To add to theseare the 15 major ports and 50 smaller regionalports along the Great Lakes-St. Lawrence Seawayregion that are at risk from oil spills and 75 active104, 105ports on U.S side and 29 on the Canadian side.Smaller inland ports may also pose indirect risksto the Great Lakes, should they choose to ship oilas a commodity. The Wood River, Illinois port, forexample, off-loads 40,000 barrels per day of heavyCanadian crude from pipelines onto barges, whichcreates the risk of a spill incident. 106The anticipated growth of crude oil shipping willrequire more and more efficient transfer facilitiesthat can handle the increased flow of traffic. Boththe design and monitoring of these facilities toreduce risks remain open questions.Associated Risks:a) Human Error: The most common risks associatedwith transshipment points are the technicalfailure and defects of equipment such as an oilloader at a barge and truck-loading terminalthat can cause oil to spill. 107 Past studies attributethe majority of failures to human errors whileoperating loading equipment at a terminal,however an updated study of the Great Lakesregion is required that points to more preciserisks. 108 In addition, as mentioned earlier, shipsand barges have limited fixed routes and aremaneuvered by local dispatchers. This increasesthe chance of human error that can result inindustrial accidents, causing fire and explosionduring docking, or collision between incomingand outgoing tankers.b) Storage and Maintenance: Cargo shipmentsmay stay docked for days at transshipmentpoints before being transferred to other modesof transport and they may not be monitored forleakage and/or accidental damages. – a case inparticular is the incident at the Port of Albanywhere 100 gallons of oil was spilled from astored rail car because of a pressure releasevalve. 109 To respond to the increasing supply ofoil, transshipment sites have begun to increasetheir oil storage capacity, which further increasesthe risk. 110c) Regulatory Regime: The vast majority of GreatLakes ports are not managed by a single entity.On the U.S side, the majority of the docks areprivately owned and located around federallymaintainednavigation channels. The control ofproperty and operations lies with the privateentity. In rare cases, especially major cities, portsare managed by local public agencies while thedocks are privately owned. In these instances, thecontrol of docks lies with private entities, and inpart with local public agencies. Similarly, federalport authorities, provincial governments andmunicipal governments manage the ports, whileprivate companies own the docks in Canadianprovinces. 111 The ambiguous issue of control andownership can complicate the risk governanceprocess. As with other transport risks “arenas”,transshipment sites are affected by the absenceof current information on the potential risksthey face; risks that may be exacerbated by anincrease in the volume of oil they are handling.For example, outdated coastal flood maps mayunderestimate a variety of dangers to Great Lakescarriers. The Great Lakes region experiences lakelevel changes, coastal flooding, long and shorttime soil erosion and storm surges among otherhazards. 112 These hazards can potentially causephysical damage to the port infrastructure thatcan then lead to a catastrophic event.The existing literature on crude oil transportationfocuses almost exclusively on the modes oftransportation and overlooks the substantial risks

12 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014of transshipment points in the U.S. and Canada.A comprehensive understanding of risks andimpacts of transshipment ports can help to managethese critical points and reduce the possibility ofcatastrophic accidents.Impacts:The impacts of an incident at a transshipmentpoint are similar to the aforementioned shoreline,land and open water spill. Similar to these risks,the most distinctive impact at a transshipmentpoint comes from unmonitored docked cargos thatcan turn from a small oil spill into a catastrophicevent. Furthermore, unclear accountability for thedocked cargo, between docking and unloading, cancomplicate or delay an oil spill response.• Economic: A spill or a catastrophic event attransshipment point renders it dysfunctionalfor days. The impact can be felt by commercialfreight as well as the tourism industry, which canaffect the regional and national economy. 113• Proximity to population: A transshipment site,such as a port, rail yard, or refinery may beadjacent to a residential neighborhood. In theevent of an accident, this residential area may beat serious risk from fire or explosion.What are the Gaps in OurKnowledge of Risks and Impacts?This report provides evidence that all the modes ofcrude oil transport through the bi-national GreatLakes basin pose risks that depend on a numberof factors – the type of crude oil being transported,population density, ecological vulnerability,emergency preparedness in the region, and climateand weather conditions. The resulting impacts mayhave complex consequences for the environment,human health and economy of the region. Bothcomplex risks and impacts make it difficult toformulate a comprehensive oil spill response.Our understanding of risks and impacts is limitedby what we know from the accidents that havehappened thus far. Although some of the literaturereviewed in this report recommends one mode oftransport over the other, the conclusions are basedon partial data and evidence and rarely reflectthe rapidly changing physical, regulatory, andeconomic environment of crude oil transport inthe Great Lakes region. With the surge in crude oiltransportation, there are important issues that needto be addressed to develop a more comprehensiveresponse to reduce the risks of spills• Relative Risk Analysis: The most important stepis to develop a more complete analysis of relativerisks and impacts that systematically considersall the factors for each mode of transport –economic consequences, incident rates, fatalityrates, potential long-run environmental damages,etc. Such scenario-based research could focus onthe distinctive risks and impacts for each mode oftransport.