Railroads Agree to Slow Oil Trains in Populated Areas

Railroads agreed with U.S. regulators to slow trains hauling crude oil and install safety equipment in response to derailments including an accident and explosion in Canada that killed 47 people.

The Association of American Railroads, representing companies including Berkshire Hathaway Inc. (BRK/A)’s BNSF Railway Co., said its members will reduce speeds of certain trains carrying crude. Trains with at least 20 cars, including a model linked to the accidents, will slow to 40 miles (64 kilometers) per hour or less near 46 urban centers areas deemed as high risk.

“The rapid increase in the production and transportation of crude oil requires additional vigilance for the continued safe movement of this commodity,” Transportation Secretary Anthony Foxx wrote in a letter released today to Edward Hamberger, president of the Washington-based railroad association.

Holly Arthur, a spokeswoman for the group, said the new speed is 10 mph slower than trains now travel in the areas. She said the impact on railroad operations would be minimal and companies will monitor the effect of the lower speed limit.

The companies reached agreement with the Transportation Department after weeks of talks spurred by the derailments. In addition to the July disaster in Lac-Megantic, Quebec, residents of a North Dakota town were evacuated after an oil train car derailed and exploded. No one was injured in the accident.

Detectors Installed

Railroads also agreed to install new sensors about every 40 miles along routes used by trains carrying crude.

The companies said they would use a new rail management tool to determine the safest and most secure routes for trains with 20 or more cars. The evaluation will cover population density, local emergency-response capability and track quality, according to the railroad association.

Federal regulators are separately considering requiring upgrades to the DOT-111 tank car, which the U.S. National Transportation Safety Board has said must be strengthened to reduce spill risks.

BNSF said in a statement that it “strongly supported” the new agreement.

The company is seeking bids to buy 5,000 oil tank cars with improved safety standards. The request for bids will be made to numerous car makers, said Roxanne Butler, a spokeswoman for BNSF.

To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net

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