The following appears in the September 2020 issue of The PIOGA Press.

By Joyce Turkaly,
Director of Natural Gas Market Development

The history and safety of transporting cryogenic liquids via rail was the subject of September’s New Project Subcommittee call. We have all questioned the rationale behind the recent news of multiple attorneys general questioning the safety protocols and unfounded risks to transport liquified natural gas (LNG) via rail, so we reached out to Scott Nason at Chart, Inc. for clarity. For the past 50 years, Chart has been a leader in the DOT-113 design, engineering cryogenic equipment for the hydrocarbon, industrial gas biomedical markets. Scott is an Application Development Manager, Rail & ISO Markets, for Chart and was invited to speak.

On June 19, the U.S. Department of Transportation (DOT) and the Pipeline and Hazardous Materials Safety Administration (PHMSA) in consultation with the Federal Railroad Administration (FRA) issued a final rule authorizing the bulk transportation of LNG via rail. The rule will permit the bulk transportation of LNG in DOT-113210W specification tank cars with enhanced outer tank requirements and additional operational controls. PHMSA-2018-0025 on the website. The rule was published in the July 24 Federal Register and took effect August 24. Publication of the rule complies with Executive Order 13868 Promoting Energy Infrastructure and Economic Growth issued in April 2019.

The tank car that has been approved is the DOT-113C1209 The “9” designates the enhanced outer tank thickness requirements of 9/16 inch as well as additional operational controls that include telemetry to enable tracking and pressure monitoring.

Scott described the design of the LNG tank cars and ISO containers as a thermos design. While the ISO design has been around a long time, the tender design is new. What they have in common is a thermos bottle type of storage tank that is the inner pressure vessel made from stainless steel that stores the liquid suspended within an outer tank with vacuum cold insulating material between the two tanks. The ISO design lends itself better for water transportation.

Scott also has experience with fuel tenders and has worked with companies like Union Pacific on the same “thermos” bottle design since the early 1990s. Transporting cryogenic liquids by rail is “nothing new under the sun,” he said. Argon is the most common product to move by rail today followed by liquid ethylene; granted that 98 percent of North America’s liquid ethylene moves by pipeline, there are niche market that are served via rail since 2015. Transportation of cryogenic liquids such as nitrogen, oxygen and hydrogen has been happening since the early 1960s. Today, LNG tenders for locomotives are an emerging product. The fuel tender business was resurrected in 2012 with the prototype programs producing good results. Any diesel engine can be converted to dual fuel. Today, substitution rates are as high as 80 percent in place of diesel in a typical duty cycle; the additional benefits are a cleaner burning fuel and cost savings. For the same amount of horsepower, you design with a multiplier of 1.6 gallons of LNG per 1 gallon of diesel.

Looking at one of Scott’s timeline slides, transporting LNG via rail was discussed as early as 2012. Transport Canada has been moving LNG via rail since 2014. Our federal government and the American Association of Railroads (AAR) held many meetings that were formally requested by AAR. With no established regulations, every request to move LNG was done via a special permit. With the rulemaking underway, the process was expedited in April 2019 because of Executive Order 13868 to accomplish it in 13 months. In parallel there was a special permit process related to the New Fortress project in Wyalusing, Pennsylvania. In October 2019 New Fortress received the special permit allowing essentially the same rail cars, Meanwhile, the federal process for nationwide rulemaking carried on to completion.

PIOGA supported the PHMSA proposed rulemaking for moving LNG by rail by writing a letter of support on behalf of our members. LNG is a cryogenic fuel, and federal regulations already allow for the safe shipment of other cryogenic liquids by rail tank cars. This rulemaking would therefore subject LNG to the same regulations and safety procedures already in place for ethylene and other cryogenic liquids. PIOGA therefore supports PHMSA’s determination in the special permit docket that shipment of LNG in DOT-113C120W tank cars is “an acceptable packaging to transport Methane, refrigerated liquid (LNG) by rail,” and believes that determination applies equally to all DOT-113 rail tank cars.

We believe that this rule would increase access to end use markets and provide our members and the public with important and significant benefits, not to mention a new market for the rail industry. Allowing LNG shipments by rail in DOT-approved tank cars will provide energy producers with increased flexibility by allowing them to select the transportation method that is the most economic and desirable based on the pertinent circumstances while maintaining rail public health and safety protections, and providing increased health and safety protections compared to truck shipments. The market for rail is anticipated to displace some trucking; one rail car net commodity equals three truckloads. Business opportunities for LNG via rail is cost effective and the market is more substantial given this news as North American rail expands into Mexico and Canada.

An ad-hoc committee originating from the Market Development Committee intends to create a fact sheet on LNG via rail for our members. This information and collaboration will be forthcoming.

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