Increased Oil and Hazardous Materials Transportation: Why Developing Relationships Matter

Jeanette Manning, NAGTRI Program Counsel

Jeanette Manning, NAGTRI Counsel

On July 6, 2013, Lac-Mégantic, a small town in Quebec, Canada that borders Maine, was set ablaze and the downtown nearly destroyed after a runaway train carrying Bakken oil from North Dakota sped downhill and derailed at a rate of 63 mph.[1] Five of the 73 tank cars exploded, ultimately resulting in the horrific deaths of 47 people, 40 buildings being destroyed, and an environmental disaster after millions of liters of crude oil spilled into the town and its lake and river.[2] Even though some had been pondering how to safely transport oil and other hazardous materials by rail and other means prior to “Lac-Mégantic,” this catastrophic event caught the attention of citizens, lawmakers, and the industry and quickly resulted in regulatory and policy changes in the United States and Canada. Unfortunately, since this incident, there have been other train derailments – not nearly as catastrophic as Lac-Mégantic but still serious nonetheless – most recently in Lynchburg, Va., on April 30, and one in LaSalle, Colo., on May 10.

With the dramatic increase of oil being transported by rail in the United States from increased production with hydraulic fracturing, questions linger as to how to ensure that safety remains a priority. Articles are posted daily about the increase of hazardous materials and oil in the United States and what regulators and officials should be doing to ramp up safety efforts. While contemplating myriad safety options, states should consider developing a relationship with the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) if one has not yet been established. This small agency could serve as a resource to states simply as a means to take proactive steps and prepare for or prevent a catastrophe or to work with once an unfortunate event occurs.

I recently learned from working with a group of nuclear waste attorneys and others within the attorney general community that they were unfamiliar with PHMSA and how this agency could assist them in their practice. In April, the National Attorneys General Training and Research Institute (NAGTRI) held an Energy and Environment Training (EET) in Arkansas. Following presentations on PHMSA and oil spills, several assistant attorneys general noted that they never heard of or fully understood the scope of PHMSA’s legal authority or fully grasped the amount of oil and hazardous materials transportation occurring in the United States. Hence, this article serves to briefly introduce the attorney general community to PHMSA for those unfamiliar with the agency and offer some limited, initial suggestions that may be worth considering when advising client natural resource and environmental agencies.

Introduction to PHMSA

PHMSA is a U.S. Department of Transportation agency with a legal mandate to create and enforce regulations related to safely transporting materials via the country’s 2.6 million miles of pipeline and the approximate one million daily shipments of hazardous materials by various modes, including air, water, rail, and land.[3] PHMSA has statutory authority to operate pursuant to the Norman Y. Mineta Research and Special Programs Improvement Act under P.L. 108-426 of 2004.[4] Specifically, PHMSA’s mission per its website is to “protect people and the environment from the risks inherent in transportation of hazardous materials – by pipeline and other modes of transportation.”[5] According to PHMSA, its primary objectives are to focus on safety, environmental stewardship, reliability, global connectivity, and preparedness and response.[6]

Since PHMSA is legally responsible for both pipeline and hazardous material shipments, two separate offices regulate these distinctly different transportation methods. The Office of Pipeline Safety (OPS) has full authority to address the country’s extensive pipeline system and associated issues while the Office of Hazardous Materials Safety (OHMS) regulates the transportation of hazardous materials by air, rail, highway, and water.

The Office of Pipeline Safety

OPS has various functions related to the safety of natural gas and hazardous liquid pipeline transportation. Of critical importance to the states is the availability of the Pipeline Safety Inspector Training and Qualifications Division in Oklahoma. This training center provides supportive and technical assistance to federal and state pipeline safety inspectors and offers regional and state seminars. Since PHMSA has such a small number of federal inspectors, most inspection authority lies with the states. As such, this training division can assist states to learn about government and industry standards, regulations, compliance, enforcement, and inspection techniques. Additionally, OPS generally can assist states with, inter alia, providing information on pipeline regulations and proposed rulemaking, statistics, special programs, reports on activities, and corrective action orders.[7] The website for OPS offers additional information about its reach and can be accessed at http://phmsa.dot.gov/pipeline.

