Oil, coal, gas: Export proposals are growing

In the rush to ship energy to Asia from Washington and Oregon, more fossil fuels are being pushed.
Tanker cars can carry oil or LPG.

Tanker cars can carry oil or LPG. Paul K. Anderson, Chuckanut Conservancy

The Big Energy Export Train aimed at Pacific Northwest deep-water harbors is looking to add a new cargo: liquefied petroleum gas (LPG), also known as propane and butane.

The new export LPG cargo would be added to a menu that includes coal from the Powder River Basin of Wyoming and Montana; crude oil from the Bakken fields of North Dakota; and liquefied natural gas (LNG) from . . . well, you get the idea.

Petrogas, a Calgary-based energy company, plans to upgrade a small export terminal at Cherry Point in Whatcom County, near a proposed coal-export terminal and two oil refineries. The facility has had several owners since 1976 and has exported a small amount of LPG to Ecuador and Asia.

A Texas energy company, Sage Midstream, has announced plans for a new LPG export terminal at Longview; the site is near a proposed coal-export terminal, Millennium Bulk Products.

At least two proposals for liquefied natural gas terminals are on the table in Oregon: a longstanding one at Astoria near the mouth of the Columbia and a newer one at Coos Bay on the southern Oregon Coast. The Coos Bay project would include a 232-mile-long pipeline from south-central Oregon.

A little technical explanation: Natural gas is drilled from deep underground rock formations and liquefied natural gas is natural gas that has been converted to liquefied form for ease of transportation or storage; liquefied petroleum gas is largely captured from the waste of petroleum refineries (flaring). Natural gas is composed of methane and ethane, LPG from propane and butane. Both are explosive if exposed to fire or ignition.

Petrogas included few details in its Cherry Point announcement, and officials declined our request for an interview. But officials of Sage’s subsidiary, Haven Energy, were quick to address rail-transportation safety issues. Haven President Greg Bowles told the Longview Daily News that butane and propane would be shipped in the modern DOT-112 rail tank cars, which are built to a higher standard than the DOT-111 cars used to ship crude oil.

The most serious LPG accident in recent years killed 17 people in Viareggio on the Tuscan Riviera in Italy in 2009. The derailment of a 14-car LPG train caused an explosion and also forced the evacuation of 1,000 people, the New York Times reported.  In 2013, a derailment in Alberta caused an explosion and fire but no injuries, Reuters reported; one LPG car exploded and three others caught fire.

Industry sources defend the safety of LPG, and stress training to prevent accidents in transportation or use. ProActive Gas Safety, a consulting firm, termed the Italy explosion “extremely rare.” The Federal Railroad Administration in 2012 issued new safety rules for LPG. The proposed LPG terminals are relatively small compared to several crude-oil terminals proposed in the Northwest; at most it appears that a train or two per day (full and then empty for returning) would serve each terminal.

The $275 million Longview facility promises up to 125 permanent jobs and many more construction jobs; it would open in 2016. The key agency is likely to be the state Energy Facility Site Evaluation Council (EFSEC), which reviews large energy projects. The agency is now reviewing the Vancouver crude-oil terminal and beginning an Environmental Impact Study (EIS) similar to those being conducted by state, federal and local agencies for the coal-terminal proposals. Haven has been instructed to check with EFSEC, but the agency has yet to receive an inquiry, Manager Stephen Posner told Crosscut. Until he receives an inquiry he cannot determine if the project meets the criteria for EFSEC review. The little-known agency will depend heavily on other agencies to meet the crush of energy-export proposals, but Posner said he feels it can handle the load.

EFSEC is currently reviewing a large crude oil-export terminal at Vancouver on the Columbia River; an international consulting firm with office in Seattle and Portland, Cardno Etrix, will lead the environmental review for EFSEC. Ultimately, recommendations from the agency go to Gov. Jay Inslee for a final decision.


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Comments:

Posted Thu, Apr 17, 8:26 a.m. Inappropriate

The author repeatedly refers to the Port of Vancouver facility as an "export" terminal, which is incorrect. It's purpose is to more efficiently provide North American crude oil to West Coast U.S. refineries, not foreign countries. In fact this crude would displace about 30% for foreign imported crude that now comes from politically unstable and not exactly U.S.-friendly places like Russia, Iraq and Northern Africa.

Posted Thu, Apr 17, 8:41 a.m. Inappropriate

Good catch; as I note in the story, exports of U.S. crude are barred, with some exceptions, unless Congress changes the law. The Vancouver port would likely use barges to supply area refineries and barges or ships to supply California refineries. The other proposals are export terminals, coal and now perhaps LPG and LPG.

