A train disaster in Quebec on July 6 is prompting debate about the safety of shipping crude oil by rail or pipelines, Bloomberg reports.
Authorities are investigating the derailment and subsequent explosion of a Montreal, Maine & Atlantic Railway train, which was hauling 72 carloads of crude oil to Irving Oil’s Saint John refinery in New Brunswick. The train crashed and burned near the center of Lac-Megantic, forcing the evacuation of 2,000 people and burning the surrounding buildings. As of today, five people are confirmed dead and 40 people remain unaccounted for; a criminal investigation is under way.
Following the mishap, Quebec’s Green Party demanded stricter regulations and an energy industry association predicted “tough scrutiny” is ahead for rail carriers. The accident is particularly significant in the debate for the proposed construction of the Keystone XL pipeline, which would move oil sands bitumen from Canada and the northern U.S. to the Gulf Coast. The project has been delayed by environmental and regulatory concerns.
“This is another data point that shows how much costlier and riskier rail is compared to pipelines and will probably move Canada closer to having an energy strategy,” John Stephenson, fund manager with First Asset Investment Management, told a Bloomberg reporter.
“It’s been a real shame that a lot of the public and especially the activists have pushed the public to sway so much from pipelines which are likely much, much safer over time,” said Arthur Salzer, CEO of Northland Wealth Management.
“Pipeline companies will use this to point out the advantages and safety records of pipelines,” said Bob Schulz, a professor at the University of Calgary’s Haskayne School of Business, in an interview with a Bloomberg reporter. “It gives those companies an additional point to support their argument.”
“Rail will continue, and its safety problems can’t be ignored,” said Anthony Swift, an energy analyst with the Natural Resources Defense Council, in a telephone interview with Bloomberg.