[Federal Register Volume 85, Number 98 (Wednesday, May 20, 2020)]
[Proposed Rules]
[Pages 30673-30680]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-10377]
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DEPARTMENT OF TRANSPORTATION
Pipeline and Hazardous Materials Safety Administration
49 CFR Parts 171, 172, 173, 174, 177, 178, 179, 180
[Docket No. PHMSA-2016-0077 (HM-251D)]
RIN 2137-AF24
Hazardous Materials: Vapor Pressure of Unrefined Petroleum
Products and Class 3 Materials
AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA),
Department of Transportation (DOT).
ACTION: Advance notice of proposed rulemaking (ANPRM); withdrawal.
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SUMMARY: PHMSA is withdrawing the January 18, 2017, ANPRM concerning
vapor pressure for crude oil transported by rail. PHMSA's decision is
based on comments received to the ANPRM, as well as an extensive study
conducted by the Sandia National Laboratories which found that the
vapor pressure of crude oil is not a significant factor in the severity
of pool fire or fireball scenarios, and concluded that results of the
study do not support creating a regulatory distinction for crude oils
based on vapor pressure. In withdrawing the ANPRM, PHMSA is providing
notice of its determination that the establishment of vapor pressure
limits would not improve the safety of rail transportation of crude
oil. Therefore, PHMSA is no longer considering vapor pressure limits
for the transportation of crude oil by rail or any other mode.
Furthermore, PHMSA is also providing notice that, after considering
comments received to the ANPRM, it is no longer considering imposing
vapor pressure standards for other unrefined petroleum-based products
and Class 3 flammable liquid hazardous materials by any mode.
DATES: As of May 20, 2020, the ANPRM published on January 18, 2017 (82
FR 5499), is withdrawn.
FOR FURTHER INFORMATION CONTACT: Lad Falat, Sciences, Engineering, and
Research (PHH-20), Telephone (202)
[[Page 30674]]
366-4545, or Ryan Larson, Standards and Rulemaking Division (PHH-10),
Telephone (202) 366-8553. U.S. Department of Transportation, Pipeline
and Hazardous Materials Safety Administration, 1200 New Jersey Avenue
SE, East Building, 2nd Floor, Washington, DC 20590-0001.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. PHMSA Regulation of High-Hazard Flammable Trains
B. North Dakota Order
C. New York Petition
D. Advance Notice of Proposed Rulemaking
i. Overview of ANPRM Comments
ii. Comments in Support of the Vapor Pressure Standard
iii. Comments Opposed to Vapor Pressure Standards
II. Crude Oil Characterization Research Study (Sandia Study)
A. Congressional Mandate
B. Phases of the Sandia Study
i. Initial Phase
ii. Task 1
iii. Task 2
iv. Task 3
v. Sandia Study Completion
III. PHMSA's Decision
IV. Preemption of all Non-Federal Laws
I. Background
A. PHMSA Regulation of High-Hazard Flammable Trains
On May 8, 2015, PHMSA published a final rule titled ``Hazardous
Materials: Enhanced Tank Car Standards and Operational Controls for
High-Hazard Flammable Trains'' [HM-251; 80 FR 26643]. The final rule
addressed safety concerns that arose following high-profile rail
incidents involving crude oil produced in the Bakken region of the
United States.\1\ The HM-251 rulemaking targeted the hazards associated
with the shipment of flammable liquids by rail by establishing enhanced
standards for the tank cars used to transport Class 3 flammable
liquids, operational controls in the form of reduced operating speeds
and enhanced braking requirements, rail routing risk assessment and
notification, and requirements for more accurate classification of
unrefined petroleum-based products. In the HM-251 notice of proposed
rulemaking (NPRM) [79 FR 45015], that preceded the May 8, 2015 final
rule, PHMSA sought comments from the public on the appropriate role of
vapor pressure in classifying flammable liquids and selecting
packagings, including the threshold question regarding whether vapor
pressure limits should be established. After reviewing the comments to
the NPRM, PHMSA determined that additional research was necessary, and
accordingly, PHMSA decided not to establish new vapor pressure
requirements in the final rule. However, PHMSA expressed its intent to
consider the issues raised by the commenters in a future regulatory
action depending upon the outcome of extensive research efforts being
undertaken by the Department.
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\1\ The Bakken shale formation, a subsurface formation within
the Williston Basin (spanning eastern Montana, western North Dakota,
South Dakota, and southern Saskatchewan), is one of the top oil-
producing regions in the country and in the world. The Bakken shale
formation's low permeability (i.e., it is a ``tight'' formation)
requires hydraulic fracturing to produce oil (so-called ``tight
oil'') at commercial rates.
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B. North Dakota Order
In December 2014, as PHMSA was in the process of developing the HM-
251 final rule, the North Dakota Industrial Commission (NDIC) issued
Oil Conditioning Order No. 25417 (NDIC Order), which requires operators
in the State of North Dakota to separate the gaseous and light
hydrocarbons from all Bakken crude oil produced in North Dakota. The
NDIC Order requires the use of a gas-liquid separator and/or an
emulsion heater-treater capable of separating the gaseous and liquid
hydrocarbons; prohibits blending of Bakken crude oil with specific
materials; and requires crude oil produced to have a vapor pressure
(determined using ASTM D6377 \2\) no greater than 13.7 pounds per
square inch (psi), or 1 psi less than the vapor pressure of stabilized
crude oil as defined in the latest version of ANSI/API RP3000.