Posted Thu, Apr 17, 9:54 a.m. Inappropriate

Arthurking...perhaps you can help clear this up for me....The huge debate over exporting coal and other fossil fuels has been front and center for those of us concerned with our environment here in Wa. state. The Port of Vanc. and Cherry Point come to mind when I refer to this and I wonder - are there separate plans for these ports or are is the wool being drawn over our eyes (again)?
According to you, the P of V is for IMPORT, not export but I seem to remember a recent protest regarding this port and it's business in the EXPORT dept...? Can you clear this up for us? Where are they planning to export the Tar sands and Baalken oils from? I have seen hundreds of rail cars clearly declaring their content (Canadian Oil)on the Tacoma Harbor roads and assumed they were headed westward as the media keeps telling us. Thanks!

Posted Thu, Apr 17, 12:12 p.m. Inappropriate

The Vancouver Port will handle Bakken crude, from North Dakota. That crude will replace foreign imports. There are no plans to increase refinery capacity, so this is a carbon neutral proposition -- it simply replaces unstable (both politically and financially) foreign sources of oil with crude oil from Bakken. The State of Washington alone (businesses, cars, airplanes, government, etc.) consumes about 4.7 billion gallons of petroleum products every year. We are #8 in the country in consumption of jet fuel. The crude will find it's way here, one way or the other.

The Vancouver project provides the most efficient, direct route from North Dakota. Without it you can expect more oil trains to smaller projects scattered in other places like Grays Harbor County, without the high-grade infrastructure or rail improvements being made to serve Vancouver, because those projects can get approved without EFSEC scrutiny -- their smaller size means they only need local permits.

Posted Thu, Apr 17, 1:52 p.m. Inappropriate

I don't think it's accurate to characterize the Tesoro/Savage proposal at the Port of Vancouver as carbon neutral or solely for domestic consumption. Here are a few reasons for being skeptical:

1. It will be scaled to handle up to 360,000 barrels/day, which is a a very large volume in the context of NW or even West Coast refining capacity. Plus, it's only one of roughly a dozen oil-by-rail schemes in Oregon and Washington that together will move well in excess of 800,000 barrels/day. That's actually more crude than the region can refine even if you deleted all other sources of crude including the two current principal sources, Alaskan by vessel and Canadian by pipeline.

2. That project is configured with steaming heating equipment, which will enable it to handle heavier crudes, very much including Canadian tar sands. Oil from Canada is not subject to the "ban" on US crude exports.

3. The oil industry is actively lobbying Congress to lift the current "ban" (actually a licensing restriction) on US crude. Shipping it to Asia from the NW is arguably the most economic plan for the domestic oil industry because it is the shortest route in terms of rail haulage and vessel transit.

4. It doesn't quite make sense from a cost perspective to use the Port of Vancouver to ship large scale crude to domestic refineries. For one thing, you have to handle it, load it onto barges or vessels, then handle it again as its unloaded into a refinery. That adds up. And it's especially odd in light of the fact that every single NW refinery has it's own oil-by-rail project either operating or in permitting now, as do many in California.

5. The project proponents, Tesoro, are not exactly known for their sterling reputation for truth-telling. I wouldn't put a lot of stock into what they are saying in their marketing materials.

Posted Fri, Apr 18, 10:08 p.m. Inappropriate

I am wondering if the recent political context for the imports of LNG has been left out. Clearly we now have LNG contracts with Asia; specifically a desperate Japan. But plug 'LNG exports FTA DOE' or look at http://en.wikipedia.org/wiki/Jordan_Cove_Energy_Project and you can see what is going on. The "new cold war" between Russia and the U.S. is facilitating the rapid DOE approval of all LNG export terminals on U.S. coasts for non FTA nations. This is the U.S. flexing its "shale gas" muscle. New pipelines have been built, are being proposed to be built, and will be built. We intend to export not just LPG (a small market by comparison) and LNG but also Bakken, Eagleford, etc crude. What you are looking at right now with oil trains is simply the stopgap beginning of trillions of export $$$$. Personally, I suspect if any developed countries attempt to circumvent becoming dependent on U.S. energy exports in the future, they too will find their reactors exploding after being subject to mysteriously devastating natural events.

rferrisx

Posted Sat, Apr 19, 12:22 p.m. Inappropriate

I don't know what FTA refers to but there has been considerable talk about exporting LNG to Europe to replace their imports from Russia. This seems like a very risky investment because the cost of shipping LNG will make the entire enterprise uneconomic should Russia relent in its foreign policy and simply uses existing pipelines to once again market its gas in both Eastern and Western Europe. The LNG ports and ships and pipelines would be at a gruesome cost disadvantage.

kieth

Posted Sat, Apr 19, 7:58 p.m. Inappropriate

The article concludes: "an international consulting firm with office in Seattle and Portland, Cardno Etrix, will lead the environmental review for EFSEC."

These are the same clowns Obama hired to do the analysis for the Keystone Pipeline, Gateway Cherry Point Coal Terminal, and the BP Cherry Point refinery dock expansion. The latter has not had an EIS produced for 8 years since the 9th Circuit Court of Appeals directed them to.

This does not bode well for the judgement of the EFSEC panel nor of the recommendations the Governor will be receiving.

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