• Regulatory Gaps and Risk Governance:Governance can affect the way that risks aremanaged and impacts are mitigated. This reportpoints to some of the obvious gaps in the existingregulatory regimes. However, there are othergaps that have not yet been fully addressed.For instance, the issue of liability is not fullyaddressed by the market or by regulators. In thecase of rail transport, the shipping and carryingcompanies are often under-insured and thecosts of accident remediation clearly exceed theinsurance coverage available in the commercialmarket. 114 Although shared liability, where thegovernment bears the costs over and above thecap established by commercial insurance, seemsa possible solution, using public money to coverrisks created by transport of a highly profitablecommodity necessarily attracts public scrutiny.The issue is further complicated by the ambiguityof liability when the oil is in transit. An approachsuch as diverting severance tax from generalstate revenues to a dedicated environmentand community restoration fund for futurecompensation, may be a more effective way to115, 116mitigate potential impacts.• Emergency Capacity: Some local governmentslack professional emergency responders andmust rely on volunteer fire fighting teams duringa catastrophic incident. Reliance on volunteersto address major industrial accidents jeopardizesthe lives of citizens and precludes an effectiverisk mitigation strategy. To meet the challengesof crude oil transportation, the Great Lakes statesand provinces and their respective nationalgovernments should update the informationthat underpins their regulatory regimes. Already

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 13accepted regulatory regimes, such as thatgoverning airline safety, can provide effectiveworking models that can be used to evaluate thesafety and response mechanisms for the variousmodes of transport that ship crude oil.• Emergency Preparedness for Major Accidents:Emergency preparedness for minor incidents,although useful, may not provide adequatepreparation for major incidents with catastrophicconsequences – low probability high impactincidents. Preparedness has been complicated bylack of communication between shippers, carriers,and local emergency responders. 117 Studies ofrisk management and emergency preparednessindicate that there is a general tendency tounder prepare for catastrophic accidents. Thispreparation is costly and may alarm the public.The alternative course to approach risk anduncertainty is to build a risk management systemthat reduces risks of high-cost incidents. 118 Theregulatory practices by the U.S. Federal AviationAdministration and U.S. Coast Guard can beuseful case studies in this process – for example,the Coast Guard already has 29 planned oil-spillresponse exercises in the Great Lakes region. 119• The Impact of Different Types of Oil: Onecontentious topic that emerges out of the currentdiscussion concerns oil characteristics and itsimplications for transportation infrastructure.For instance, while research indicates that raw tarsands products have higher sulfur content thanmedium and light crude oils and can contributeto corrosiveness, other research suggests thattar sands products in their transported state areno more corrosive than standard crude oil. 120Similarly, there has been research arguing for andagainst the explosive characteristics of Bakkencrude oil and its impact on transportation modesand vessels. 121 Studies of oil characteristics,particular to the mode of transport currentlyused, can help inform the decision process.• Land Use Planning in the Great Lakes Region:The Great Lakes land use planning happens ata local level of government – town, city etc. – sothe federal government cannot effectively controlthis aspect of development. 122 Local land useplans often do not consider the broader impactof oil transport on the surrounding area andnearby communities. In the wake of increasingoil infrastructure, and with little or no regionalanalysis in local land use plans, there is a risk ofunplanned development that could negativelyaffect the environment of the Great Lakes region.This report summarizes some of the key risks andimpacts for the Great Lakes states and provincesemerging from a dramatic increase in demand forthe transport of crude oil. With rapid expansionof crude oil production in Canada and the US, oilshippers are utilizing the Great Lakes transportationinfrastructure to get their product to East coastrefineries and into global markets. All segments ofthis critical transport infrastructure, including rail,tanker ships, and pipelines, are affected along withthe ports and sites where the oil is moved from onetype of transport to another. The rising demand forcrude oil transportation has challenged the responsemechanisms and governance frameworks of publicand private institutions that provide monitoring,safety regulations and emergency preparedness.The ability to address the risks created by crude oiltransport in the Great Lakes has also been affectedby fragmented responsibility and limited capacity.The risk and impact information in this initial reportis intended to contribute to evolving discussionsabout how monitoring, safety regulation andemergency preparedness can be brought up-tospeedto insure public safety and the protection ofcritical environmental resources in the Great Lakesregion.

