Minnesotans seek two-year moratorium on frac sand mining

More than 6,000 residents of southeastern Minnesota signed a petition to enact a two-year moratorium on frac sand mining, declaring that “southeast Minnesota should be off-limits to the frac sand industry” in order to protect air and water quality. The Land Stewardship Project, the group sponsoring the petition, asserted that the governor had the authority to order the Environmental Quality Board to issue a moratorium under the state’s Critical Areas Act without legislation because the frac sand operations were threatening ecologically sensitive areas.

The petition was presented to the state’s governor on April 22, 2014, during Earth Day celebrations.

Governor Mark Dayton responded that, while he would “like to ban it [frac sand mining] entirely” because he believes that “the environmental risks are far greater than the economic benefits in terms of jobs and economic benefits for the area, but that’s not the law.” State legislators in 2013 decided against a state-wide ban. Stating that legal counsel advised him that he did not have the authority to unilaterally impose a moratorium, the governor reminded the citizens that “local jurisdictions, such as counties, cities, and townships, have authority under existing Minnesota Statutes to declare moratoriums on frac sand mining and processing within their jurisdictions.”

A poll taken in February 2014 showed that 64% of Minnesotans favor the two-year moratorium while 31% oppose the moratorium and 52% oppose increased frac sand mining in the state. Undoubtedly frac sand mining will continue to be a contentious issue among the citizens of Minnesota.

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This post was written by Barclay Nicholson (barclay.nicholson@nortonrosefulbright.com or 713.651.3662) from Norton Rose Fulbright's Energy Practice Group.

U.S. Department of Transportation meets with oil and rail industry leaders to discuss transport safety issues

With the recent December 30, 2013 derailment of tanker cars carrying oil in Casselton, North Dakota, as well as other 2013 incidents  in western Minnesota, Baltimore, Alabama, and at three sites in Canada (Gainfield, Landis, and Lac-Mégantic, where 47 people were killed when  an unattended 72-car freight train derailed in the center of town), the U.S. Department of Transportation (DOT) met with representatives from the oil and railroad industries to discuss transport safety issues relating to crude oil. 

At the meeting on January 15, 2014, representatives from the American Petroleum Institute (API) and the Association of American Railroads (AAR) reportedly agreed to take steps to avoid derailments, to work on a speed reduction plan, and to re-route trains around high-risk areas. According to the AAR representative, 27 risk factors, including population density, volume of hazardous materials being transported, and traffic density,  are always considered when routing trains. The API representative stressed the importance of having strong rail cars to transport the crude oil. 

On September 6, 2013, in the Federal Register, the Pipeline and Hazardous Materials Safety Administration (PHMSA) published a proposed rule concerning “Hazardous Materials: Rail Petitions and Recommendations to Improve the Safety of Railroad Tank Car Transportation (RRR).This proposed rule would impose additional requirements  for DOT Specification 111 tank cars used to transport Packing Group (PG) I and II hazardous materials. PHMSA has indicated that the proposed rule relating to the construction of rail tanker cars will not be finalized until at least January 2015.

With the volume of produced oil rising faster than can be moved by pipeline, railroads are being used more and more to transport oil products to processing facilities – and with that increase, come increasing concerns about the safety of transporting crude oil by rail.

In early January,  PHMSA and the Federal Railroad Administration issued a safety alert “to notify the general public, emergency responders, and shippers and carriers that recent derailments and resulting fires indicate that the type of crude oil being transported from the Bakken region may be more flammable than traditional heavy crude oil.”  For additional information, see our prior blog entitled “Safety alert relating to flammability of North Dakota Bakken crude oil transported by rail.”

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This post was written by Barclay Nicholson (barclay.nicholson@nortonrosefulbright.com or 713.651.3662) from Norton Rose Fulbright's Energy Practice Group.