One of the ancillary benefits associated with the energy boom in the United States is the increase in business experienced by many of the energy industry’s subsidiaries. One such industry are America’s railroads, which have experienced a gigantic influx in business because of the their ability to transfer oil, gas, sand, and a multitude of other equipment quickly and efficiently.(Image courtesy of Croatian Railways).
For example, in Texas’ Eagle Ford shale region, four major railroad terminals have opened in the last two years. This sharp influx in business is mainly attributable to the railroad’s ability to transfer crude oil and gas to locations where the pipelines either do not reach or the necessary infrastructure does not exist. This has been especially valuable to areas like the Bakken Shale Play in North Dakota, where railroads have allowed crude oil shipments to reach a larger number of refining centers and markets.
But the railroads aren’t just being used to transport crude oil and natural gas. The Eagle Ford Shale Play, the most recent rail yard to open, is focused entirely on the transportation and supply of sand for the hydraulic fracturing process. In hydraulic fracturing, sand is used not only to fracture the shale miles below the surface of the ground, but also to hold those fractures open so that the natural gas that escapes from the shale can flow back up the well bore and be harvested at the wellhead.
The railroad is also becoming more important in the Marcellus and Utica shale plays. Energy giant Markwest Energy Partners is in the process of growing its pipeline and processing network, but has stated that it see the railways playing a major role in natural gas distribution.
However, this increase in railway traffic has also led to an increase in rail-related accidents. In 2013 alone there were a number of railroad accidents involving flammable liquids, including incidents in Illinois, North Dakota, and Canada.
But these accidents have not been ignored. Just as the growing prominence of hydraulic fracturing has led to an increase in safety and environmental regulation relating to energy production, the same is true for the rail industry. Progress can rarely be achieved without encountering a few bumps in the road, but what is truly important is how those bumps are handled. Perhaps taking cues from the energy industry, the rail yards have been revisiting their safety and environmental protocols to ensure that when accidents occur – because they are inevitable regardless of the precautions taken – the consequences will be far less serious than in the past.
For example, after a recent train derailment in Philadelphia spilled a large quantity of crude oil into a nearby river, the National Transportation Safety Board (NTSB) recommended strict new safety measures for transporting crude oil by rail. The NTSB Chairman Deborah A.P. Hersman has acknowledged that the large-scale shipment of crude oil by rail did not exist ten years ago, and that “safety regulations need to catch up with this new reality” because “people and the environment along rail corridors must be protected from harm.”