14 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014End Notes1John Frittelli et al., US Rail Transportation of Crude Oil:Background and Issues for Congress (Congressional ResearchService, 2014), 4.2Pick Your Poison For Crude – Pipeline, Rail, Truck or Boat,Forbes 2014, accessed July 27, 2014,http://www.forbes.com/sites/jamesconca/2014/04/26/pickyour-poison-for-crude-pipeline-rail-truck-or-boat/3Frittelli et al., US Rail Transportation of Crude Oil, 7. Movingoil by train from North Dakota to the Gulf Coast or AtlanticCoast requires about 5 to 7 days’ transit, versus about 40days for oil moving by pipeline, reducing producers’ need forworking capital to cover the cost of oil in transit.4David Keeling, Transportation geography: new directionson well-worn trails, Progress in Human Geography (SagePublication, 2007), vol 31., 217.5Annual growth projection data for United Stated andCanada retrieved from Energy Information Administrationand Canadian Association Of Petroleum Producers (CAPP)respectively.6North Dakota Field Production data retrieved from EnergyInformation Administration and Alberta Oil Sands dataretrived from Canadian Association Of Petroleum Producers(CAPP).7David Green and Donal Jones, “The Full Costs and Benefitsof Transportation: Conceptual and Theoretical Issues”, inThe Full Cost and Benefits of Transportation (Berlin: Springer-Verlag, 2007), 1-268Anthony Swift et al., Tar Sands Pipelines Safety Risks (NaturalResource Defense Council, National Wildlife Federation,Pipeline Safety Trust, Sierra Club, 2011),3.9Operation Safe Delivery Update (PHMSA, 2014), 16.10America’s Gulf Coast: A Long Term Recovery Plan after theDeepwater Horizon Oil Spill (Restore Gulf Coast, 2010), 1.11Assessing the Long-term Effects of the BP Deepwater HorizonOil Spill on Marine Mammals in Gulf of Mexico (MaritimeMammal Commission, 2011), 10. The report states that ExxonValdez oil spill’s (1989) long-terms effects were felt 15 yearsor more after the spill.12Great Lakes Monitoring, U.S Environmental ProtectionAgency, accessed July 24, 2014,http://www.epa.gov/glnpo/monitoring/great_minds_great_lakes/social_studies/without.html13Land and Shoreline Uses, U.S Environmental ProtectionAgency, accessed July 24, 2014,http://www.epa.gov/greatlakes/atlas/gl-fact2.html14Consumptive Water Use in the Great Lakes Basin, U.S.Geology Survey 2008, accessed July 24, 2014,http://pubs.usgs.gov/fs/2008/3032/pdf/fs2008-3032.pdf15Welch, et al., Oil and Water,1-3.16“How extensive is Canada’s pipeline system?”, NationalResource Canada, 2013, accessed July 21, 2014,http://www.nrcan.gc.ca/energy/infrastructure/5893#h-1-3.17“Annual Report Mileage For Hazardous Liquid or CarbonDioxide System 2014”, Pipeline and Hazard Materials SafetyAdministration, accessed July 21, 2014,http://www.phmsa.dot.gov/portal/site/PHMSA/menuitem.6f23687cf7b00b0f22e4c6962d9c8789/?vgnextoid=d731f5448a359310VgnVCM1000001ecb7898RCRD&vgnextchannel=3430fb649a2dc110VgnVCM1000009ed07898RCRD&vgnextfmt=print.18EIA GIS database, accessed July 20, 2014, http://www.eia.gov/state/notes-sources.cfm.19Data and Statistics for each individual U.S. states can befound at Pipeline and Hazard Materials Safety Administration,accessed July 21, 2014, http://primis.phmsa.dot.gov/comm/reports/safety/WI_detail1.html?nocache=2566#_OuterPanel_tab_5.20Diana Furchtgott-Roth and Kenneth Green, Intermodal Safetyin the Transport of Oil. Studies In Energy Transportation.