The Trump administration is considering a proposal to move fracked gas by rail at the behest of a company owned by Milwaukee Bucks billionaire owner Wes Edens, a major donor to the DNC. As tar sands pipelines are halted, more carbon-intensive crude moves along the tracks.
Story Transcript
DIMITRI LASCARIS: This is Dimitri Lascaris reporting for The Real News Network from Montreal, Canada.
The Trump administration has advanced a regulatory proposal to ship liquified natural gas, or LNG, by rail. Under the auspices of PHMSA or the Pipeline and Hazardous Materials Safety Administration, the federal agency is considering a proposal by the company Energy Transport Solutions to reverse the current ban on carrying LNG on the tracks. Democratic U.S. Representative Peter DeFazio, in response, recently proposed a bill entitled Protecting Communities from Liquified Natural Gas Trains Act. It calls for more in-depth federal agency study of the risks associated with carrying the substance by rail.
In response to the Trump administration’s proposed rule, DeFazio issued a press release stating, “Implementing reckless plans for special interests has been a hallmark of the Trump administration, and that results of his order could be catastrophic.” A final decision on LNG by rail looms in the months ahead, coming as the Trump administration’s Federal Energy Regulatory Commission, or FERC, just issued a green light on four export terminal permits at a November 21st hearing. Energy Transport Solutions is owned by Milwaukee Bucks owner and DNC donor, Wes Edens, and the company has plans to move the LNG by rail, particularly in and around the state of Florida, and then ship it to places such as Jamaica, Puerto Rico, and Ireland.
Joining us for part two of an interview series about the connection between the fossil fuels industry and big rail is Justin Mikulka. He is writer for the website DeSmog.com, which investigates the climate change denial machine and fossil fuel industry misinformation. He is also the author of the recently released book Bomb Trains: How Industry, Greed and Regulatory Failure Put the Public at Risk. Thanks for joining us again on The Real News, Justin.
JUSTIN MIKULKA: Oh, thanks for having me.
DIMITRI LASCARIS: So Justin, I’d like to start by asking to drill down on what the Trump administration is proposing here. You recently talked about it in a piece titled Trump Administration Proposes New Rule to Allow Shipping Flammable and LNG by Rail. How long has this new regulatory proposal been in the works? And please tell us a little bit more about the concerns that you think the public ought to have about the proposal.
JUSTIN MIKULKA: Yeah. So moving LNG by rail has been something that the rail industry’s been interested in for a few years, and they’ve been lobbying for it, but it really was going nowhere, I think partially because of the concerns that were very apparent about moving, and the risks of moving oil and ethanol by rail. But with the Trump administration coming in, what happened was actually pretty unusual beginning of last year. Via an executive order, President Trump said he wanted a regulation in place to allow LNG by rail by early 2020. That isn’t normally how regulations are put into place. And so that’s the situation we’re in. And as you mentioned, it could be in the next couple of months this is approved.
As I mentioned in that article, they’re not proposing any new safety regulations, not requiring modernized brakes for these trains, not putting any limitations, so far, on the length of the trains. So there are a lot of risks, things we know are real risks based on what we’ve learned from them moving flammable oil by rail. But the potential explosion and risks of LNG containers, if they breach in a populated area, unfortunately could probably make the oil by rail disasters look like small change.
DIMITRI LASCARIS: Now this is happening of course as the United States is exporting record amounts of LNG to the global market under the Trump administration. Though to be fair, the export boom for LNG got off the ground and running in a major way under Obama’s tenure. Please talk to us about the global demand for U.S. LNG and the way in which it’s obtained. Is this a replacement, in particular, this method of transporting LNG for pipelines, or is it an ancillary way to move the substance and to supplement the current distribution network?
JUSTIN MIKULKA: Well, the one thing to understand about LNG is it’s liquified natural gas, but the way it’s liquified is it’s very cold. It’s close to 300 degrees below zero centigrade. And so, this isn’t something you can move by pipelines. It has to be moved in these containers that can hold that sort of low temperature, and also then loaded onto ships when it’s exported, these special ships, that also are able to maintain it in that liquified state, in the very cold state. So that’s one of the reasons why rail is so appealing right now to the U.S. natural gas industry. There is far too much natural gas in this country because of the fracking. A lot of natural gas is produced when they frack oil, and there’s just too much of it. In places like Texas, at certain times this year, they were actually paying people to take natural gas away. So the price went negative. So that’s clearly not a sustainable business model.
And so what the fracking industry and the national gas industry in the U.S. is looking to, is sell it to the world. And there certainly is a big demand in India and China and throughout the world for natural gas. But the problem is getting that natural gas from where it’s produced in the U.S. to deep water ports, where they can load it onto these special ships. And it’s one of the things that the fossil fuel industry loves about the rail industry. Pipelines don’t go everywhere. They’re very expensive, and it takes a long time to build new pipelines. So if you want to get your oil or your natural gas from somewhere in the middle of the country to the West Coast, trains are an excellent option. So trains offer the flexibility to get products to deep water ports, and they can move this liquified natural gas at these very cold temperatures.
