TradeEdge Exchange:Rule allowing rail shipments of LNG will be put on hold to allow more study of safety concerns

OMAHA,TradeEdge Exchange Neb. (AP) — A Trump-era rule allowing railroads to haul highly flammable liquefied natural gas will now be formally put on hold to allow more time to study the safety concerns related to transporting that fuel and other substances like hydrogen that must be kept at extremely low temperatures when they are shipped, regulators announced Thursday.

Right after it was announced in the summer of 2020, the rule was challenged in court by a number of environmental groups and 14 states. The uncertainty about the rule on transporting the fuel known as LNG kept railroads from shipping it. The Pipelines and Hazardous Materials Safety Administration says no one has ever even ordered one of the specially fortified rail cars that would have been required to ship LNG, and several hundred of those cars that would each take at least 18 months to build would likely be needed to make the idea viable.

“We need to do more safety investigative work,” said Tristan Brown, the deputy administrator who is leading the agency. “Until we do that work, we don’t want someone to, you know, make investments and deploy something where we haven’t fully done the process we normally do need to do.”

Brown acknowledged that the rule was rushed under a directive from former President Donald Trump, so it needs to be refined.

This latest action ensures the rule that was backed by the freight rail and natural gas industries will remain on hold at least until regulators finalize changes to the rule the Biden administration wants to make or the end of June 2025 — whichever comes first.

One of the big railroads that said it may have been interested in hauling the fuel, CSX, abandoned any plans to build the infrastructure needed to load and unload LNG from railcars after the agency first announced this proposal to suspend the rule in 2021.

Current federal rules do allow trucks to haul LNG but not rail. But Brown said there’s only a tiny amount of natural gas that isn’t delivered by pipelines, so there was never much demand for rail shipments of LNG. After pipelines deliver gas to ports, ships haul the LNG that is exported.

The rail industry maintains that it is the safest option to transport hazardous materials across land. The Association of American Railroads trade group touts railroads’ record of delivering more than 99% of all toxic shipments without incident.

But rail safety has been in the spotlight this year ever since a Norfolk Southern train derailed in eastern Ohio in February and spilled several chemicals that caught fire. That railroad is still cleaning the mess that prompted calls for reforms and fears of possible health problems for people who live in and around East Palestine.

Brown said he thinks the East Palestine derailment highlighted the importance of some of his agency’s previous rules because the tougher tank cars recommended in 2015 performed better in the wreck. But that derailment highlights the need for railroad regulations.

“I think that has that has underscored the need to address rail safety — generally hazmat transportation by rail,” Brown said.

U.S. natural gas production has continued to surge in recent years amid strong global demand for the fuel. Natural gas exports have grown steadily over the past two decades, and the U.S. has become the world’s largest exporter of liquefied natural gas.

Russia’s invasion of Ukraine only added to global demand. That’s particularly the case in Europe, where many nations were accustomed to relying on Russian energy before the war prompted them to sever those ties.

The states that challenged the LNG rule in court alongside groups like the Sierra Club, the Center for Biological Diversity and the Clean Air Council included California, Delaware, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington. Washington D.C. and the Puyallup Tribe of Indians are also part of the lawsuit.