(Fraser Institute, 2013).21Office of Pipeline Safety, Building Safe Communities: PipelineRisk and its Application to Local Development Decisions (U.S.Department of Transportation, 2010), 5. The article states thatat least 55% of currently operating hazardous liquid pipelinesin the U.S were installed before 1970 and at least 71% wereinstalled before 1980.22Data on age of pipelines for U.S. states can be found atPipeline and Hazard Materials Safety Administration database,accessed July 21, 2014, http://opsweb.phmsa.dot.gov/pipeline_replacement/by_decade_installation.asp232011 December Report of the Commissioner and theEnvironment and Sustainable Development (Officer of AuditorGeneral of Canada, 2011), Exhibit 1.5, accessed August15, 2014, http://www.oag-bvg.gc.ca/internet/English/parl_cesd_201112_01_e_36029.html#ex5.24The State of The National Pipeline Infrastructure, Secretary’sInfrastructure Report (U.S. Department of Transportation,2011), 3.25Jess Alexander and Beth Wallace, Sunken Hazard: Aging OilPipelines Beneath The Straits of Mackinac An Ever-PresentThreat To The Great Lakes, (National Wildlife Federation,2012), 2-5.26The State of The National Pipeline Infrastructure, 2-4.27Line 9B Reversal And Line 9 Capacity Expansion Project:Pipeline Integrity Engineering Assessment (Enbridge PipelinesIc. Pipeline Integrity Department, 2012), 51-61.28Lara Skinner and Sean Sweeney, The Impact of Tar SandsPipeline Spills On Employment and The Economy (GlobalLabor Institute, Cornell University, 2010), 4.

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 1529Swift et al., Tar Sands Pipelines, 6.30“Great Lakes Coastal Resilience Planning Guide”, GreatLakes Coastal Resilience, accessed July 23, 2014, http://www.greatlakesresilience.org/climate-environment/climate-naturalprocesses#bluff-erosion.31“Great Lakes Coastal Flood Study”, Great Lakes Coast,accessed July 23, 2014, http://www.greatlakescoast.org/great-lakes-coastal-analysis-and-mapping/.32“Little Oversight for Enbridge Pipeline Route that Skirts LakeMichigan”, Inside Climate News 2014, accessed July 23,2014, http://insideclimatenews.org/news/20121002/enbridge-6b-pipeline-michigan-grassroots-landowners-eminentdomain.33Alexander and Wallace, Sunken Hazards, 4.34“Concerns Mount About 61-year Old Enbridge Pipeline inthe Great Lakes”, DESMOGCANADA 2014, accessed July 21,2014, http://desmog.ca/2014/03/06/concerns-mount-about-61-year-old-enbridge-pipeline-great-lakes.35Swift et al., Tar Sands Pipelines, 7.36“Little Oversight for Enbridge Pipeline Route that Skirts LakeMichigan”, Inside Climate News 2014, accessed July 23,2014, http://insideclimatenews.org/news/20121227/indianaenbridge-pipeline-6B-lake-michigan-rivers-dilbit-oil-spillwetlands.37“Concerns Mount About 61-year Old Enbridge Pipeline inthe Great Lakes”, DESMOGCANADA 2014, accessed July 21,2014, http://desmog.ca/2014/03/06/concerns-mount-about-61-year-old-enbridge-pipeline-great-lakes.38Paul Parfomak, Keeping America’s Pipelines Safe andSecure: Key Issues for Congress (Congressional ResearchService, 2013), 21. Although the report points at natural gastransmission pipelines, similar technology can also be installedfor oil pipelines that can reduce the risks.39Studies for the Requirements of Automatic and RemotelyControlled Shutoff Valves on Hazardous Liquids and NaturalGas Pipelines with Respect t Public and Environmental Safety(Oak Ridge National Laboratory, 2012), 182-185.40“Safety Valve Was Skipped”, The Wall Street Journal,accessed August 16, 2014, http://online.wsj.com/news/articles/SB1000142405274870450600457617432221051322841Focus on Safety and Environment: A Comparative Analysisof Pipeline Performance – 2000-2009 (Nation Energy Board,2011), accessed July 24, 2014, http://www.neb-one.gc.ca/clf-nsi/rsftyndthnvrnmnt/sfty/sftyprfrmncndctr/fcsnsfty/2011/fcsnsfty2000_2009-eng.html#s2_542Data and Statistics for hazard liquid incidents for eachindividual U.S. states can be found at Pipeline and HazardMaterials Safety Administration database, accessed July 23,2014, http://primis.phmsa.dot.gov/comm/reports/safety/NY_detail1.html?nocache=5332#_AllPanelliquid44Economics of Transporting and Processing Tar Sands Crudesin Quebec (Goodman Group, LTD 2014), 8.45Shanese Crosby et al., Transporting Alberta Oil SandsProducts: Defining