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\2\ ASTM D6377 refers to ``ASTM D6377--Standard Test Method for
Determination of Vapor Pressure of Crude Oil: VPCRx (Expansion
Method).''
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C. New York Petition
On December 1, 2015, the New York State Office of the Attorney
General (NYSOAG) submitted a petition for rulemaking (P-1669)
requesting PHMSA establish a vapor pressure standard for crude oil
shipped by rail [PHMSA-2015-0253-0001 (Dec. 3, 2015)]. Although PHMSA
codified several additional safety requirements in the HM-251 final
rule, the NYSOAG petition asserted that the measures implemented by the
final rule were insufficient to reduce significantly the risk of high
impact fires or explosions because they did not specifically address
vapor pressure limits. The NYSOAG petition requested that PHMSA revise
Sec. 174.310 to establish a Reid Vapor Pressure (RVP) limit that is
less than 9.0 psi for crude oil transported by rail. The NYSOAG
petition asserted that limiting the product's vapor pressure would
reduce the risk of death or damage from fire or explosion in the event
of an accident. While the NYSOAG petition did not provide any specific
cost data, the petitioner cited increasing numbers of shipments of
Bakken crude oil by rail, past train explosions involving shipments of
Bakken crude oil, Bakken crude oil volatility and flammability, and the
presence of existing technology to reduce the volatility of crude oil
as justification for the requested revisions to the Hazardous Material
Regulations (HMR; Parts 171-180).
D. Advance Notice of Proposed Rulemaking
On January 18, 2017, PHMSA published an ANPRM [HM-251D; 82 FR 5499]
in response to the NYSOAG petition. The ANPRM solicited public comments
on the merits of the petition based on the perceived safety benefits of
establishing vapor pressure limits for unrefined petroleum-based
products and potentially all Class 3 flammable liquid hazardous
materials. PHMSA posed 39 questions requesting specific information
regarding the options for, as well as the benefits of, limiting vapor
pressure in transportation. PHMSA sought public comment to obtain the
views of entities impacted by the NDIC Order, as well as those who were
likely to be impacted by the changes requested in the NYSOAG petition,
including those likely to benefit from, be adversely affected by, or
potentially be subject to additional regulation.
i. Overview of ANPRM Comments
In response to the HM-251D ANPRM, PHMSA received comments from
approximately 80 individuals and organizations. The following table
categorizes the comments received according to commenters' background.
[[Page 30675]]
Commenters to the ANPRM
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Number of Description and examples
Commenters' background comments of category
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Non-Government Organizations..... 10 Environmental groups
(2), Advocacy/lobby
groups (5), and other
non-governmental
organizations (3).
Governments...................... 6 Local (2), State (4).
Individuals...................... 54
Carrier Industry Stakeholders.... 4 Carrier related trade
associations.
Shipper Industry Stakeholders.... 9 Shippers and petroleum
related trade
associations.
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PHMSA asked specific questions regarding the general benefits,
limitations, and impacts of establishing a maximum vapor pressure for
crude oil or flammable liquids; the safety implications at play when
considering the proposed vapor pressure standard; the merit and methods
of measuring vapor pressure for transportation purposes; and general
packaging questions. While the NYSOAG petition specifically requested
that PHMSA set a vapor pressure standard for crude oil by rail, PHMSA
solicited comment in the ANPRM about whether the scope of the safety
standard should be broadened to include other Class 3 flammable liquids
by different modes of transportation, such as highway. The ANPRM also
asked whether risk factors other than vapor pressure should be
considered in PHMSA's effort to increase the safety of transporting
flammable liquids.
Most comments fit within one of three categories: (1) Generalized
support for a maximum vapor pressure limit with expressed concerns
about the associated risks of transporting unrefined petroleum-based
products in highly populated areas and sensitive environments; (2) not
supportive of maximum vapor pressure limits citing to a lack of
evidence demonstrating that limiting vapor pressure would reduce risks
associated with the transport of unrefined petroleum-based products or
other Class 3 materials and suggesting that PHMSA should wait until the
completion of a study on crude oil characteristics recently undertaken
by Sandia National Laboratories (Sandia) before undertaking any
rulemaking; or (3) not supportive of vapor pressure requirements being
applied to shipments by highway.
ii. Comments in Support of the Vapor Pressure Standard
Approximately 60 commenters generally supported setting additional
safety standards for the transportation of crude oil that would be
based on specific measurable metrics, such as vapor pressure. Most
commenters who expressed their support for the proposed RVP standard
stated that a lower vapor pressure would minimize the severity of fires
in the event of a train crash or derailment. Several commenters
asserted that there is ample evidence demonstrating that a higher RVP
corresponds to more detrimental explosions. However, the comments in
support of this claim were ultimately anecdotal, providing little to no
data to substantiate any such correlation. Most of the comments
supporting the implementation of a vapor pressure standard were
submitted by members of the public who were concerned about the effects
that an accident in their community would have on the surrounding
environment and personal property.
Most of the commenters in favor of vapor pressure limits expressed
support for a vapor pressure limitation for crude oil by rail
specifically. Many of these commenters referenced the conditioning
requirements in the NDIC Order as evidence of the feasibility and
necessity of implementing an RVP standard and encouraged PHMSA to
follow suit. While many supporters of a vapor pressure standard were in
favor of the standard proposed in the NYSOAG petition, some suggested
that the standard should be as low as 4.0 psi. These commenters alluded
to certain practices and requirements currently in place in the oil
production industry that require reducing the volatility of crude, such
as pipeline operational standards and degasification requirements in
place in Texas. One such commenter recommended setting a standard
between 4-8 psi.
