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February 21, 2014

BNSF plans to upgrade tanker fleet after accidents

BILLINGS, Mont. — BNSF Railway Co. said Thursday it intends to buy a fleet of 5,000 strengthened tank cars to haul oil and ethanol in a move that would set a higher benchmark for safety within an industry that’s seen multiple major accidents.

The voluntary step by the Texas-based subsidiary of Warren Buffett’s Berkshire Hathaway, Inc. comes as railroads in the U.S. and Canada are under intense pressure to improve safety for hazardous materials shipments.

There’s been a string of recent train accidents involving oil and ethanol, punctuated by a crude shipment that derailed in Quebec last July and killed 47 people.

A boom in domestic oil drilling and rising ethanol production spurred a dramatic increase in shipments of the materials by rail. Much of it is being hauled by an old fleet of some 78,000 tank cars that are prone to split during accidents.

Thursday’s announcement marks a potential major step in addressing that problem. However, it would not mean those older cars would go away, and there’s already a two-year backlog on new tank car construction.

In announcing that it will ask manufacturers to submit bids for the new cars, BNSF indicated it was unwilling to wait for the U.S. Department of Transportation to finalize pending regulations on improved tank cars.

The company said it hoped to accelerate the transition to a new generation of safer tank cars and give manufacturers a head start in designing them as federal officials consider changes to the current standards.

Typically, railroads don’t own the tank cars they pull, making BNSF’s proposal somewhat unusual. But whether it will spur other shipping companies or railroads to follow suit was uncertain, said Tom Simpson, president of the Railway Supply Institute, a trade association representing tank car manufacturers and owners.

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