the Issues and Assessing the Risks,NOAA Technical Memorandum NOS OR&R43 (Seattle,WA:Emergency Response Division, 2013), 63-65. The report usesthe example of Athabasca River. Although not directly oil spillrelated, the study investigates the impacts of toxic materialsin the oil sands on aquatic and semi aquatic species.46Jessica Winter and Robert Haddad, “Ecological Impacts ofDilbit Spills: Consideration for Natural Resource DamageAssessment” (paper presented at 37th AMOP TechnicalSeminar on Environmental Contamination and Response,Alberta, Canada, June 3-5, 2014), 5. The authors state thatdue to high evaporation rate of diluents of DilBits in the2010 Kalamazoo River spill, respirators were required for allpersonnel in the area of the pipeline break, and residentsof nearby homes were evacuated. The NOAA 2013 report(op cit.) also claims that the responders reported elevatedlevels of benzene in the air relative to those recorded at spillsof standard crude oils and that 11 responders and manyresidents reported having headaches, nausea, and respiratoryissues.47Skinner and Sweeney, Impact of Tar Sands, 7. The reportstates a claim by Dr. Stansbudy (University of Nebraska) thata worst-case spill of the proposed Keystone XL pipeline thatcrosses 1,748 bodies of water, can pose serious health risksto people using that groundwater for drinking water andirrigation.48Skinner and Sweeney, Impact of Tar Sands, 5-10.49Welch, et al., Oil and Water, 2.50Maude Barlow, Liquid Pipeline: Extreme energy’s threat tothe Great lakes and the St. Lawrence River (The council ofCanadians, 2014), 10.51Frittelli et al., US Rail Transportation of Crude Oil, 7.52Welch, et al., Oil and Water, 7-8. According to Coast Guarddata, the average annual spill for commercial vessels from2003-07 was approximately 3,157 gallons (60 events), andthe average annual spill from 2008-12 was approximately 10gallons (50 events).53“With Production on the rise, oil by barge traffic sets offgreater safety concerns”, Alberta Oil Magazine 2014,accessed July 25, 2014, http://www.albertaoilmagazine.com/2014/06/athabasca-mississippi-oil-by-barge/. The cost oftransporting crude oil through barge is $0.72 per ton-mile, ascompared to $2.24 per ton-mile for equivalent rail capacity.Truck transportation, for the same capacity, is 37 times moreexpensive54Environmental and Social Impacts of Maritime Transport inthe Great Lakes – St. Lawrence Seaway Region (ResearchTraffic Group, 2013), 7.43Alexander and Wallace, Sunken Hazard, 6-10.

16 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 201455Welch, et al., Oil and Water, 7-8. According to Coast Guarddata, the average annual spill for commercial vessels from2003-07 was approximately 3,157 gallons (60 events), andthe average annual spill from 2008-12 was approximately 10gallons (50 events).56Moving Energy Safely: A Study of the Safe Transport ofHydrocarbons by Pipelines, Tankers and Railcars in Canada(Standing Senate Committee on Energy, the Environment andNatural Resource, 2013), 24.57Oil Pollution Act of 1990, (U.S DOT 1990), accessed July 29,2014,https://www.federalregister.gov/articles/2000/06/23/00-15955/oil-pollution-act-of-1990-phase-out-requirements-for-single-hulltank-vessels58Welch, et al., Oil and Water, 6.59“Galveston Bay Oil Spill Leaves Hundreds of Birds Oiled”,The Texas Tribune, accessed July 5, 2014, http://www.texastribune.org/2014/04/04/shorebirds-devastated-galvestonoil-spill/.Miss Susan, a barge, carrying almost a million gallonsof heavy oil collided with a commercial ship. The barge is nowpartially sunk in the channel. One of four tanks on the bargewas damaged and started leaking. The oil is now movingfrom Galveston Bay into the Gulf of Mexico.60Welch, et al., Oil and Water, 7-8. In January 2005, a largeexplosion aboard Egan Marine Corporation’s tank barge,EMC-423, discharged about 84,000 