Similarly, commenters from David & Associates and the Natural
Resources Defense Council (NRDC) pointed to certain national and State
vapor pressure limitations that are in place for gasoline as evidence
of the merit and feasibility of nationwide vapor pressure
restrictions--stating that the restrictions would reduce the
consequences of a potential incident by reducing the release of evolved
gases from the transported product. However, David & Associates
conceded that those restrictions were implemented with the intent of
minimizing the pollution associated with volatile organic emissions
rather than with the intention of mitigating safety risks during
transportation. NRDC further urged PHMSA to set an interim standard
until all necessary data is collected, rather than setting a permanent
standard without sufficient evidence.
A small number of commenters stated that if a vapor pressure
standard is implemented, it should not apply to transportation by
highway. One commenter from the Scenic Hudson Group noted that the
safety hazards by rail outlined in the NYSOAG petition are also
concerns for shipments carried out on waterways, such as the Hudson
River. One member of the public was in favor of setting the vapor
pressure limit for all modes of transportation.
A commenter from the Department of Environmental Conservation of
New York was in support of additional safety measures other than a
vapor pressure limit for shipments of crude oil and suggested that
direct limits on C1-C4 hydrocarbons would be more effective than
restricting vapor pressure.
A comment jointly submitted by the Attorneys General of New York,
California, Illinois, Maine, Maryland, and Washington (State AGs)
supported a nationwide limit on the vapor pressure of crude oil
transported by rail in the United States, noting that PHMSA is not
required to determine that vapor pressure is the ``best metric'' to use
in decreasing fire and explosion risks before developing a vapor
pressure regulation.
iii. Comments Opposed to Vapor Pressure Standards
Twenty-one commenters strongly opposed the proposed vapor pressure
limitations on either crude oil or other Class 3 flammable liquids by
highway or rail. Some commenters completely rejected the use of vapor
pressure as a basis for classification, while others suggested that
PHMSA wait until the completion of the Sandia Study after which data
regarding the volatility of crude oil would be available. Several
commenters noted the lack of empirical data to support the claims in
the
[[Page 30676]]
petition. PHMSA further categorized the comments received under the
following topic areas.
Vapor Pressure
Several commenters rejected the premise of the NYSOAG petition and
the concept that the volatility of crude oil is the primary cause of
large explosions and uncontrollable fires in train accidents. In their
comments, American Fuel & Petrochemical Manufacturers (AFPM), American
Petroleum Institute (API), and NDIC similarly assert that vapor
pressure is not the primary cause of ignition in crude oil by rail
accidents. Instead, these commenters attributed the fires associated
with the rail incidents cited in petition P-1669 to the presence of a
flammable substance and source of ignition during the accidents.
Commenters--such as the International Liquid Terminals Association
(ILTA) and API--echoed that reducing the volatility of crude oil prior
to shipment would not decrease the expected degree, consequence, or
magnitude of a release or the likelihood of a fire during an accident
since the magnitude of a combustion event correlates to the
flammability, rather than the vapor pressure, of the hazardous liquid
released. To further the point, AFPM noted that there are several Class
3 flammable liquids that have low vapor pressures that present similar
ignition risks to Bakken or Permian Basin crude oil and other unrefined
petroleum-based products. API also expressed its belief that focusing
on vapor pressure to mitigate or reduce severity would not achieve the
desired results and, that if implemented, the rule would not
significantly reduce the primary hazard of crude oil, since it would
still be a flammable liquid regardless of the vapor pressure. API
further stated that the more volatile compounds would have to be
removed from crude oil and transported in pressurized tank cars or
pipelines as a separate stream of flammable liquids or gases if a vapor
pressure limit is set below current levels.
Several commenters cited the petition's lack of evidence or other
scientific basis for its claim that reducing vapor pressure will
improve safety. ILTA stated that there was no basis for the assertion
that limiting the vapor pressure of crude oil prior to shipment would
decrease the expected degree, consequence, or magnitude of a release or
the likelihood of a fire during an accident. Similarly, the North
Dakota Petroleum Council (NDPC) noted that there are currently no peer
reviewed scientific studies supporting the belief that an appropriate
level for vapor pressure is already known. API further recommended
investing in and improving the methods for transporting crude safely,
rather than imposing new unilateral RVP limits that are not based on
any scientific evidence.
Other commenters stated that applying a vapor pressure limit to all
modes would materially alter the products being transported and could
have many unintentional consequences that could potentially disrupt the
oil and natural gas supply chain, which would require both the industry
and PHMSA to reevaluate the current system to determine whether the
packaging specifications were still appropriate for a materially
altered product.
All Class 3 Flammable Liquids
Certain commenters specifically opposed the proposal to extend
vapor pressure limits to all Class 3 flammable liquids. Dow Chemical
stated that establishing a vapor pressure limit to encompass all
flammable liquids by any mode of transportation would not improve the
safe transportation of chemical products. Their comment reiterated the
point made by several other commenters that the HMR already address the
risk of flammability based on the material's flashpoint and boiling
point. Currently the HMR designate a liquid as ``flammable'' if it has
a flash point of not more than 60 [deg]C, regardless of vapor pressure.