The Office of Hazardous Materials Safety

OHMS functions in all capacities to address transportation of designated hazardous materials by air, rail, sea, or land. Of critical importance to states is PHMSA’s outreach assistance to help facilitate compliance with the hazardous materials regulations and the offer of free seminars multiple times per year. A Hazardous Materials Safety Assistance Team has been designated to assist with training and the hosting of seminars throughout the country, including a one-day Hazmat Transportation Workshop, and a two-day Multimodal Training Seminar. These trainings can provide assistance to the local community, industry, and state employees tasked with handling or better understanding hazardous materials transportation. Additionally, OHMS generally assists states with, inter alia, supplying guidance documents, information about permits and approvals, action reports, emergency preparedness guidebooks for first responders, and information about available grants.[8] The website for OHMS offers additional information about its reach and can be accessed at http://phmsa.dot.gov/hazmat.

PHMSA Outreach

The PHMSA Office of Chief Counsel (Office) participated in the 2013 NAAG Fall Meeting in New Orleans, La. During this meeting and in other settings in communication with NAAG and NAGTRI, the Office has noted its interest in developing or enhancing its relationship with NAAG’s members. Facilitators during the EET shared their experiences about lessons learned after oil pipelines ruptured in their states; one noted that communicating with PHMSA prior to the spill would have benefitted the attorney general’s office to develop best practices as a proactive measure. Given PHMSA’s position that it is interested in working with the states, additional information about the agency and answers to frequently asked questions can be accessed on the website at http://phmsa.dot.gov/about/faq, and the number is 202-336-4433.

Possible State Considerations

Transporting oil by rail in the United States has literally skyrocketed in the recent past and impact states directly. Since 2005, rail shipments carrying crude oil has increased by 443 percent according to the 2012 annual report by the American Association of Railroads.[9] Naturally, with such significant increases in oil rail shipments in the United States, it is not unanticipated that there also has been a noticeable increase in documented train derailments. Derailments that received coverage from trains carrying crude oil have occurred in Pennsylvania, Alabama, North Dakota, Virginia, and Colorado.[10] These train derailments have resulted in considerable damage, including oil spills, contaminated waters and soil, mandatory evacuations, tanker cars bursting into flames, and environmental hazards requiring containment and cleanup.

Clearly, safety has been a priority to varying degrees for states, regulators, and the industry because if it were not more accidents would have occurred merely from the sheer volume of transports in our country’s pipelines. Despite concerted safety efforts, environmental upheavals still cause serious harm. Most notably in recent history, the BP Deepwater Horizon oil rig spill (resulting in over 200 million gallons of oil entering the Gulf of Mexico and killing 11 people), and the Enbridge and Exxon pipeline spills in Michigan and Arkansas, respectively, highlight the seriousness and devastation that spills produce.[11] Pipeline spills impact the states considerably including an affected local economy, defense of litigation, health issues for its citizens, cleanup costs from environmental hazards, harm to wildlife, decreased property values, human loss of life or deteriorated health, and environmental devastation.

According to PHMSA, within the last 10 years, 163,437 incidents have occurred involving all modes of transportation, costing over $700 million in damages.[12] Given these statistics and the fact that the above-described catastrophic events cannot be eliminated entirely, states and assistant attorneys general must still assess safety measures as they advise their clients and oil and hazardous materials transportation continue to touch their states. Developing relationships with PHMSA and other critical stakeholders at the outset to develop best practices help states to be proactive, and some limited but immediate considerations in doing so include:

  • Conducting a state assessment of readily-available statutes and regulations that apply to rail transportation and other forms of transportation for oil and hazardous materials; and determining where gaps exist in the law for possible legislative changes or enactment of new laws after consultation with client agencies to identify regulatory hurdles.
  • Reviewing PHMSA’s guidance documents and guidebooks for first responders and encouraging clients and/or attorneys to participate in free seminars that are offered throughout the country to gather information and educational resources.
  • Considering improved regulations to match the changing industry, including better-quality puncture-resistant tanker cars, traveling in less populous areas, properly labeling hazardous materials, and ensuring that pipelines can support the traveling materials.
  • Inviting and meeting with industry representatives, as needed, regarding their safety plans, incident reports, employee training, and compliance with state and federal laws.
  • Arranging a meeting with state attorneys general offices and state regulators where an incident has previously occurred to receive advice on lessons learned and suggested best practices to proactively develop a plan of action that reduces the harm.
  • Evaluating and revising state emergency preparedness and response guidebooks.
  • Reaching out to arrange for a meeting with appropriate PHMSA representatives, including the Office of Chief Counsel, for litigation support on enforcement actions (where warranted) or to discuss the tools that comprise the best practices.