gallons of crude oil intothe Chicago Sanitary and Ship canal.61Emergency Preparedness And Response Programs For Oil andHazardous Materials Spill: Challenges and Priorities For TheGreat Lakes – St. Lawrence River (Great Lakes Commission,2012), 21.62Challenges and Priorities For The Great Lakes – St. LawrenceRiver, 19.63Welch, et al., Oil and Water, 4. Based on the lessons learntfrom Kalamazoo River spill in 2010, the authors claim thatextracting of one barrel of tar sands oil removes four tons ofsand and soil and three barrels of water in the process.64Great Lakes Monitoring, U.S Environmental ProtectionAgency, accessed July 29, 2014, http://www.epa.gov/glnpo/monitoring/great_minds_great_lakes/social_studies/without.html.65Consumptive Water Use in the Great Lakes Basin, U.S.Geology Survey 2008, accessed July 24, 2014, http://pubs.usgs.gov/fs/2008/3032/pdf/fs2008-3032.pdf66“Discussion on Oil Spill Impact”, Planete-Energies,accessed June 14,2014, http://www.black-tides.com/index.php?chapitre=chap_3&menu=c267Great Lakes Monitoring, U.S Environmental ProtectionAgency, accessed July 29, 2014, http://www.epa.gov/glnpo/monitoring/great_minds_great_lakes/social_studies/without.html. The article outlines the major industries shipping cargoacross the Great Lakes.68“Oil trains crow out grain shipments to NW ports”, SeattleTimes, accessed Aug 15, 2014, http://seattletimes.com/html/businesstechnology/2024172633_columbiatrainsxml.html69Frittelli et al., US Rail Transportation of Crude Oil, 1.70Frittelli et al., US Rail Transportation of Crude Oil, 5-7.71“More oil spilled from trains in 2013 than in previous 4decades, federal data show”, McClatchy WashingtonBureau, accessed July 4, 2014, http://www.mcclatchydc.com/2014/01/20/215143/more-oil-spilled-from-trains-in.html. Oil spilled in 2013 was 1.1 million gallon as opposed to792,600 gallons between 1975-2012.72Frittelli et al., US Rail Transportation of Crude Oil, 14.73Furchtgott-Roth and Green, Intermodal Safety, 2. The studystates that while Canada shipped 20,000 barrels per day(bbl/d) by rail in 2011, the United States ships 115,000 barrelsof oil per day, as of 2013 with a projected trend showing anincrease to 300,000 barrels shipped per day by rail by 2015.74Xiang Liu, et al., “Analysis of causes of major train derailmentand their effect on accident rates”, Journal of TransportationResearch Board, No. 2289 (Transportation Research Board ofthe National Academies: Washington, 2012)75Frittelli et al., US Rail Transportation of Crude Oil, 12.76“Alabama Oil-Train Derailment”, Huffington Post 2013,accessed July 31, 2014, http://www.huffingtonpost.com/2013/11/11/alabama-oil-train-derailment_n_4252887.html77Presentation on “DOT-111 Tank Car Design”, Office ofRailroad, Pipeline and Hazardous Materials Safety, NationalTransportation Safety Board, 2012, accessed July 5, 2014,http://www.ntsb.gov/news/events/2012/cherry_valley/presentations/hazardous%20materials%20board%20presentation%20508%20completed.pdf.78Rail Safety Recommendations - 23 January 2014,Transportation Safety Board of Canada, 4, accessed August15, 2014, http://www.tsb.gc.ca/eng/recommandationsrecommendations/rail/2014/rec-r1401-r1403.pdf.79Bill Demarest, “Train Accident in West Nyack”, Nyack FreePress, December 6, 2013, accessed Aug 16, 2014, http://nyackfreepress.blogspot.com/2013/12/train-accident-in-westnyack.html80Frittelli et al., US Rail Transportation of Crude Oil, 22.81Safe Placement of Train Cars: A Report (U.S. Department ofTransportation and Federal Railroad Administration, 2005),5-10.82Frittelli et al., US Rail Transportation of Crude Oil, 16.83David Pumphrey, et al., Safety of Crude Oil by Rail (Center forStrategic and International Studies, 2014), 3.84Rail Safety: Improved Human Capital Planing Could AddressEmerging Safety Oversight Challenges (U.S GovernmentAccountability Office, 2013), 24.

CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014 1785See http://www.stb.dot.gov/filings/all.nsf/ba7f93537688b8e5852573210004b318/ce390a014c57664785257cb7006eb630/$FILE/235863.pdf86“Rail Safety Staff Activities: Federal rulemaking follow-up tothe Lac Megantic crude oil train tragedy”, California PublicUtilities Commission Safety and Enforcement Divisions,accessed June 15,2014, http://www.cpuc.ca.gov/NR/rdonlyres/A51DD641-447D-4C07-9B68-C8928618B2B0/0/9513CommissionMeetingAgenda3321.pdf. The report statesthat there were 47 causalities from explosion and fire and theeffects of the blast were felt to about 1 mile radius.87Marry-Jane Bennett, M, “Lessons from Lac Megantic – Riskin Transportation of Dangerous Goods, Frontier Center ForPublic Policy, Backgrounder No. 113, 2013, 3-4. The pricingof railways is structured to increase traffic and to decreaseoperational cost/expenses. Moreover, with market prices ofTIH (toxic inhalation hazards) and other dangerous goodsremaining relatively low, the transportation price remainsrelatively low in relation to risk as well. Not only is the pricinglow, federal laws in both Canada and United States limitthe extent to which railways can raise rates in an attempt tocover the risks in the transportation of these goods. Followingthis, in the Lac Mègantic incident in 2010, the railroadcompany sought bankruptcy and eventually the governmentused the taxpayer’s money to rebuild the local economy.88Refer footnote 39 in this article.89“Oil Shipment by rail, truck, and barge up substantially”,Institute For Energy Research, accessed June 24, 2014, http://instituteforenergyresearch.org/analysis/oil-shipments-by-railtruck-and-barge-up-substantially/90U.S. Rail Transportation of Crude Oil: Background and Issuesfor Congress, (Congressional Research Service, 2014), Figure3, 4.91CSX Transportation claims that “For every billion ton-miles ofhazardous materials transported, trucks are involved in morethan 10 times as many accidents as the railroads.” UnionPacific Railroad claims that trucks are “16 times more likelythank train to have hazmat incident.”.92“Portion of I-69 remains closed due to tanker explosion”,ABC12 News, accessed July 6, 2014, http://www.abc12.com/story/24347559/portion-of-i-69-remains-closed-followingtanker-explosion.In Genesee County, Michigan, a tankercarrying crude oil slipped, crashed and exploded on January2, 2014. Hydro carbons were released in the air and therewas a temporary evacuation.93Cargo Tank Trucks (U.S. Government AccountabilityOffice,2013), 6. Figure 2A points out the possible risksassociated during loading-unloading process at deliverypoints and fuel loading terminals.94Cargo Tank Trucks (U.S. Government AccountabilityOffice,2013), 1-7.95Cargo Tank Trucks: Improved Incident Data and RegulatoryAnalysis Would Better Inform Decisions about Safety Risks,(U.S Government Accountability Office, 2013), 3.96Furchtgott-Roth and Green, Intermodal Safety, 11. Theauthors use Hazmat incident database for incidents between2005-2009 to conclude that road transportation have thehighest incidents per billion ton-miles in the U.S. Moreover,road transportation also has the highest fatality rate amongstthe different modes of crude oil transport.97“Tanker spills, pipelines raise questions about crude oiltransport”, Desert News, accessed June 24, 2014, http://www.deseretnews.com/article/865602091/Healthdepartment-concerned-about-culinary-water-after-semiaccident.html?pg=all.On April 30, 2014, a tanker crashedand spilled 4,800 gallons of oil in Parleys Canyon, Utah. SaltLake City Department of Public Utility said about 100 feet ofactive stream was affected by the spill.98“Tanker truck spill oil, explodes on Long Island”, FoxTwelveNews. accessed June 24, 2014, from: http://www.myfoxny.com/story/24248525/tanker-truck-overturns-on-nys-longisland-2-hurt.Twelve vehicles and three homes were damagedwhile the driver suffered minor injuries in the incident.99Yadullah Hussain.Are The Great Lakes the New TransportLane for Alberta Crude Oil? Financial Post, December 16,2013. From: http://business.financialpost.com/2013/12/12/are-the-great-lakes-the-next-pipeline-for-alberta-crude-oil/?__lsa=cb87-b7c1 Accessed July 31, 2014.100New Town, North Dakota has a make shift facility wheretrucks transfer the Bakken oil from well heads to CentralPacific rail cars . he Central Pacific Rail branch line terminatesat New Town, ND. The Google image shows the make shiftfacility where tank trucks load oil onto railcars. At the bottomof the image, a more permanent loop track construction canbe seen. http://goo.gl/maps/uBRR5101For more information, see http://www.boemidstream.com/our-facilities/.102For details on BNSF Crude Oil trans-load facilities, see https://www.bnsf.com/customers/oil-gas/interactive-map/pdfs/BNSF-OG-Overview-Map.pdf.103For details on Canadian Pacific intermodal terminals, seehttp://www.cpr.ca/en/our-network-and-facilities/Pages/default.aspx104For more information on Great Lakes Ports, see http://www.great-lakes.net/teach/business/ship/ship_4.html105“Manual of Best Management Practices for Port OperationsAnd Model Environmental Management System”, GreatLakes Maritime Research Institute, accessed July 30, 2014,http://greatlakesports.org/pp/uploads/CorsonStudyFinal.pdf.106Barlow, Liquid Pipeline, 10.107For a detailed understanding of associated risks duringloading and unloading processes that can cause acatastrophic accident, please see http://www2.uwstout.edu/content/lib/thesis/2000/2000trianag.pdf108Curt Hart and John Bernhardt, Department of Ecology SpillManagement Program: Prevention and Response Activities:1994 Annual Report (Washing State Department of Ecology,1994).