API cautioned that imposing a vapor pressure limit for all Class 3
flammable liquids has potential to change fundamentally how all these
products are classified and packaged. The American Coatings
Associations (ACA) and Railway Supply Institute (RSI) added that crude
oil presents unique risks because of its variable chemical properties
that do not extend to [are not exhibited with] other Class 3 flammable
liquids, such as manufactured goods which undergo strict quality
assurance processes to ensure properties and characteristics are within
defined parameters.
The Council on Safe Transportation of Hazardous Articles (COSTHA)
opposed applying a vapor pressure standard to other Class 3 materials
based on investigation and studies regarding crude oil. The ILTA and
COSTHA noted that extending this classification criterion to other
flammable liquids would have a significant impact on fuels, raw
chemical products, consumer products, and even health services. RSI
further added that without sound scientific information and data, an
expansion of vapor pressure limits to all Class 3 flammable liquids
would be an arbitrary change that would impose additional costs. ILTA
added that limiting the vapor pressure of Class 3 flammable liquids
would also cause conflicts between regulatory agencies and industry.
For example, the Environmental Protection Agency (EPA) regulates fuel
properties to ensure proper emissions performance, and ASTM
International (ASTM) maintains standards for vehicle fuel that include
specified limits on the RVP of gasoline, which exceed 9 psi. ILTA and
RSI similarly warned that setting a limit conflicts with the vapor
pressure limits mandated by one of these other entities would cause
numerous commercial and regulatory burdens.
Not by Highway
While the NYSOAG petition requested a vapor pressure limit for
shipments made by rail, PHMSA asked in the ANPRM whether the proposed
limit should also apply to transportation by highway. Three of the four
commenters that responded to this specific question were opposed to a
vapor pressure limit by highway.
National Tank Truck Carriers (NTTC) stated that while trucks are
the main method for transporting refined petrochemicals from the fuel
rack to gas stations, refined fuel risks are inherently different than
those associated with transporting crude oil. PHMSA already considered
the risks inherent in transporting refined fuels in its combustible
fuel rulemaking and found them to be effectively managed under the
current HMR. Accordingly, NTTC recommended Federal Motor Carrier Safety
Administration (FMCSA) involvement as the agency tasked with regulating
all highway transportation of goods in interstate commerce.
NDPC stated that imposing a vapor pressure reduction requirement on
highway transportation will force oil and gas producers to conduct
unnecessary and extremely burdensome additional sampling at the well
site to ensure compliance with the new standard. NDPC expressed that
imposing vapor pressure limitations by highway may make oil leases
unprofitable.
NDIC further opposed a vapor pressure limit by highway because
there have not been any crude oil truck transport Boiling Liquid
Expanding Vapor Explosion (BLEVE) events in North Dakota.
Regulatory Authority
Several commenters in opposition to the proposed vapor pressure
standard specifically stated that PHMSA did not have the authority to
proceed with
[[Page 30677]]
setting a vapor pressure limitation due to restrictions from recent
executive orders and the Fixing America's Surface Transportation (FAST)
Act (FAST Act; Pub. L. 114-94). Similarly, two commenters stated that
granting the NYSOAG's petition would conflict with PHMSA's obligation
to harmonize the HMR with international regulations.
Signed on January 30, 2017, Executive Order 13771, ``Reducing
Regulation and Controlling Regulatory Costs,'' directs agencies to
repeal two regulations for every new regulation they issue. Commenters
such as API stated that given the financial burden that this rule would
impose, it would be imprudent to move forward with a vapor pressure
standard as it would severely limit PHMSA's ability to implement any
other regulatory actions. In addition, on March 28, 2017, Executive
Order 13783, ``Promoting Energy Independence and Economic Growth,''
obligated PHMSA to identify and revise any regulatory actions that
potentially burden domestic energy production. Citing the
implementation costs that would be associated with the proposed vapor
pressure limits, several commenters alluded to the restrictions imposed
on PHMSA by Executive Orders 13771 and 13783. In its comment, NDPC
noted that any new regulation that requires ``stabilization'' or sets a
vapor pressure threshold for crude oil prior to transportation would
impose substantial cost impacts on the oil and gas production and
transportation industries. According to AFPM, accepting the petition
would force offerors and carriers to treat crude oil or other flammable
liquids as Division 2.1 flammable gases, or incur unreasonable
pretreatment costs.
According to comments from AFPM, API, and NDPC, the foreseen
economic burden would be due not only to the costs of the additional
operational infrastructure and equipment that would be required to meet
new vapor pressure limits, but also to economic losses caused by
resulting conflicts with international standards. Similarly, NDPC
further noted that crude oil is more valuable when it is allowed to be
sold with all of its constituent hydrocarbons and that crude oils with
greater concentrations of light ends can be more valuable because each
of the constituents can be refined and sold at the most economically
efficient location in the supply chain. NDPC explained that separating
the oil prematurely into its individual hydrocarbon constituents
earlier in the supply chain to comply with a regulatory vapor pressure
standard can reduce the overall value of a given barrel of oil as
produced at the wellhead and removing light ends prior to
transportation reduces the volume of crude oil that producers are
ultimately able to sell to refiners and others in the marketplace.
