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Vol. 18, No. 49 Week of December 08, 2013
Providing coverage of Bakken oil and gas

Scrutinizing crude

Canada and US collaborate to ensure crude oils are safe to transport

Gary Park

For Petroleum News Bakken

United States and Canadian regulators are collaborating in more rigorous scrutiny of crude oil being moved by rail as speculation persists that the Bakken crude involved in the explosions and fire in Quebec five months ago contained an explosive mix of chemicals.

Transport Canada inspectors are tightening their inspections of crude moving from the U.S. into Canada as they engage in a joint effort with their U.S. counterparts to ensure shippers check to see whether their crude volumes are too dangerous to ship.

Marie-France Dagenais, director general of the Transport Canada’s Dangerous Goods Directorate, told a committee of Canada’s House of Commons her government is committed to zeroing in on crude oil shippers, amid allegations they are ignoring Canadian safety regulations.

She said the increased policing follows the release this fall of new rules requiring shippers to test their crude oil content.

“We are actually refocusing some of our inspections,” she said. “We’re going to do it collaboratively (with the U.S.) to ensure that proper testing is done.”

Series of derailments

The concerns culminated July 6 when a train hauling 72 tank cars of crude from North Dakota’s Bakken region to the 300,000 barrels per day Irving Oil refinery in Saint John, New Brunswick, left the tracks in the town of Lac-Megantic destroying scores of buildings and killing 47 people.

Since then there has been a series of derailments, often involving hazardous materials, across North America.

Despite claims by companies such as pipeline operator Enbridge that Bakken crude contains a volatile mix of chemicals, investigators have yet to report what they have discovered about the crude content of the Lac-Megantic shipment, including suspicions by Canada’s Transportation Safety Board that the 50,000 barrels may have included undisclosed chemicals.

But Canada’s Auditor-General Michael Ferguson reported in late November that only days before Lac-Megantic a safety audit found “significant weaknesses” in Transport Canada’s oversight of railways and concluded that railway oversight was lacking “in all aspects.”

He reported that only 14 audits of 31 federally regulated railways operating in Canada had been completed in three years, or one-quarter of the total Transport Canada had been expected to conduct.

Eight of the audits focused on the two largest operators, Canadian National and Canadian Pacific, leaving smaller operators unchecked, including Montreal, Maine & Atlantic, whose train derailed at Lac-Megantic.

“The findings indicate that Transport Canada does not have the assurance it needs that federal railways have implemented adequate and effective safety management systems,” Ferguson’s report said.

His department said: Transport Canada lacks information on which routes are used to transport dangerous goods; is not collecting the internal risk assessments conducted by railways; and has failed to develop regulations to cover an operating certificate.

Transport Minister Lisa Raitt said it is “completely unacceptable” if oil shippers, including refineries, send crude without first testing it for safety.

She said in a statement that if a shipment originates in the U.S., the importer is responsible for classification testing and failure to comply will force the government to “take whatever course of action if available to us.”

Rex Beatty, president of the Teamsters Canada Rail Conference, representing more than 10,000 rail-operating employees, said in a statement that too much blame is being spread around at a time when productivity gains for CN and Canadian Pacific “have jumped well ahead of public safety” on the priority list, while a “cost-cutting culture” has been adopted by smaller railways.

He urged the Canadian government to rectify a policy that allows railways in Canada to develop their own safety management systems without making that information public.

Meanwhile, CN, which has figured prominently in the spate of recent train accidents, has announced it is buying additional monitoring equipment to improve its ability to pinpoint equipment defects.

Jim Vena, CN’s chief operating officer, said the C$10 million program will step up the railroad’s inspection and detection capabilities, including the quality of tracks, wheels and bearings.

CN said it has more wayside detection technology than any other rail company in North America and has increased that capability by 30 percent and increased the frequency of its ultrasonic rail flaw inspection by 70 percent over the past five years.

Vena said the new technology will improve the coverage of CN’s network and “keep us ahead of the industry in this field.”

He said CN’s main-track accidents declined by more than 50 percent in the 10 years up to 2012, but “we know we can and have to do better still.”



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