Category: Class 1 Railroads

Three years after opening it’s second locomotive production facility and despite slowdowns in the railroad industry, GE rolled out its 1,000th locomotive built in Fort Worth. GE Manufacturing Solutions, a wholly-owned entity of GE, marked a milestone on Thursday by celebrating the milestone locomotive built at the Fort Worth site. More than 700 employees attended a ceremony commemorating the achievement.

“This milestone is a testament to the hard work and dedication of the team here in Fort Worth,” said Richard Simpson, vice president and global supply chain leader, GE Transportation. “In less than four years, this team helped start up the GE Manufacturing Solutions facility and built 1,000 high-quality, competitive locomotives for our customers. ”

The 1,000th locomotive is a GE Transportation Evolution Series Tier 4 model for Canadian National Railway. Part of the ecomagination-certified Evolution Series, GE’s new Tier 4 locomotive decreases emissions by more than 70 percent from Tier 3 technology to meet the U.S. Environmental Protection Agency’s Tier 4 standards. GE Manufacturing Solutions completed assembly of its first locomotive, a Tier 3 Evolution Series model for Fort Worth-based BNSF Railway, in early 2013. GE has built a few hundred locomotives for BNSF at the Fort Worth plant.

“Our team has accomplished a lot since delivering the first locomotive,” said Walter Amaya, locomotive plant manager for GE Manufacturing Solutions. “Thanks to the support from the community, suppliers, and other GE sites, our team has continuously improved the site’s productivity and increased the production rate to 10 locomotives a week. Those efforts positioned the site for success in today’s challenging market and a bright future for years to come.”

GE Manufacturing Solutions’ locomotive plant began operations in 2013. The one million square-foot facility is now GE Transportation’s primary manufacturing site for Evolution Series locomotives.

No. 3087, painted in red and black, is one of 50 ordered by CN and most likely will be shipped to Chicago for service. GE has invested $600 million over the last decade in the development of the Evolution Series Tier 4 locomotive. The locomotive is powered by GE’s 12-cylinder EVO engine and requires no after-treatment system.

Production at the plant began in 2015 shortly after GE received 1,355 Evolution Series Tier 4 locomotive orders to be fulfilled over the next three years.

The Fort Worth plant, on a site adjacent to the Texas Motor Speedway, complements GE’s operations at its older transportation facility in Erie, PA.

 

 

Railroads will get three more years to implement positive train control (PTC) following the passage of a transportation bill in the House and Senate this week.

On Tuesday the House passed short-term legislation for a transportation measure that includes extending the deadline for PTC, a safety requirement designed to prevent train collisions, to Dec. 31, 2018. A day later, the Senate approved the measure, HR 3819, which now goes to the White House for sign-off.

The extra time comes through a measure that extends for three weeks the operation of public transit and highway programs while Congress continues work on a long-term authorization bill.

Transportation leaders lobbied for an extension of this year’s Dec. 31 PTC deadline that requires railroads to install the safety system across portions of freight and passenger systems. In August the Federal Railroad Administration reported that most railroads would not be compliant by the deadline. Railroads, which could face civil and criminal penalties by continuing to operate if not PTC compliant, said they would suspend service if the deadline was not extended.

The Association of American Railroads (AAR) said the industry has made “substantial” progress in implementing PTC but holding the 2015 deadline would be “devastating” and lead to halting freight rail transportation and significant economic pain. AAR said halting rail service could cost the U.S. economy $30 billion and force 700,000 out of work.

PTC is required to be implemented on Class I railroad main lines over which any poisonous- or toxic-by-inhalation hazardous materials are transported, and on any railroad’s main lines over which regularly scheduled passenger intercity or commuter operations are conducted.

Railroads have invested significantly to comply with what has been an evolving safety measure. The Rail Safety Improvement Act of 2008 mandated that PTC be implemented across a significant portion of the rail industry, but the final rule addressing requirement wasn’t approved until two years later.

Freight railroads have spent close to $6 billion on PTC development, testing and installation, the AAR says. An estimated $4 billion more will need to be spent before the technology is fully operational across the United States.

