"After Recent Explosions, North Dakota Oil Shares Take A Hit"
CREDIT: ASSOCIATED PRESS
After a string of uncommon crude oil train explosions, investors are taking note that North Dakota’s oil may be more dangerous than most. Shares of several North Dakota’s major oil drillers dropped sharply Thursday as the U.S. government warned that crude oil from the state’s Bakken shale may be extra flammable.
Residents of Casselton, ND, were forced to evacuate Monday when 18 cars of a BNSF Railway train went off the rails, and burned perhaps due to a broken axle. Typically, crude oil doesn’t cause the kinds of huge fireballs seen at the derailment. But the Pipeline and Hazardous Materials Safety Administration (PHMSA) indicated in a statement that what Casselton and two other major, unexpected explosions had in common was crude oil from the Bakken, and that they would be testing for the possibility that North Dakota crude is simply more flammable. It is unclear as of yet whether this flammability is simply caused by the chemical makeup of Bakken crude, or whether the injection of hydraulic fracturing chemicals could contribute.
The potential difficulties in transporting more dangerous fuel was enough to cause shares of Whiting Petroleum Corp., Continental Resources Inc., and other Bakken drillers to drop significantly on Thursday.
Meanwhile, officials in nearby Minnesota braced for the likelihood that more oil shipments by rail would mean more spills and fires, a grim reality for a state with over 4,393 miles of freight rail lines.
Fires are not the only hazard of transporting fossil fuels by rail. Major spills are a danger even if the oil doesn’t burn. And a proposed rail line through Washington, D.C. would carry crude and other hazardous chemicals less than 50 feet from the homes of families, children, and seniors, and less than a mile from the Capitol building.
2013 was a bad year for fossil fuel disasters, and one of the worst was a train derailment in Lac-Mégantic, Quebec, where a train carrying Bakken crude derailed and exploded, killing at least 42 people and destroying the center of the town.
As production booms in the Bakken and other formations, fossil fuel transport by rail isn’t the only dangerous method. 2013 saw a significant number of pipeline disasters, including the largest onshore pipeline spill in U.S. history, when 20,600 barrels leaked from a North Dakota pipeline and went unreported for a week.