Feds issue final rule allowing liquefied natural gas by rail

A photograph of tank cars in a rail yard. The tank cars are in lined up left and right.

The U.S. Department of Transportation (DOT) and the Pipeline and Hazardous Materials Safety Administration (PHMSA) are authorizing the bulk transportation of liquefied natural gas (LNG) by rail via a final rule that the agencies issued on Friday.

The rule, which was made in consultation with the Federal Railroad Administration (FRA), allows for the bulk transportation of LNG using DOT-113 tank cars with enhanced outer tank requirements and additional operational controls.

The issuance of the final rule comes as House Democrats on the U.S. House Committee on Transportation and Infrastructure seek to slow down President Donald Trump’s timeline for allowing LNG by rail because of safety concerns. The $500 billion infrastructure bill crafted by Democratic committee leaders included language that would charge FRA and PHMSA with conducting a risk study on transporting LNG by rail. 

Rep. Peter DeFazio, D-Oregon, who chairs the House committee, has also criticized PHMSA for quickly reviewing and approving a special permit that enables Energy Transport Solutions to transport LNG by rail. Energy Transport Solutions, a logistics subsidiary of New Fortress Energy, seeks to use specialized cryogenic railcars designed for supercooled liquids. The permit allows shipments between Wyalusing, Pennsylvania, and Gibbstown, New Jersey, and expires on Nov. 30, 2021.

According to PHMSA, this final rule incorporates newly designated additional safety requirements, such as an enhanced, thicker carbon steel outer tank, and it requires the remote monitoring of the pressure and location of LNG tank cars. The rule also requires a two-way end of train or distributed power system when a train is transporting 20 or more tank cars loaded with LNG in a continuous block, or 35 or more such tank cars of LNG anywhere in the train consist. And the rule requires railroads to conduct route risk assessments to evaluate safety and security.

PHMSA said the rule reflects “best practices and best-available technologies, sets increased regulatory certainty, and provides policies that promote America’s natural resources.”

“The Department’s new rule carefully lays out key operational safeguards to provide for the safe transportation of LNG by rail to more parts of the country where this energy source is needed,” said U.S. Transportation Secretary Elaine Chao.

The final rule will be published in the Federal Register, and an official version will appear in docket No. PHMSA-2018-0025 on the regulations.gov website.

(Click here for FreightWaves articles by Joanna Marsh)