Several commenters--including Independent Petroleum Association of
America (IPAA) and the American Exploration and Production Council
(AXPC)--urged PHMSA to reconsider the ANPRM and suggested that setting
a vapor pressure standard prior to the completion of the Sandia Study
would be premature and incongruous with congressional mandates outlined
in the FAST Act. AFPM noted that the FAST Act reflects Congress's
judgment that the completion of the Sandia Study should be a condition
precedent to any further regulation of the transportation of crude oil.
NDIC, NDPC, AFPM, and several other commenters stated that PHMSA should
delay any decision regarding a vapor pressure standard for crude oil
until the results of the Sandia Study studies are available. To this
point, AFPM added that Task 4 (of the Sandia Study) was specifically
intended to examine whether tight oils might have an elevated risk of
ignition in the event of a rail accident as compared to other crude
oils.
Two others commented that implementing a vapor pressure standard
would undermine international harmonization efforts and impact trans-
border shipments. API stated that, per international agreement, PHMSA
is obligated to ensure harmonization with the United Nations (UN)
Recommendations on the Transport of Dangerous Goods Model Regulations,
which are designed to enhance global trade, economic development,
improve safety and compliance-enforcement capability while simplifying
training requirements for multi-modal cross regional transport of
dangerous goods. API noted that unilateral or arbitrary changes to the
HMR domestically that do not align with UN Model Regulations
requirements would severely impact trans-border shipments and create
significant regulatory uncertainty for shippers and carriers.
HMR Is Sufficient Based on Known Risks
Several commenters stated that the existing regulatory framework of
the HMR, which includes the system of hazard classification and
packaging requirements, adequately addresses the risks associated with
the transportation of hazardous materials. A commenter from Dow
Chemical stated that the HMR provides a comprehensive framework to
address the risks associated with the transportation of flammable
liquids that includes defined criteria for the classification of
flammable liquids and specification of appropriate packaging
requirements. The commenter further stated that as defined in the HMR,
a flammable liquid has a flash point of not more than 60 [deg]C,
regardless of vapor pressure. As such, a flammable liquid can ignite
and burn regardless of vapor pressure.
In addition to the HMR's basic framework, several commenters
opposed the establishment of a vapor pressure limit in consideration of
the already completed HM-251 rulemaking. The HM-251 rulemaking adopted
the DOT-117 tank car specification and other safety provisions that
were found to be protective of human health and the environment,
further strengthening the protections provided by the HMR. Commenters
such as RSI suggested that given recently adopted measures from the HM-
251 final rule, setting additional requirements at this time would be
premature and economically burdensome. Specifically, RSI noted that
PHMSA does not yet know the full effect of these regulatory efforts,
many of which have only been implemented within the last few years or
are still in the process of being implemented (i.e., the transition
from DOT-111 specification tank cars to DOT-117s and DOT-117Rs). As
such, RSI noted it would be premature to implement additional
regulations impacting the transportation of crude oil and other
flammable liquids by rail prior to full implementation of these
regulatory initiatives and before PHMSA can analyze and understand
their collective safety impact.
API stated that safety measures like the ones set forth in the HM-
251 rulemaking were simply a better option for minimizing safety risks
as compared to limiting vapor pressure to minimize safety risks. It
further stated that PHMSA should invest in and improve the methods to
transport crude oil safely, rather than impose new unilateral RVP
limits that may not reduce accidents or casualties and are not based on
any scientific evidence. A commenter from AWM Associates noted that the
issue appears to be related to shippers failing to properly classify
the Bakken crude oil and suggests that PHMSA should increase criminal
prosecution of shippers that fail to properly classify their hazardous
materials and those who ship the hazardous materials in unauthorized
containers.
[[Page 30678]]
II. Crude Oil Characterization Research Study (Sandia Study)
In addition to the ANPRM, DOT, the U.S. Department of Energy (DOE),
and Transport Canada (TC) have conducted a collaborative research
program designed to better understand the risks associated with large
volume rail transport of crude oil in general, particularly
unconventional (tight) oil. The research was carried out by Sandia, a
DOE Federally Funded Research and Development Center. As a Federally
Funded Research and Development Center, Sandia draws upon its deep
science and engineering experience and serves as an independent,
objective advisor to DOE and conducts research to inform the policy
debate for decision makers. To carry out the objectives of the Sandia
Study, DOE called upon a multidisciplinary team with world-class
experts and state-of-the-art facilities, instrumentation, and
diagnostic capabilities to perform complex large-scale combustion
testing and analysis.
A. Congressional Mandate
Section 7309 of the FAST Act requires the Secretaries of DOE and
DOT to submit a report to Congress on the results of the ongoing Sandia
study of crude oil characteristics within 180 days of its completion.
Now completed, the results of the Sandia Study are summarized in
Section B below.
B. Phases of the Sandia Study
i. Initial Phase
DOT and DOE began their effort by commissioning a review of
available crude oil chemical and physical property data and literature.
This review focused on crude oil's potential for ignition, combustion,
and explosion. A partial list of properties surveyed included density
(expressed as API gravity), vapor pressure, initial boiling point,
boiling point distribution, flash point, gas-oil ratio, and ``light
ends'' composition (dissolved gases--including nitrogen, carbon
dioxide, hydrogen sulfide, methane, ethane, and propane--and butanes
and other volatile liquids). Although the review yielded a large
database encompassing a wide variety of crude oils and their
properties, it also illustrated the difficulty in using available data
as the basis for accurately defining and comparing crude oils due to
the wide range in variability, specifically variability in the sample
point, sampling methods, and analytical methods.
