The Chemical World This Week
FEA MOVING QUICKLY ON OIL STORAGE PROGRAM One of the key projects in U.S. energy strategy has been kicked off and may be pushed ahead of the original schedule. The Federal Energy Administration has picked a construction manager for the early stages of the multibillion-dollar strategic petroleum reserve (SPR) program. FEA's $10 million initial contract has gone to Parsons-Gilbane, a joint venture of Ralph M. Parsons Co., Pasadena, Calif., and Gilbane Building Co., Providence, R.I. Plans call for 150 million bbl of crude oil to be in storage by the end of 1978. This is called the early storage reserve (ESR). Some crude oil may be injected into caverns washed out of salt domes along the Gulf Coast by this July. Earlier, FEA had contracted with Gulf Interstate Engineering as architect-engineer for the program. Now, the Carter Administration has decided to accelerate the SPR program as proposed by the Ford Administration with a target date for 500 million bbl of crude oil in SPR by the end of 1980 instead of 1982, according to Thomas E: Noel, an FEA assistant administrator handling the program. Last week FEA also disclosed the selection of three sites, all salt domes, in which caverns will be made to store the crude oil as part of ESR. These domes are located near Angleton, Tex., Hackberry, La., and in Iberville Parish, Louisiana. Other sites being considered include two limestone mines in Kentucky and Ohio and three mined salt chambers in Louisiana and Texas. Parsons-Gilbane also will be responsible for supervising construction of pipelines, docks, and other facilities involved in transferring the crude oil to and from storage. Practically all of the oil will be imported, Noel says. It will be of types that might be cut off by an embargo. He estimates that 65% will fall in a general category known as South Arabian light, which has a mid-range gravity of 32° to 36° API, and 1.0 to 1.9% sulfur content. The remainder would be various other kinds of crude oils with sulfur contents less than 1%. The reason for selecting these crudes is to minimize changes needed in refineries to process crude oil, says 6
C&EN April 11, 1977
Oil storage sites are close to coast / .;
TEXAS • Baton Roug< Plaauemine*
Hackberry
Angleton « Freeport j
Gulf of Mexico
Noel. The average properties of the crudes to be stored will differ from the typical pattern of U.S. refinery runs, now a combination of many different domestic and foreign crudes. However, the stored crudes combined with available domestic and nonembargo crudes would allow average refinery runs to continue with minimal changes in product mix and operations. Total cost of a 500 million bbl SPR will run $7.5 billion to $8 billion, according to FEA. About 90% of the cost will go for purchasing and transport-
ing the crude oil. For fiscal 1978, $3.18 billion has been budgeted by all of the facilities for the program and to buy crude oil for the early storage phase of the program now under way. Noel admits that there's some concern over advancing the completion date. However, he says, the possibly higher costs of building facilities more rapidly than originally planned would be offset by lower costs of the crude oil. On balance, Noel says, FEA estimates that the total program might cost slightly less if completed by the end of 1980. G
Study suggests changes in product liability A government interagency task force I recommends modifications to the tort study, billed as the "most compre- system as the most appropriate rehensive analysis of the product lia- sponse. The report disagrees with a bility issue ever undertaken," has number of recommendations that been released by the Department of have been made by industry. Among subjects considered are: Commerce. The task force was created in • A statute of limitations. ManuMarch 1976 after businessmen car- facturers want a limit placed on the ried warnings to the White House duration for which they can be held about the economic impact of sky- liable. But, the study says, making rocketing insurance premiums. radical changes could raise ConstiManufacturers and insurers want a tutional problems as well as bar lemajor overhaul of the "tort system," gitimate claims before the injury ocwhich provides for product liability curs or before the user buys the litigation. product. Instead, it gives a qualified The 1500-page report, prepared for recommendation to a "useful life" the task force by Research Group defense under which the maker could Inc., Charlottesville, Va., does not incur no liability after the product's propose a major overhaul. Instead it I useful life had expired.