[1] Monique Beaudin, Lac-Mégantic disaster: Where things stand today (January 23, 2014), available at http://www.montrealgazette.com/news/M%C3%A9gantic+disaster+Where+things+stand+today/9418300/story.html (last visited May 10, 2014); Sean Farrell, Death Toll from Quebec Train Derailment Feared to Be in the Dozens (July 9, 2013), available at http://www.huffingtonpost.com/2013/07/09/quebec-train-death-toll_n_3568464.html (last visited May 10, 2014).

[2] Id.

[3] About PHMSA, U.S. Dep’t of Transp. Pipeline and Hazardous Materials Safety Admin., http://phmsa.dot.gov/about/agency/ (last visited May 10, 2014).

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Megan Fitzpatrick, Lake Mégantic train crash a wake-up call for U.S. rail safety (March 11, 2014), available at http://www.cbc.ca/news/canada/montreal/lac-m%C3%A9gantic-train-disaster-voted-top-news-story-of-2013-1.2476212 (last visited May 10, 2014).

[10] Selan Gebrekidan, CSX train carrying oil derails in Virginia in fiery blast (April 30, 2014), available at http://www.reuters.com/article/2014/04/30/us-railways-accident-virginia-idUSBREA3T0YW20140430 (last visited May 10, 2014); 6 Cars of Crude Oil Train Derail Near LaSalle, Colorado, Associated Press (May 10, 2014), available at http://www.huffingtonpost.com/2014/05/10/crude-oil-train-colorado_n_5298679.html?utm_hp_ref=green (last visited May 10, 2014); Train Carrying Crude Oil Derails in Pennsylvania, New York Times (Feb. 13, 2014), available at http://www.nytimes.com/2014/02/14/business/energy-environment/train-carrying-oil-derails-in-pennsylvania.html?_r=0 (last visited May 10, 2014); Emily Atkin, Train Derailment in Philadelphia Leaves Crude Oil Car Dangling Over Schuylkill River (Jan. 21, 2014), available at http://thinkprogress.org/climate/2014/01/21/3184641/crude-oil-train-derailment-philadelphia/ (last visited May 10, 2014); Edward McAllister, Train carrying crude oil derails, cars ablaze in Alabama (Nov. 8, 2013), available at http://www.reuters.com/article/2013/11/08/us-crude-train-explosion-idUSBRE9A70Q920131108 - Reuters / (last visited May 10, 2014); Daniella Silva, News Mile-long train carrying crude oil derails, explodes in North Dakota (Dec. 30, 2013), available at http://usnews.nbcnews.com/_news/2013/12/30/22113442-mile-long-train-carrying-crude-oil-derails-explodes-in-north-dakota?lite (last visited May 10, 2014).

[11] Christine Dell'Amore, Gulf Oil Spill "Not Over": Dolphins, Turtles Dying in Record Numbers (Apr. 8, 2014), available athttp://news.nationalgeographic.com/news/2014/04/140408-gulf-oil-spill-animals-anniversary-science-deepwater-horizon-science/ (last visited May 10, 2014); Nora Caplan-Bricker, This Is What Happens When a Pipeline Bursts in Your Town (Nov. 18, 2013), available at http://www.newrepublic.com/article/115624/exxon-oil-spill-arkansas-2013-how-pipeline-burst-mayflower (last visited May 10, 2014); Steve Carmody, Oil soon will soon be flowing through Enbridge’s new pipeline in Michigan (April 7, 2014), available at http://michiganradio.org/post/oil-will-soon-be-flowing-through-enbridges-new-pipeline-michigan (last visited May 10, 2014).

[12] U.S. Dep’t Transp., 10 Year Incident Summary Report, Hazmat Intelligence Portal (2014), available at https://hip.phmsa.dot.gov/analyticsSOAP/saw.dll?Dashboard (last visited May 10, 2014).

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