Train derailmenT, explosions force

evacuaTion of alberTa communiTy

Tanker cars on a train carrying propane and oil derailed and caught fire outside of Edmonton on Saturday, forcing the evacuation of a small community.The derailment caused explosions, through no injuries were reported. Fire and hazmat crews were on the scene, but firefighters have since opted to let the flames burn themselves out.This fire needs to be extinguished by consuming the product,” said Jim Phelan, fire chief of Parkland County. “We’re going to let it burn itself out.”The train belongs to Canadian National Railway Co. It derailed in Gainford, a village about 90 kilometres west of Alberta’s capital, at around 1 a.m. MT Saturday. The train was en route to Vancouver from Edmonton.Thirteen tanker cars went off the track, according to Louis-Antoine Paquin, a spokesman for CN. Nine of those are pressurized tank cars filled with liquefied petroleum gas in the form of propane, and three of them are on fire.Four of the derailed tank cars are loaded with oil and have “no indications of any leaks,” he said. Mr. Paquin would not say to whom the shipment belonged.“CN will clean this up, remediate any damage,” said Jim Vena, CN’s chief operating officer, at an evening news conference.Carson Mills, a spokesman for Parkland County, said fire and hazmat crews were trying to “contain” any further explosions. “We’ve already had at least a couple of explosions already today,” he said earlier Saturday. “I heard from residents it was a bit of a fireball going across the highway.”About 100 Gainford residents were evacuated from their homes. Mr. Phelan said it could be anywhere between 24 and 72 hours before they’re able to return home.Gainford, which sits on the Yellowhead Highway, is now in a state of emergency. The highway is closed in the area.

The Transportation Safety Board of Canada said it sent a team of investigators to the site, but had been unable to examine the wreckage.CN said the track was “ultrasonically” tested in September and visually inspected Thursday. “No issues were found in any of the inspections,” Mr. Paquin said in a statement. The train was inspected in Edmonton Friday. No issues were detected. It passed over various “flaw detectors” embedded in CN’s right-of-way as it moved westward, “again with no issues.”The rail company said it notified local first responders in Parkland County “within minutes” of the derailment, providing them with initial information of the train’s contents. CN does not yet know what caused the derailment.Three of the four cars carrying crude were Dot-111 cars, built last year, Mr. Paquin said. This means they are more puncture-proof than their older counterparts. CN is still trying to ascertain the model of the fourth car that was carrying oil.CN’s chief operating officer Jim Vena flew in overnight to lead the response, Mr. Paquin said. The executive is being “assisted by” regional senior vice president Mike Cory, chief safety and sustainability officer Michael Farkouh, and other senior executives.Parkland County and Yellowhead County fire crews went to the scene

alongside the City of Edmonton Fire Department Hazmat crew and Air One from Edmonton, according to Parkland County. Officials from Alberta Environment and Sustainable Resource Development also went, Mr. Mills said.In August, 2005, CN spilled about 4,400 barrels of heavy fuel outside Wabamun, about 20 kilometres northwest of Gainford. Much of the 2005 spill ended up in Wabamun Lake.Energy companies are increasingly turning to rail to move oil and gas to market, arguing North America’s pipeline network needs to be expanded. But shipping hazardous materials on railways comes with huge risk.Forty-seven people in Lac-Mégantic, Que., were killed in July when a train carrying 8.1 million litres of light crude from North Dakota crashed in town. Montreal, Maine & Atlantic Railway Ltd. owned that train.The federal Conservative government plans to make rail companies and those shipping goods on trains carry more insurance.“As efforts to clean up and rebuild Lac-Mégantic demonstrate, railway companies must be able to bear the cost of their actions,” the government said in the Speech from the Throne, delivered Wednesday.“Our government will require

shippers and railways to carry additional insurance so they are held accountable. And we will take targeted action to increase the safety of the transportation of dangerous goods.”In response to Prime Minister Stephen Harper’s pledge, CN spokesman Mark Hallman on Thursday said: “As part of sound business practices, CN believes that its liability insurance coverage of more than $1-billion is sufficient to reflect the size and scope of its 20,000-mile rail network spanning Canada and mid-America.”Canadian Pacific Railway Ltd. declined to comment on the Throne Speech.Trains carried fewer than 20,000 barrels oil a day in the United States in 2008. But by the end of last year, roughly 500,000 barrels of oil per day moved on the rails.The energy industry expects nearly 10 per cent of the oil they produce in the United States will move by train in 2013. This is partly because projects like TransCanada Corp.’s proposed Keystone XL to the U.S. Gulf Coast are stalled, and partly because by using rail rather than pipeline, shippers have more flexibility in where the cargo ends up.Trains have a death rate three times higher than pipelines, and have a fire or explosion rate nine times higher when moving liquids, according to the U.S. State Department. Pipelines

