Texas tank fire may spur tougher safety regs on chemical and oil storage

The fuel terminal fire that shut down the nation’s largest shipping channel and spewed air pollutants into nearby neighborhoods may push the fight for tougher regulations for many proposed fuel and oil storage terminals along the U.S. Gulf Coast, officials said.

Smoke from the ITC fire surrounded local communities causing Shelter in Place orders and schools to be cancelled. Photo by Amy Additon.

A fire at Mitsui & Co.’s Intercontinental Terminals Co. (ITC) that started on March 17 and continued for three days has many state officials investigating reasons for the incident.

The fire engulfed 11 above ground storage tanks containing a variety of hydrocarbons, resulting in multiple orders for community members to Shelter in Place and cancelling schools.


Officials have begun investigating whether ITC met safety and environmental regulations.

Texas Attorney General Ken Paxton filed a lawsuit accusing ITC of violating clean-air laws.

“The state of Texas works hard to maintain good air quality and will hold ITC accountable for the damage it has done to our environment,” Attorney General Paxton said in a statement.

“ITC has a history of environmental violations, and this latest incident is especially disturbing and frightening. No company can be allowed to disrupt lives and put public health and safety at risk,” Paxton added.

The U.S. Chemical Safety Board (CSB) is also investigating the recent fire at the ITC site in Texas. CSB investigators have begun interviews and plan to be on site for several days to document the scene and collect evidence.

The U.S. Occupational Safety and Health Administration are investigating the disaster as well.
Harris County in Texas, the site of the ITC fire, said it will sue ITC for failing to prevent the chemical fire. The county is seeking a temporary injunction and restraining order against the company, alleging that it violated the Texas Clean Air Act and the Texas Solid Waste Disposal Act, among other rules.

The Harris County investigation is separate from a probe already started by the Harris County Fire Marshal’s office.

Increased scrutiny

Reviews of these investigations may result in proposals for increased environmental scrutiny for many future storage facilities that are planned to accommodate the growing U.S. oil production for exports.

Harris County plans to review the investigations and could propose amendments to state regulations, Harris County Judge Lina Hidalgo told Reuters.

ITC adheres to fire-prevention guidelines set by industry group the National Fire Prevention Association and the American Petroleum Institute.

However, critics say the NFPA guidelines set minimum standards and the use of advanced fire-protection systems could have more quickly extinguished the fire before it spread and released millions of tonnes of air pollutants.

Other disasters impact storage

Storage was also a key problem in the U.S. Gulf after the flooding caused by Hurricane Harvey in 2017. 

“Almost everywhere the problem is with storage. It is a less glamorous thing to consider, but it must be included in capex plans,” Ramanan Krishnamoorti, Chief Energy Officer at the University of Houston said. “The industry must consider how to look at multiple barriers of defense when investing high capex manufacturing dollars.”

Krishnamoorti said these barriers include using information technology, rethinking the supply chain, improving front and back end engineering and improving storage options.

Cost and impact

The closure of a major chunk of the Houston Ship Channel following the fuel terminal fire could cost the petroleum and petrochemical sectors an estimated $1 billion, including clean-up, repairs and lost economic opportunity, according to early estimates.

The Houston Ship Channel was closed for at least three days as emergency workers drained fuels that leaked from the fire.

Fuels spilled after a section of a containment barrier breached on March 22 at ITC. Before the wall was repaired the next day, the breach sent fuels, water and fire suppressant foam to a waterway that connects Houston to the Gulf of Mexico.

The Houston Shipping Channel began to reopen on March 25. More than 30 ships were stranded on the reopen morning on either side of the no-go zone, according to the U.S. Coast Guard.

The U.S. Gulf is the nucleus of the North American petrochemical industry, so outages in this region impact supply chains across the U.S.

The Gulf Coast produces chemicals used in everything from toys to automobiles including the packaging and boxes used to ship these products to other areas, and the fuel for the trucks and ships to deliver the products.

With more than $130 billion in shipments, Texas is the largest chemical producing state in the U.S. Industrial chemicals are by far the largest bulk commodity traversing the waterway, followed by petroleum coke and grain.

By Heather Doyle