Before anyone gets out of hand heres the facts. According to a article posted on Reuters this morning BNSF has sent a procurrment order aka a bid procees out for these new tank cars to replace the older ones now in use and outdated by DOT standards. BNSF will own/lease these tank cars to the customers who need them. These will be the double hulled, pressure release valve type the DOT has been calling far to prevent the type of spills in the derailments with the catastophic fires. That is all
That is good news.
C&NW, CA&E, MILW, CGW and IC fan
Somebody appears to have gotten their facts wrong unless BNSF is setting a precedent by going into the car-leasing business. Tank cars other than company service cars were never railroad-owned.
Apparently, BNSF wants to change that. Pulling up the BNSF website may or may not confirm that report.
Are we not on the verge of having the government announce new tank car standards in response to these latest high profile oil train wrecks? That is my understanding. If that is true, won’t those new, impending standards be more stringent than the current standards that improve the safety of the older DOT-111 tank cars?
If this is all correct, why would anybody buy new tank cars right now when they might not meet new standards that are right around the corner?
I guess the basic explanation is that there is the assumption that any new standards will not ban pre-existing tank cars before their life cycle is used up.
Euclid Are we not on the verge of having the government announce new tank car standards in response to these latest high profile oil train wrecks? That is my understanding. If that is true, won’t those new, impending standards be more stringent than the current standards that improve the safety of the older DOT-111 tank cars?
Short answer, no, they will probably be very similar standards.
Because the "new" standards will most likely be the same as the current AAR standards.
Correct which is why the older DOT111 cars are still in service.
Supprised you are asking these questions since we've covered these points several times before in previous threads.
Dave H. Painted side goes up. My website : wnbranch.com
I have emailed a request for clarification from BNSF. Their current "Latest News" on their website does not mentnion this.
The new 'tough' standards were originally proposed by the AAR almost 3 years ago - The car owners did not like the idea, and the AAR really could not force the issue. Now the Fed's are involved, and it appears that what the AAR proposed will be the new DOT standard(with a few government 'tweaks').
BTW, BNSF owns quite a few large tank cars that are in general service(Black with a BNSF 'Swoosh' logo). If BNSF has the capital resources to make a large purchase like this, it will pay for itself in lease cost rather quickly. Of course, it is always nice to have the 'long pockets' of Berkshire Hathaway(Warren Buffett) behind you!
Jim
Modeling BNSF and Milwaukee Road in SW Wisconsin
There is the possibility of this restricting the utility of the tank car fleet. With the current private car fleet, any tank car can operate on any route. So a train might operate over the CP today, the CN next week and the BNSF the week after that. It is possible that the BNSF might restrict the use of the tank cars they provide to routes that operate over them (why would they pay the money to put the newer cars on another road and run the older cars on themselves). Should be interesting to see what they do with the cars next year.
dehusman Euclid Are we not on the verge of having the government announce new tank car standards in response to these latest high profile oil train wrecks? That is my understanding. If that is true, won’t those new, impending standards be more stringent than the current standards that improve the safety of the older DOT-111 tank cars? Short answer, no, they will probably be very similar standards. If this is all correct, why would anybody buy new tank cars right now when they might not meet new standards that are right around the corner? Because the "new" standards will most likely be the same as the current AAR standards. I guess the basic explanation is that there is the assumption that any new standards will not ban pre-existing tank cars before their life cycle is used up. Correct which is why the older DOT111 cars are still in service. Supprised you are asking these questions since we've covered these points several times before in previous threads.
I realize that I have asked the question before, and that you have answered it. But I am looking for more than just your opinion that the impending new standards will be the same as the existing best standards. By all logic, “new standards” are different from existing standards. If new standards were the same as the existing standards, what would be the point of new standards?
Furthermore, their seems to be a sense of urgency in releasing these new standards as if they are needed to address something that is not being addressed by the existing standards.
Dave,
Tank cars like this are usually in 'assigned' service like unit crude oil trains. BNSF delivers the entire train to NS or CSX for forwarding to the East Coast, and the empty train is moved back as a complete set. I am sure they are not considered 'free' runners in the normal interchange rules. Of course they could always give them some kind of 'private' reporting marks to insure that!
BNSF's 10-11 trains and CP's 2 trains/day that run out of North Dakota operate as unit trains, and I suspect that the revenue 'deal' with NS or CSX require them to be returned as a set(unless there is a maintenance issue). The 'buffer' cars and engines many times run through as well. I remember a few years ago that DM&E was removing their buffer cars when delivering the ethanol trains in Chicago because their buffer cars were being used and not returned. DM&E/IC&E crews would go to pick up an empty train and the buffer cars had been removed. They had to return back home to pick up and empty car as they were required even for empty trains. BNSF has dedicated buffer cars - usually older 100 ton capacity covered hoppers weighted with sand or gravel so they will track on the head end of a unit oil train. I read somewhere that BNSF weights them to about 45 tons.
CSSHEGEWISCH Somebody appears to have gotten their facts wrong unless BNSF is setting a precedent by going into the car-leasing business. Tank cars other than company service cars were never railroad-owned.
The daily AAR Smart Brief e-mail newsletter that I get has the Reuters story, too. If it's bogus, they fooled the AAR also.
Jeff
jrbernier Tank cars like this are usually in 'assigned' service like unit crude oil trains. BNSF delivers the entire train to NS or CSX for forwarding to the East Coast, and the empty train is moved back as a complete set. I am sure they are not considered 'free' runners in the normal interchange rules. Of course they could always give them some kind of 'private' reporting marks to insure that!
Exactly. But that doesn't mean the same set of cars always goes between the same OD pairs. If the crude is shipped to 3 different refineries, one on the east coast, one in Louisiana and one in Texas, they would travel on different routes on different roads.
If BNSF leases the cars to the Big Drill Co. and they originate shipments that travel on both the CP and BNSF, will the BNSF cars be restricted to only BNSF routes?
If the BNSF leases the cars to Acme Refining and they source oil from a well head on the BNSF and a well head on the CN, will the BNSF cars be restricted to serving only the BNSF wellhead.
Some CBR does travel in less than unit train shipments (the recent derailment in PA inolved a less than unit shipment), will the BNSF cars be excluded from less than unit service? The cars are all in "assigned" service and none of them are free runners, but they do move outside of unit train service.
A similar thing occurs with unit coal trains, a set owned/leased by a utility may operate over one railrod for one loading and over another railroad for the next loading.
It will be interesting to see how these are deployed and how long the BNSF keeps them.
THE REPORT IS CONFIRMED BY A BNSF SPOKESMAN:
Forsberg, Steven E
Hmm...vertical integration at play here.
Berkshire Hathaway owns: BNSF, General Re and a host of other insurance companies, Union Tank Car, and some Exxon Mobil shares.
My guess is that UTC will build the cars, and Berkshire Hathaway will set up a leasing company within BNSF to protect other assets.
Further, this is a strong indication to me that BH believes the Keystone XL pipeline will NOT be approved by Mr. Kerry at the State Department.
Follow the $$$/
Ed
Here is the report from Reuters:
http://www.reuters.com/article/2014/02/20/us-bnsf-crude-rail-idUSBREA1J1BE20140220
This one's a game changer.
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