• A misuse defense. Manufacturers say that under strict liability principles, they are held liable even if products are misused. The study endorses a comparative fault system in product cases and permits manufacturers to shift some liability in workplace injury cases. • A state-of-the-art defense. This idea for manufacturers would bar recovery of damages when a product conformed to industry practice at the time of manufacture. As a short-term solution, the study recommends "adoption of joint underwriting associations with federal reinsurance and 'captive' insurance companies," according to Neill Hollenshead, vice president of Research Group. Captive insurance companies are organized by a manufacturer or group of manufacturers to insure risks of their companies. Such combined ventures have been proposed for chemical companies. D
Nuclear industry may lose liability limit The problem-plagued nuclear power industry received what may be another major setback late last month. It came as a federal district court decision declaring the Price-Anderson Act, which set up a federally administered liability insurance program for nuclear facilities, unconstitutional. The act, according to judge James B. McMillian of the District Court for Western North Carolina, violates the equal protection and due process provisions of the Fifth Amendment by setting a maximum liability ceiling for a single nuclear accident of $560 million. The suit was brought against Duke Power Co. and the Nuclear Regulatory Commission by a group of citizens living near Duke Power's Catawba nuclear station and the site of its proposed McGuire nuclear station, now under construction, both near Charlotte, N.C. In finding for these people, judge McMillian stated that the act violates the Constitution "because it allows the destruction of the property or the lives of those affected by nuclear catastrophe without reasonable certainty that the victims will be justly compensated." The act also encourages irresponsibility in matters of safety and environmental protection by setting an unrealistically low ceiling on the accountability of developers, the opinion states. The decision will almost certainly be appealed, either to the circuit court of appeals in Washington, D.C., or directly to the Supreme Court. The Price-Anderson Act, adopted
and refinery workers exposed to PCB mixtures for five or six years. Human ingestion of extremely high levels of the substances, about 35 mg per day, can result in acnelike skin eruptions, darkening of skin and nails, excessive discharge from the eyes, and swelling of the eyelids. PCB's have been of concern since the early 1970's when they were found to persist and accumulate in the environment. Legal limits for PCB's were first formally established by FDA in 1973. Since that time most of the major uses of PCB's, such as in carbonless copy paper, fire-resistant hydraulic fluids, plasticizers, and paints, have been phased out. The remaining major use of PCB in elecNuclear power plant construction may betrical equipment will be phased out threatened by crucial court decision by July 1977, and Monsanto, the only U.S. producer of PCB's, plans to in 1957 and renewed in 1975, requires withdraw completely from the market nuclear power companies to make later this year. payments into a federally held inUnder FDA's proposal, the legal surance fund that would be used to limit or tolerance level for PCB's pay damages in the event of a nuclear would be lowered from 2.5 ppm to 1.5 accident. Many, including judge ppm in the fat of milk and dairy McMillian, consider the act to be products; from 5 ppm to 3 ppm in the crucial to nuclear development by fat of poultry; from 0.5 ppm to 0.3 private industry. "Without the ppm in eggs; and from 5 ppm to 2 Price-Anderson Act, regardless of the ppm in fish and shellfish. desires of the nuclear power industry, FDA explains that it is not propower companies probably would not posing a ban on the products because be able to obtain the necessary fi- the Delaney clause, which prohibits nancing, supplies, and architectural the addition to food of any substance skills to build nuclear power plants that causes cancer in man or test anand to maintain them once con- imals, does not apply to substances struction was complete," he says in such as PCB's, which are not intenhis opinion. tionally added to food, but enter food Segments of the nuclear industry, because of their presence in the enat least in their public statements, do vironment. Interested persons have not see the act as essential to contin- until June 1 to comment on the proued nuclear power development. "We posed tolerance levels. D see no nationwide shutdown of nuclear facilities (because of the court decision), and we do not plan to change our schedule on our existing NAS forum urges use of construction sites," says Carl Horn coal despite problems Jr., chief executive officer of Duke Power Co. If the decision is upheld by "Uncertainty" was the message at the the Supreme Court, which Horn says kickoff session of last week's National he thinks is unlikely, other forms of Academy of Sciences forum on coal— insurance coverage could be devel- uncertainty and a warning. oped, he says. D The warning was a matter of simple arithmetic. Without a rapid increase in the use of coal, the U.S. will be facing a disastrous energy shortage. FDA proposes lower Dr. Arthur M. Bueche, vice president PCB levels in foods of R&D for General Electric, estimated the shortfall to be about 26 The Food & Drug Administration is quads (quadrillion Btu) by the year taking steps to reduce the amount of 2000, even making very optimistic polychlorinated biphenyls (PCB's) assumptions about rates of growth allowed in certain food, including and conservation measures (see page milk, poultry, and fish. 5). By contrast, the 1973 oil embargo According to the agency, recent cost the U.S. about 1 quad. Without studies indicate that PCB's fed in coal, "I am not ruling out the very real high doses to test animals cause liver possibility of social upheaval and tumors. The substances also have revolution," Bueche says. been associated with increased skin Fortunately, however, the U.S. and pancreatic cancers among R&D does have coal, some 10 to 30 quinApril 11, 1977 C&EN
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