DIMITRI LASCARIS: So let’s transition a bit to another kind of fossil fuel, one of the more viscous variety, extracted from the country where I live, Canada, and that is the tar sands in Alberta. Real News viewers may be familiar with various tar sands carrying pipeline battles, including the high profile fights over Keystone XL Energy East and the Trans Mountain Pipelines. Flying a bit below the surface, however, is that huge amounts of tar sands bitumen is being carried by rail in Canada and in the United States, even as pipeline projects face various impediments. Please talk to us about what is taking place in terms of the transport of bitumen by rail in Canada and the United States, and where in particular are those trains mostly heading?
JUSTIN MIKULKA: Yeah, so you’re correct. The Canadian rail industry has greatly increased the amount of tar sands oil or bitumen it’s been moving in the past several years. We’re near record levels right now. There are a couple of issues going on with Canadian Rail right now. There’s a major strike that’s stopping some of this oil moving right now. But the long-term plans for the industry, in Alberta, specifically, are to use rail in a much greater capacity to move tar sands oil.
The majority of that oil goes to the U.S., where it either hits refineries, some in the Midwest, but most of it is going to the Gulf Coast and into refineries across the U.S. It’s also a way to export the oil as well. And, as you know, the Canadian oil industry needs to export its product to the world to continue operating. That’s their main goal. And so again, rail offers the opportunity to get to ports, so it’s ideal connection to help you export, because pipelines don’t necessarily go to ports. So that’s one of the real advantages of rail for Canadian tar sands industry. So they are definitely… They’re looking to ramp up the volumes, but the majority of that passes through Canada and then goes to the U.S.
DIMITRI LASCARIS: And let’s talk about the safety aspects of this back in oil, like LNG, are known for their chemical volatility. How do the risks arising from the transportation by rail of tar sands bitumen compare to the risks associated with oil by rail and now LNG by rail?
JUSTIN MIKULKA: Well, the way they current move of the tar sands by rail is diluting bitumen with a highly volatile petroleum product called condensate, which comes out of the ground out of fracked wells. And so what they’re doing is bringing condensate to Alberta, mixing it with the tar sands oil, or the bitumen, to make it a lighter pumpable oil, which they then can pump into rail cars or into pipelines.
So this diluted bitumen, or dilbit as it’s called, also has a very volatile component of the condensate or whatever they’re using to dilute it. And we saw that in the first two tar sands trains that derailed and crashed, caught fire, exploded, and burned for days, just like the Bakken oil trains had done. So when you’re moving the tar sand in the form of diluted bitumen, it can be very volatile, explosive, and dangerous, just like the fracked oil. And so there are very similar risks, exposure risks, risks to the people living along the community from tar sands oil as there are from us fracked oil.
DIMITRI LASCARIS: And finally, Justin, let’s talk about the elephant in the room: climate change. We haven’t touched upon that. You wrote in your most recent piece that the rail industry actually faces some of its own unique dangers from the impacts of climate change. Please talk about those dangers and what it means for this industry to be carrying so much oil, gas, and even a bit of coal to market, in terms of the climate crisis and how that’s going to affect the rail industry.
JUSTIN MIKULKA: Yeah. I mean, clearly there are many industries that are at risk from climate change, but the rail industry is facing several challenges that are already happening. Just a week or two ago, the manager of the rail industry in Scotland pointed out that climate change is having a real impact now. And there are two real ways that climate change is impacting rail. One is that extreme temperatures are not good for steel rails. And so there are instances in the U.S., but also in the huge heatwave in Europe this summer, where the rails will just buckle, because they’re not designed for those high heats. Or they have to really slow down the trains because of the heat.
So that’s one aspect, where as the global temperature continues to warm, the industry is looking at having to replace all of that steel with steel that’s rated for higher temperatures, which is clearly a huge investment that would be required. One characteristic of the rail industry is railroads are built along waterways due to the favorable topography. And so, rails that are certainly along the oceanfront are facing sea level rise risk. That is very apparent in the Northeastern U.S., where the most highly trafficked section of rail from Boston to DC is right along the coast, and is very at risk of flooding and climate change impacts in the future. Beyond that there are just extreme weather events with flooded tracks and washout of rail beds. They’re another risk they’re facing.
So the rail industry has a lot of potential risks. Meanwhile, they’ve been, for decades, supporting climate denial and clearly moving products that are adding to the problem. So whereas the rail industry has been put out, and really has potential as a cleaner and greener form of energy, especially if it’s electrified, it hasn’t really taken up on that opportunity, and instead has doubled down on fossil fuel customers and climate denial.
DIMITRI LASCARIS: Well, we’ve been speaking to Justin Mikulka of DeSmog.com about the relationship between the rail industry, the oil industry, and climate change denialism. Thank you very much for joining us today on The Real News, Justin.
JUSTIN MIKULKA: Thanks so much for having me.
DIMITRI LASCARIS: And this is Dimitri Lascaris reporting from Montreal, Canada.
Studio: Adam Coley, Bababtunde Ogunfolaju
Production: Dimitri Lascaris, Steve Horn
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