Thursday, August 14, 2014

DOT rules on shipping crude by train could cause delays and higher costs

The U.S. Department of Transportation's new plans to bolster railcar safety could lead to a shortage of cars, leading to a delay in the transport of domestic oil, according to a report in the Wall Street Journal.

The proposed DOT rules calls for the current DOT-111 railcars, which have been involved in a number of recent crashes, to be phased out by 2018. Newer car models would require substantive retrofits that will total $1 billion, according to regulators' estimates.

Analysts told the paper that producers that currently make 35,000 new rail cars a year probably won't be able to match the demand for new cars.

The Railway Supply Institute, an industry trade organization, said the industry had more than 52,000 backlogged orders at the end of the second quarter of 2014.

For more of the Washington Times story: washingtontimes.com


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