January 15,

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1 RAIL SHIPPING 2015: Tank Car Safety January 15, 2015 Pipeline and Hazardous Materials Safety Administration Timothy P. Butters, Acting Administrator *The information in this presentation may change. As of January 15, 2015, the content reflected current DOT data and actions. Please do not edit or alter this presentation. Please do not further distribute without notice to PHMSA*

2 ABOUT PHMSA Safety is top priority Mission: To protect people and the environment from the risks inherent in the transportation of hazardous materials Sets, enforces & updates hazmat transportation safety regulations

3 U.S. ENERGY PRODUCTION Growth of domestic natural gas and crude oil production is revolutionizing the U.S. energy economy. In 2013, the Bakken play produced over 10% of all US oil. As of June 2014, Bakken oil wells produced over 1.1M barrels/ day.

4 Trains Moving 1M+ Gallons of Bakken per Week The volume of crude oil moving by rail has quadrupled in less than a decade.

5 RAIL SAFETY RECORD Rail volume has increased, but accidents have declined. Over the past 25 years, the risk of all major hazmat transportation incidents have decreased by 4% every three years. More Energy Transportation = More Risk Prevent. Mitigate. Prepare.

6 RECENT DERAILMENTS Lynchburg, VA April 30, of 105 cars of Bakken oil unit trains derailed Plaster Rock, NB (Canada) January 7, cars derailed, 8 were carried hazmat Casselton, ND December 20, of 106 crude oil tank cars derailed; November 13, 2014 Aliceville, AL November 8, of 90 crude oil tank cars derailed Lac-Megantic, QE (Canada) July 6, cars derailed of runaway train, resulting in 47 fatalities

7 USDOT ACTIONS Emergency Orders Railroads must properly secure rolling equipment Shippers must properly analyze and classify oil prior to transportation Railroads required to provide states with information about Bakken crude oil transported by rail

8 Safety Advisories USDOT ACTIONS Railroads should take additional action to eliminate risk Importance of proper characterization, classification, and selection of a packing group for Class 3 materials Bakken crude oil may be more flammable than traditional heavy crude oil Shippers and carriers should take all possible steps to avoid the use of DOT 111 tank cars when transporting Bakken crude oil

9 RULEMAKINGS Proposed Rules [PHMSA (HM-251] Improvements to rail operational procedures, options for improved tank car. [FRA ] Securement of unattended equipment, and train crew staffing and location. Advanced Notice of Proposed Rulemaking PHMSA (HM- 251B) - Expanding comprehensive oil spill response planning requirements for shipments of flammable materials.

10 SAFE TRANSPORTATION OF ENERGY PRODUCTS (STEP) USDOT S comprehensive approach to preventing derailments, reducing derailment consequences, and preparing communities and first responders. Aggressive USDOT Actions Proposing stronger safety regulations Hazmat testing and analysis Unannounced inspections and tougher enforcement Leveraging partnerships Public outreach Improving emergency preparedness and response Voluntary actions by shippers & carriers

11 INDUSTRY ACTIONS Railroads committed to: Speed restrictions; Braking enhancements; Make more frequent rail and mechanical inspections; Install wayside defective bearing detection equipment; Provide resources to enhance emergency response capabilities and community awareness along crude oil routes; and Use the Rail Corridor Risk Management System.

12 INDUSTRY ACTIONS American Petroleum Institute (API) Develop a comprehensive standard for testing, classification, loading and unloading of crude oil based on the best available science and data; Share information and expertise; Participate in efforts to improve tank car design; and Work with the railroads to enhance emergency response training.

13 CALL TO ACTION Conduct primary and alternative route analyses every year. Voluntarily reduce crude oil train speeds to 40 miles-perhour, especially when passing towns Install advanced accident detection and braking technology Execute additional internal track inspections on a yearly basis. Allocate funds for emergency response training curricula. Work directly with states, towns and Tribes to hear and address their unique concerns.

14 RECAP Energy production is still growing The safe transportation of energy products is a joint government and industry effort PHMSA and FRA have undertaken more than two dozen actions to enhance the safe transport of crude oil since December 2012

15 RECAP The railroad and petroleum industries committed to responding to Secretary Foxx s Call to Action on crude oil by rail safety. Please continue taking action to improve rail safety.

16 STAY CONNECTED Safely Transporting Energy Products (STEP) Hub Updates on industry commitments as part of the Call to Action and additional Departmental activities related to the rail safety initiative.

17 THANK YOU Timothy P. Butters, Acting Administrator Pipeline and Hazardous Materials Safety Administration