July 19, 2013

Deadly derailment won't stop oil on trains

Without new pipelines in North America, there's no other way to transport vast amounts of crude from the middle of the continent to its coasts.

The Associated Press

NEW YORK, NY — A fiery and fatal train derailment earlier this month in Quebec, near the Maine border, highlighted the danger of moving oil by rail, a practice that has grown exponentially as a result of the oil boom and will continue to expand, experts say.

click image to enlarge

In this July 12 photo, work continues at the crash site on in Lac-Megantic, Quebec of a train that derailed, igniting tanker cars carrying crude oil that killed fifty people. Trains have become an unexpected yet vital way to move oil from the continent's midsection to refineries along the coasts. However, since the July 6 tragedy, there have been calls for tougher regulations, stronger rail cars and more pipelines. (AP Photo/The Canadian Press, Ryan Remiorz)

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This year, more trains carrying crude will chug across North America than ever before — nearly 1,400 carloads a day. In 2009, there were just 31 carloads a day.

U.S. and Canadian drillers are producing oil faster than new pipelines can be built. As a result, trains have become an unexpected yet vital way to move this bounty of energy from the continent's midsection to refineries along the coasts. Not since the dawn of the petroleum age, when John D. Rockefeller clashed with railroad barons, have trains been so important to the oil market.

Since the July 6 tragedy in Lac-Megantic, where a runaway train carrying 72 carloads of crude derailed and killed 50 people, there have been calls for tougher regulations, stronger rail cars and more pipelines.

But experts say the oil industry's growing reliance on trains won't be derailed anytime soon. Unless new pipelines are built, there's just no other way to get vast amounts of oil from North Dakota and Rocky Mountain states to refineries along the coasts, which are eager for cheaper, homegrown alternatives to imports brought in by boat.

"Stopping crude by rail would be tantamount to stopping oil production in a lot of the places it is now being produced," says Michael Levi, who heads the Council on Foreign Relations' program on energy security and climate change.

Even safety experts worried about the dangers of shipping oil by rail acknowledge that the safety record of railroads is good — and improving. The scope of the Lac-Megantic disaster, which is still under investigation, appears to have been the result of uniquely bad circumstances, these experts say.

"Rail is going to remain a significant part of the way we move crude around the country for a long time," says Jason Bordoff, head of Columbia University's center on global energy policy. "I don't think this rail accident will significantly change that."

The unattended Montreal, Maine & Atlantic Railway train was parked overnight on a rail line before it came loose, hurtling down a seven-mile incline and slamming into the center of Lac-Megantic. Donald Ross, chief investigator for the Transportation Safety Board of Canada, said Friday it remained unclear whether mechanical problems or human error were to blame for the insufficient brake force.

In the first half of this year, U.S. railroads moved 178,000 carloads of crude oil. That's double the number of the same period last year and 33 times more than the same period of 2009. The Railway Association of Canada estimates that as many as 140,000 carloads of crude oil will be shipped on Canada's tracks this year, up from 500 carloads in 2009.

Last year, 663 rail cars carrying hazardous materials derailed or were damaged in the U.S., a decline of 38 percent from 1,072 incidents in 2003, according to the Federal Railroad Administration. That's comparable to the total number of train accidents per million miles traveled, which fell 43 percent over the same period, and the number of derailments, which fell 40 percent.

Whether crude traffic on the rails will continue to grow quickly depends on oil prices around the globe, but refineries are gearing up for more.

(Continued on page 2)

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