An important outcome of the first phase of this research was formal
recognition of the wide-ranging variability in crude oil sample types,
sampling methods, and analytical methods and acknowledgement that these
variabilities limit the adequacy of the available crude oil property
data set for establishing effective and safe transport guidelines. To
address this characterization and classification gap, DOT, DOE, and TC
continued their research to improve the understanding of crude oil
properties with a particular focus on ``tight'' crude oil. A Sampling,
Analysis, and Experiment (SAE) plan was designed to characterize tight
and conventional crude oils based on key chemical and physical
properties, and identify properties that may contribute to increased
likelihood and/or severity of combustion events that could arise during
transport incidents. In addition to analytical procedures, this
research program included experiment activity protocols such as: Use of
acquired chemical and physical property data in the development of
computational models for predicting crude oil behavior in rail
transport accident scenarios; and execution of experimental activities,
including actual pool fires and fireballs, to validate and/or improve
predictive models. The Sandia Study, as initially proposed, comprised
four separate tasks, with an option to conduct additional Tasks 5 and 6
(proposing full scale combustion studies, and a comprehensive supply
chain oil properties survey, respectively) based on the results of
Tasks 1 through 4. Below, PHMSA describes Tasks 1 through 3 and the
basis for the determination by Study sponsors DOE, DOT, and TC that
Tasks 4-6 would no longer be necessary given the definitive results
from the completion of the first three tasks, which are more fully
described below.
ii. Task 1
Task 1 (Project Administration and Outreach) covered the initial
procurement of crude oil samples, testing materials, equipment, and
analytical lab contracts. It also included coordination and outreach
with sponsors, Steering Committees, technical associations, and subject
matter experts. Task 1 was ongoing throughout the study.
iii. Task 2
Task 2 (Sampling and Testing) investigated which commercially
available crude oil sampling and analysis methods can accurately and
reproducibly collect and analyze crude oils for vapor pressure and
composition, including dissolved gases. Results of Task 2 were
published on November 1, 2017 as SAND2017-12482. Revision 1--Winter
Sampling, published on June 1, 2018 as SAND2018-5909, incorporated
additional seasonal data and compositional analysis results that had
become available since publication of the initial report. Both reports
compared performance of commercially available methods to that of a
well-established mobile laboratory system that currently serves as the
baseline instrument system for the U.S. Strategic Petroleum Reserve
Crude Oil Vapor Pressure Program. The experimental matrix evaluated the
performance of selected methods for (i) capturing, transporting, and
delivering hydrocarbon fluid samples from the field to the analysis
laboratory, coupled with (ii) analyzing for properties related to
composition and volatility of the oil, including vapor pressure, gas-
oil ratio, and dissolved gases and light hydrocarbons. Several
combinations of sampling and testing were observed to perform well in
both summer and winter sampling environments, though conditions apply
that need to be considered carefully for given applications. Methods
that performed well from Task 2 were utilized subsequently in Task 3.
iv. Task 3
The purpose of Task 3 (Pool Fire and Fireball Experiments in
Support of the US DOE/DOT/TC Crude Oil Characterization Research Study)
was to compare combustion behavior of several crude oil types spanning
a measurable range of vapor pressure and light ends content
representative of U.S. domestic conventional and tight crude oils.
Results of Task 3 were published on August 24, 2019 as SAND2019-
9189.\3\
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\3\ Available at https://www.osti.gov/servlets/purl/1557808.
Task 3 results and conclusions were peer-reviewed by independent
fire experts and sampling and characterization subject matter
experts. See id. at 4. In addition, Task 3 results and conclusions
were reviewed by PHMSA, Federal Railroad Administration, DOE, and TC
scientists and engineers.
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Task 3 consisted of an experimental observation of physical,
chemical, and combustion characteristics of selected North American
crude oils:
The objective of the pool fire experiments was to measure
parameters necessary for thermal hazard evaluation (namely, burn rate,
surface emissive power, flame height, and heat flux to an engulfed
object) by a series of 2-meter diameter indoor and 5-meter diameter
outdoor experiments.
The objective of the fireball experiments was to measure
parameters required for thermal hazard evaluation (namely, fireball
maximum diameter, height at maximum diameter, duration,
[[Page 30679]]
and surface emissive power) using 400-gallons of crude oil per test.
Observed results were then extrapolated in calculating thermal
hazard distances resulting from full scale 30,000-gallon pool fires and
fireballs. The Sandia Study noted that the methodology described above
incorporated steady-state assumptions that would tend to overstate
calculated hazard distances.
The crude oil samples used for the experiments were obtained from
several U.S. locations, including ``tight'' oils from the Bakken region
of North Dakota and Permian region of Texas, and a conventionally
produced oil from the U.S. Strategic Petroleum Reserve stockpile. These
samples spanned a measurable range of vapor pressure (VPCRx(T)) and
light ends content representative of U.S. domestic conventional and
tight crude oils.