AAR President and CEO Edward R. Hamberger lauded the bipartisan votes by lawmakers in the House and Senate to pass HR 3819 and extend the deadline.

“This provides the certainty American industries and businesses need to serve the millions of Americans who rely on rail every day,” he said. “The extension means freight and passenger railroads can continue moving forward with the ongoing development, installation, real-world testing and validation of this complex technology.”

Michael Melaniphy, president and CEO of the American Public Transportation Association, said the extension avoids a situation that could have put more cars on the road if passenger rail systems were shut down.

“By implementing a realistic timeline for PTC, the disruption of Americans who take nearly 2 million daily trips on commuter rail systems every weekday was avoided,” he said in a statement. “This extension prevents the shifting of these daily commuter rail trips onto overburdened roads, which could have contributed to an unsafe commuting environment.”

An anticipated record grain harvest is gaining traction among North American farmers but not so much on the rails. As wheat and soybean production surges, shipments on U.S. railroads have been delayed because of backlogs attributed to increased demand for rail cars that some say points to the oilfield.

BNSF Railway and Canadian Pacific have reported backlogs of almost 2,400 cars between them, according to published reports. Both railroads maintain that oil shipments have not replaced crop shipments but farmers and shippers are applying pressure in an attempt to get product to market.

On Thursday, the U.S. Surface Transportation Board will hold a public hearing in Fargo, ND, where farmers and shippers can voice concern. CP and BNSF representatives are expected to attend.

While oil production from the Bakken Shale in North Dakota and other U.S. North American oil plays have commanded significant track time, America’s grain belt has been churning at a record pace. The U.S. Dept. of Agriculture said that total inspections of grain (corn, wheat, and soybeans) from all major export regions reached for the week ending Aug. 21 were up 51 percent from last year and 22 percent above the three-year average. Total inspections were 1.81 million metric tons, an 11 percent increase from the previous week.

This year’s U.S. wheat harvest is expected to be a record 273 million bushels, up from 235 bushels in 2013. Record amounts of soybeans are expected, as well as a significant increase in corn production.

However, opportunities are being lost because product can’t get to market fast enough.

In May, a North Dakota State University study concluded that North Dakota farmers have lost nearly $67 million this year because of rail shipment delays, and could lose an additional $95 million if the delays persist.

North Dakota farmers rely on rail transportation to move its top major crops of wheat, corn, and soybeans.

The study reported that increased oil transportation contributed to delayed grain deliveries and increased costs in transportation. An extremely cold winter and high demand for grain shipments also contributed.

Petroleum and petroleum-related shipments have been on the rise, but so have other commodities.

The Association of American Railroads (AAR) reported last week that total combined U.S. traffic for the first 34 weeks of 2014 was 18,557,471 carloads and intermodal units, up 4.6 percent from last year. For the week ending Aug. 23, carloads were up 3 percent compared to the same time last year.

Eight of 10 of the carload commodity groups posted increases compared with the same week in 2013, including petroleum and petroleum products with 16,396 carloads (up 28.4 percent) and grain with 18,721 carloads (up 17.6 percent). Nonmetallic minerals were up 10.5 percent.

Canadian railroads have posted similar increases in rail traffic.

Average terminal dwell time per hour per car, however, is on the rise, indicating that car movement across U.S. and Canadian rail systems is slower. Of six Class Is voluntarily reporting dwell time to the AAR, all posted higher times in July 2014 compared to the second quarter of 2013. BNSF and CSX topped the charts, each averaging five additional hours.

But railroads are making an effort to meet demand by the farm, even if it means stepping back from the oil patch.

In August, OmniTRAX Canada announced it would suspend plans to ship crude oil for the foreseeable future to accommodate large grain contracts.

President Merv Tweed said that consultations with First Nations, Metis and the provincial government were important factors in the company’s decision to suspend shipping crude by rail.

“Our decision to suspend crude by rail was based in part that grain shippers were willing to commit long-term orders in contracts of over 700,000 metric tons due to the market’s overall growth,” Tweed said in a news release. “Following last year’s record crop, we’re preparing for another strong shipping season.”

