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U.S. modifies testing order on Bakken oil rail shipments

The U.S. Department of Transportation on Thursday modified rules governing the testing of crude transported by rail from North Dakota.

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The agency said that tests, required to enforce safety standards, must be conducted to determine the flash point and boiling point of crude oil cargoes shipped from the Bakken shale, clarifying the specific testing requirements laid out in an emergency order on Feb. 25.

The new shipping guidelines follow a series of fiery accidents involving crude oil being moved by rail in the United States and Canada over the past year, many of which have involved Bakken crude that regulators say may be more flammable than other grades of oil.

Shippers of Bakken crude had expressed concern that the increased testing laid out in last week's emergency order would slow shipments of crude oil from North Dakota, which relies on rail for transport.

Data from intelligence provider Genscape showed that oil shipments from 12 Bakken loading terminals fell to unusually low levels in the days following the Feb. 25 order, but have since rebounded.

The DOT, through the Pipeline and Hazardous Materials Safety Administration, last year began an operation it dubbed "Bakken Blitz," which includes spot inspection of oil shipments aboard trains in North Dakota to make sure the crude was labeled properly and being shipped in the right tank cars.

Last month, the DOT said it fined three oil companies for wrongly classifying crude shipments from the Bakken.