Task 3 demonstrated that, even though the three crude oils studied
had a wide range of vapor pressures, each had very similar calculated
thermal hazard distances with respect to pool fire and fireball
combustion. Furthermore, those crude oils evaluated in Task 3 were also
found to have thermal hazard parameters (surface emissive power, etc.)
consistent with the known thermal hazard parameters of a variety of
other alkane-based hydrocarbon liquids--some with higher vapor
pressures than any observed in the Sandia Study. Based on those data
points, the Sandia Study concluded that vapor pressure is not a
statistically significant factor in affecting the thermal hazard posed
by pool fire and fireball events that might occur during crude oil
train derailment scenarios. In sum, the Sandia Study demonstrated that
lowering the vapor pressure of crude oil would not reduce the severity
of pool fire or fireball scenarios, and concluded that results of the
study do not support creating a regulatory distinction for crude oils
based on vapor pressure.
v. Sandia Study Completion
The 2015 version of the SAE Plan for the Sandia Study framed the
project in terms of six tasks, the first four of which were authorized
by its sponsors. Task 4 was conceived as an opportunity to generate a
comprehensive data set of vapor pressures for multiple crude oil types
to better understand the thermal hazards for pool fires and fireballs.
The value of Task 4, therefore, was premised on the faulty assumption
that vapor pressure would be a significant factor determining the
magnitude of thermal hazards from pool fire and fireball hazards posed
by different crude oil types.
However, the relative independence of thermal hazards from vapor
pressure observed in Task 3 eliminated the need for additional data
that would have been collected in Task 4. Consequently, Sandia included
within the Task 3 conclusions a recommendation against proceeding with
Task 4.\4\ Subsequently, the Sandia Study sponsors (DOT, DOE, and TC)
agreed neither to proceed with Task 4 nor optional Tasks 5 and 6.
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\4\ Id. at 77-78. The full-scale combustion testing and supply
chain analysis contemplated in Tasks 5 and 6 were not pursued for
the same reason.
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III. PHMSA's Decision
PHMSA, after examining the results and conclusions of the Sandia
Study closely, and in consideration of the public comments to the ANPRM
from industry, stakeholders, and other interested parties, has
determined that issuing any regulation setting a vapor pressure limit
for crude oil transportation by rail is not justified because such a
regulation would not improve the safety of transporting crude oil by
rail. PHMSA further notes that the Sandia Study's finding that there
was no meaningful link between crude oil vapor pressures and thermal
hazards militates against the imposition of vapor pressure limits for
transportation of crude oil in modes other than rail.
Furthermore, establishing a vapor pressure limit for crude oil by
rail would unnecessarily impede rail transportation of crude oil
without providing justifiable benefits. As explained by comments
submitted in response to the ANPRM, vapor pressure limits on crude oil
transported by rail would, inter alia, disrupt commodity markets for
the dissolved gasses that drive crude oil vapor pressure, require
conforming changes to contractual and equipment specifications
throughout the value chain, and impose significant compliance costs on
crude oil producers and rail transportation. None of those significant
burdens, moreover, would be accompanied by a meaningful safety benefit.
Thus, this notice of withdrawal provides PHMSA's determination that no
regulation setting a vapor pressure limit for rail transportation of
crude oil is necessary or appropriate.
PHMSA also has decided, based on its review of comments to the
ANPRM and its existing regulations, against imposing vapor pressure
limits for other unrefined petroleum-based products and Class 3
flammable liquid hazardous materials by any mode.
The administrative record similarly did not evince a compelling
technical basis for imposing vapor pressure limits with respect to
transportation by any mode of other unrefined petroleum-based products
and Class 3 flammable liquid hazardous materials. As noted above, those
comments calling for broader vapor pressure limits were predicated
largely on anecdotal correlations or by way of analogy to vapor
pressure limits imposed on either chemically distinct hazardous
materials (e.g., refined petroleum products such as gasoline), or for
reasons not always related to transportation safety (e.g., pollution
control). PHMSA is therefore unconvinced those comments demonstrate
that regulation of unrefined petroleum-based products and Class 3
hazardous flammable liquid materials on the basis of vapor pressure
will result in meaningful safety improvements beyond those provided by
existing HMR classification requirements predicated on flammability and
initial boiling point. See 49 CFR 173.21(a). PHMSA further notes that
the significant compliance and opportunity costs identified in comments
submitted by diverse industry stakeholders also militate against
imposing vapor pressure limits on modal transportation of unrefined
petroleum-based products and Class 3 hazardous flammable liquid
materials.
Accordingly, PHMSA withdraws the January 18, 2017 ANPRM in its
entirety.
IV. Preemption of Non-Federal Laws
PHMSA, in issuing this withdrawal, has affirmatively determined
that a national vapor pressure limit for unrefined petroleum-based
products is not necessary or appropriate. As explained further below,
PHMSA believes that Federal law likely preempts any non-Federal law
that attempts to set a vapor pressure limit for these materials. PHMSA
is aware of two States that already have laws setting vapor pressure
limits in place for crude oil: North Dakota and Washington. PHMSA is
also aware of one State legislature that has introduced a similar bill
that would regulate vapor pressure for oil or gas.\5\ Moreover, six
additional States: California, Illinois, Maine, Maryland, New Jersey,
and New York have advocated for a vapor pressure limit.\6\
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\5\ See House Bill 4105, 80th Oregon Legislative Assembly--2020
Regular Session (February 3, 2020), https://olis.leg.state.or.us/liz/2020R1/Downloads/MeasureDocument/HB4105/Introduced (last visited
Apr. 1, 2020).