18 CARDI REPORTS/ISSUE NUMBER 15/NOVEMBER 2014109“100 gallons of oil spiked from rail car at Port of Albany”,Times Union, accessed July 3, 2014, http://www.timesunion.com/local/article/100-gallons-of-oil-spills-from-Port-of-Albany-5588442.php.110“Crude Loves Rock ‘n’ Rail – Bakken Oil Express, DakotaPlains, Bakken Link, & Savage”, RBN Energy 2013, accessedJuly 30, 2014, https://rbnenergy.com/bakken-oil-expressdakota-plains-bakken-link-and-trenton-railport.The articlesays that both the transshipment points, Bakken Oil Expressand Dakota Plains have increased their infrastructure and oilstoring capacity since 2011.111“Manual of Best Management Practices for Port OperationsAnd Model Environmental Management System”, GreatLakes Maritime Research Institute, accessed July 30, 2014,http://greatlakesports.org/pp/uploads/CorsonStudyFinal.pdf.112For more information on Great Lakes natural hazards,seehttp://www.greatlakesresilience.org/climate-environment/coastal-hazards-risks. For more information on GreatLakes Coastal Analaysis and Mapping, see http://www.greatlakescoast.org/great-lakes-coastal-analysis-andmapping/.113“Oil Spill Cleanup Operation Continues At Texas City DikeAfter Barge and Tanker Collide”, ABC13 News, accessedJune 15, 2014, http://abc13.com/archive/9476801/. TheHouston Ship Channel was blocked for 2 days following acollision of a barge with an oil tanker at the Texas City Dikeon March 22, 2014. As many as 60 vessels, most of thempetrochemicals, were restricted to get out and get in theport.114“Risk Assessment for Railroads”, Sightline Daily, accessedJuly 3, 2014, http://daily.sightline.org/2014/05/19/riskassessment-for-railroads/.James Beardly, as quoted in EricDe Place’s article, “The maximum possible coverage is $1.5billion in liability insurance for Class 1 railroads. Consideringthat the Lac Megantic impact alone was more than $2billion, the coverage seems insufficient especially when theimpacts can be severe in a more dense urban area.”115Stephen Breyer, Breaking The Vicious Circle: TowardsEffective Risk Regulation (Cambridge: Harvard UniversityPress, 1993), 56.116Susan Christopherson, et al., Risks and Risk Governancein Unconventional Shale Gas Development (EnvironmentalScience & Technology, 2014, accessed October 9, 2014,http://pubs.acs.org/doi/pdf/10.1021/es502111u117On May 7, 2014, Anthony Foxx (Secretary of Transportation,U.S. DOT) signed an order that requires all operating trainscontaining 1,000,000 gallons or larger amount of crudeoil to provide the appropriate SERC – State EmergencyResponse Commission – with notification regarding theirmovement through the state’s counties. However, sucha step is yet to be amended and requires huge logisticalplanning of the current human capital with the FRA.118Patrick Roberts, Review of Catastrophe: Risk and Responseby Richard Poser (Oxford University Press, 2004).119Welch, et al., Oil and Water,12. The details of theseprograms can be found under PREP (Preparedness forResponse Exercise Program) guidelines.120Shanese Crosby et al., Transporting Alberta Oil SandsProducts, 6.121A Survey of Bakken Crude Oil Characteristics AssembledFor the U.S. Department of Transportation, Submitted byAmerican Fuel & Petrochemical Manufacturers (DangerousGoods Transport Consulting, 2014), 4.122For more information on land use planning in Great Lakes,see http://www.great-lakes.net/teach/pollution/sprawl/sprawl_2.html




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