The railroad group also said it would continue to diversify its product mix through the Port of Churchill to include potash, feed and wood pellets.

“After reviewing our current business operations, we are also developing a long-term sustainability strategy that will make policy recommendations to the Provincial and Federal Governments, as well as identifying critical infrastructure investments required to continue the development of the Northern Gateway trade corridor,” said Tweed.

The Port of Churchill handled over 600,000 metric tons of grain in 2013; almost 10 million liters of petroleum products; building and construction materials as well as dry goods, vehicles and equipment and a variety of products for mining companies, communities and individuals.

BNSF Railway announced in February it is soliciting bids for the construction of 5,000 strengthened “Next Generation” tank cars to haul oil and ethanol.

Cars to be built are to exceed the stronger new standards the industry voluntarily adopted in October 2011 for the CPC-1232 jacketed tank car and will add new safety requirements. The tank car body shell and head ends will be built of thicker steel and, will have half-inch thick steel shields on either end to help prevent cracking during an accident. Cars also will have pressure-relief valves that could withstand an ethanol-based fire.

BNSF’s plans are a little unusual, because railroads don’t typically own tank cars.

“This BNSF tank car RFP represents a significant voluntary commitment that may help accelerate the transition to the Next Generation Tank Car and provide tank car builders a head start on tank car design and production, even as the Department of Transportation, railroads and shippers continue to engage in the formal rulemaking process,” the company said in a statement recently. “BNSF believes that the RFP process will provide market participants more certainty, sooner.”

The safety of rail transport of crude and natural gas has come under the microscope since last July. A Montreal, Maine & Atlantic train carrying crude oil from North Dakota’s Bakken Shale derailed and exploded in Lac-Mégantic, Quebec, killing 47 people. Lawsuits have been filed against the Canadian government as well as the railroad, the company’s president, train operator and others. The MM&A filed for bankruptcy.

Policymakers and railroad officials have huddled since the first of the year to address growing concern over how to safely move crude oil by rail.

In February, the U.S. Department of Transportation (DOT) and the Association of the American Railroads (AAR) agreed to institute  new voluntary operating practices for trains with 20 or more cars of crude oil.

Among the initiatives are increased track inspections, equipping trains with distributed power or two-way telemetry end-of-train devices, use of rail traffic routing technology and lower speeds.

By no later than July 1, railroads will operate trains that include at least one older DOT-111 car no faster than 40 miles per hour in the 46 federally designated high-threat urban areas. Until then, railroads will operate trains with 20 or more carloads of hazardous materials, including crude oil, at the industry self-imposed speed limit of 50 miles per hour.

Also, effective March 25, at least one additional internal-rail inspection will be performed each year above those required by new FRA regulations on main line routes over which trains moving crude oil travel. Railroads will conduct at least two high-tech track geometry inspections each year.

Railroads will also begin using the Rail Corridor Risk Management System (RCRMS) to aid in determining the safest and most secure rail routes.

In January, following derailments in North Dakota and Canada, Transportation Secretary Anthony Foxx challenged leaders from top rail industry organizations and CEOs of the nation’s largest railroads to analyze the routings of trains carrying crude oil to determine and then reduce any risks.

The meeting, which was also attended by representatives of the nation’s leading oil and natural gas producers, was sandwiched between two of the most recent derailments. About a week before, a Canadian National train hauling oil and natural gas derailed near a northwestern New Brunswick village. In mid-February, 21 cars of a 120-car Norfolk Southern train carrying heavy Canadian crude derailed and spilled 3,000-4,000 gallons in western Pennsylvania.

“The (rail) industry … can undertake preventative steps that will enhance the safety of these materials across the country,” Foxx said.

According to the Energy Information Administration, U.S. crude oil production will reach 8.5 million barrels per day by the end of 2014 – up from just five million barrels per day in 2008.

U.S. freight railroads transported nearly 234,000 carloads of crude in 2012, up from 9,500 carloads in 2008. Early data suggest that rail carloads of crude surpassed 400,000 in 2013.

More on this story in the March/April issue of Cowcatcher Magazine.