\6\ In this proceeding, the Attorneys General of California,
Illinois, Maine, and Maryland filed joint comments with the
Attorneys General of New York and Washington, supporting a national
vapor pressure standard. See Comments by the Attorneys General of
New York, California, Illinois, Maine, Maryland, & Washington,
Document Id: PHMSA-2016-0077-0074. In addition, the Attorneys
General of New York, California, Maryland, and New Jersey submitted
comments against preemption in a proceeding involving Washington's
law. See Docket No. PHMSA-2019-0149.
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[[Page 30680]]
The Federal hazmat law contains express preemption provisions
relevant to this proceeding. As amended by Section 1711(b) of the
Homeland Security Act of 2002 (Pub. L. 107-296, 116 Stat. 2319), 49
U.S.C. 5125(a) provides that a requirement of a State, political
subdivision of a State, or Indian tribe is preempted--unless the non-
Federal requirement is authorized by another Federal law or DOT grants
a waiver of preemption under section 5125(e)--if (1) complying with the
non-Federal requirement and the Federal requirement is not possible; or
(2) the non-Federal requirement, as applied and enforced, is an
obstacle to accomplishing and carrying out the Federal requirement.
Additionally, subsection (b)(1) of 49 U.S.C. 5125 provides that a
non-Federal requirement concerning any of five subjects is preempted
when the non-Federal requirement is not ``substantively the same as'' a
provision of Federal hazardous material transportation law, a
regulation prescribed under that law, or a hazardous materials security
regulation or directive issued by the Department of Homeland
Security.\7\ The ``designation, description, and classification of
hazardous material'' is a subject area covered under this authority. 49
U.S.C. 5125(b)(1)(A). To be ``substantively the same,'' the non-Federal
requirement must conform ``in every significant respect to the Federal
requirement. Editorial and other similar de minimis changes are
permitted.'' 49 CFR 107.202(d).
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\7\ Unless the non-Federal requirement is authorized by another
Federal law or DOT grants a waiver of preemption under section
5125(e).
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The preemption provisions in 49 U.S.C. 5125 reflect Congress's
long-standing view that a single body of uniform Federal regulations
promotes safety (including security) in the transportation of hazardous
materials. Some forty years ago, when considering the Hazardous
Materials Transportation Act, the Senate Commerce Committee
``endorse[d] the principle of preemption in order to preclude a
multiplicity of State and local regulations and the potential for
varying as well as conflicting regulations in the area of hazardous
materials transportation.'' S. Rep. No. 1192, 93rd Cong. 2nd Sess. 37
(1974). A United States Court of Appeals has found uniformity was the
``linchpin'' in the design of the Federal laws governing the
transportation of hazardous materials.\8\
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\8\ Colorado Pub. Util. Comm'n v. Harmon, 951 F.2d 1571, 1575
(10th Cir. 1991).
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The current HMR requirements for the classification of unrefined
petroleum-based products include proper classification, determination
of an appropriate packing group, and selection of a proper shipping
name. The HMR contain detailed rules that guide an offeror through each
of these steps to ensure proper classification of hazardous materials.
Moreover, for unrefined petroleum-based products, such as crude oil,
additional requirements were implemented pursuant to a public notice
and comment rulemaking proceeding.\9\ These Federal requirements for
classification of these types of materials do not mandate specific
sampling and testing of vapor pressure, nor do they classify hazardous
liquids based on vapor pressure. Moreover, there is no current Federal
requirement to pre-treat or condition crude oil to meet a vapor
pressure standard before it is offered for transportation.
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\9\ Hazardous Materials: Enhanced Tank Car Standards and
Operational Controls for High-Hazard Flammable Trains, 80 FR 26643
(May 8, 2015).
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Because the HMR does not designate, describe, or classify unrefined
petroleum-based products differently based on vapor pressure, any non-
Federal law setting a vapor pressure limit for such materials is likely
preempted by 49 U.S.C. 5125(b)(1)(A). Indeed, PHMSA has affirmatively
decided in this proceeding that a national vapor pressure limit is not
necessary or appropriate, thereby confirming that non-Federal laws
setting vapor pressure limits are likely not ``substantively the same''
as Federal law.\10\ Such non-Federal laws may also be ``handling''
regulations preempted by 49 U.S.C. 5125(b)(1)(B), and may also be
preempted under 49 U.S.C. 5125(a)(2) as obstacles to accomplishing and
carrying out Federal law.
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\10\ This notice of withdrawal also provides a basis for what
courts have referred to as ``negative'' or ``null'' preemption. See
Norfolk & W.R. Co. v. Pub. Utils. Comm., 926 F.2d 567, 570 (6th Cir.
1991) (``the United States Supreme Court has recognized a form of
negative preemption when a federal agency has determined that no
regulation is appropriate.'') (citing Ray v. Atlantic Richfield Co.,
435 U.S. 151, 178 (1978)).
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A person directly affected by a non-Federal requirement may apply
to PHMSA for a determination that the requirement is preempted by 49
U.S.C. 5125. See 49 U.S.C. 5125(d); 49 CFR 107.203-107.213. PHMSA is
currently considering a preemption application filed by North Dakota
and Montana with respect to Washington's vapor pressure limit, and will
consider any application filed with respect to other non-Federal vapor
pressure limits.
Issued in Washington, DC, on May 11, 2020, under authority
delegated in 49 CFR part 1.97.
Howard R. Elliott,
Administrator, Pipeline and Hazardous Materials Safety Administration.
[FR Doc. 2020-10377 Filed 5-19-20; 8:45 am]
BILLING CODE 4910-60-P