w w w.oilf ieldnews.c a

Published By: NEWS COMMUNICATIONS since 1977 Wednesday October 23rd, 2013

Sign Up with the Oilfield News Online

have the best safety record compared to other modes of transportation, according to the U.S. Pipeline and Hazardous Materials Safety Administration. It is a watchdog that harshly criticized Canadian pipeline giant Enbridge Inc. after it leaked oil about 20,082 barrels of oil into waterways in Michigan in 2010.Experts have also considered the frequency of spills. Railways had a spill rate 34 times higher than U.S. hazardous material pipelines between 2005 and 2009, according to Diana Furchtgott-Roth, a senior fellow with the Manhattan Institute, a right-leaning New York City think tank. Those pipelines had 0.61 spills per billion barrel miles, she found. Railways had 20.5, she said.The rail industry did its own math and came up with a narrower gap – a spill frequency of 2.6 times.Canada has hosted a slew of leaks in 2013. Cars on a CPR train carrying flammable petroleum products derailed in Calgary in September, prompting a small evacuation. The cars did not leak and no one was hurt. In July, after a massive flood swept through Calgary, six CPR train cars derailed and a bridge partially collapsed. Petroleum products were on board.In May, five tank cars containing crude oil derailed near Jansen, Sask. One car leaked about 575 barrels of oil. The train belonged to CPR. The company also had a derailment in Ontario in April, spilling 400 barrels of oil. In March, CPR cars derailed and spilled oil in Minnesota. About 24 barrels of oil spilled, after 14 of

the train’s 94 cars went off the tracks.

Why b.c., alberTa are ending Their

pipeline sTandoff

New thaw seen in getting Alberta’s oil sands bitumen to West CoastLast week saw a remarkable shift in the pipeline standoff between B.C. and Alberta over the contentious problem of getting Alberta’s oil to B.C. ports, for shipment to Asia.Until recently, government officials on both sides of the Rockies had described this particular interprovincial relationship as “frosty.” With neither side even willing to seriously discuss it.But now, with B.C.’s spring election fading in the rear-view mirror, it appears the Liberal government’s hard line over transporting Alberta’s oil is starting to defrost — rapidly.Rhetoric is being replaced by actual negotiations and if the talks continue as they appear to be going, the end result will almost certainly be bitumen from Alberta’s oil sands making its way to West Coast ports, assuming of course that other regulatory hurdles can be surmounted.Much to the chagrin of environmental groups and other pipeline critics, the question no longer appears to be if Alberta’s bitumen will make its way through B.C. but rather when it will happen and how it will be transported.B.C. Premier Christy Clark and Alberta’s Alison Redford met in person in Kelowna back in July to set the stage for this relationship warm-up.

The get-together was political reset after nearly a year of acrimony because of (election-bound) B.C.’s unwillingness to get behind pipeline projects like Enbridge’s Northern Gateway, and because of Alberta’s unwillingness to move on Clark’s demands for a greater share of the benefits from these projects.At one point, Redford accused Clark of “dividing Canada” with her demands for a larger share of the pie.But that was then, this is now. The two leaders have suddenly agreed to form a working group of senior bureaucrats to hammer out their differences and, as Clark and several of her ministers put it, to find a way to “get to yes.”What’s changed?If you don’t believe that’s the direction they’re headed you need only read through the terms of reference released last week for the working group doing the negotiations.The document states two simple goals, clearly spelled out in black and white: One is opening up new markets and expanding export opportunities for oil and gas; the other is developing the oil and gas sector in both provinces.The reality is that you can’t accomplish either of those goals without finding a way to get the product to market.And to drive that point home, the transportation section spells out the idea of using rail as an alternative for moving oil if pipeline projects don’t get approved.It’s all a far cry from the

transportation stalemate that was in place for most of the past year when Clark’s Liberals were playing the environmental card and saying B.C. was the one assuming all the oil spill risks in this relationship.So what’s changed?Probably the biggest difference is Christy Clark is no longer fighting an election campaign. In B.C., the official campaign period lasts 28 days, but the reality was that Clark and her Liberal government had been in campaign mode for more than two years.Enbridge’s proposed Northern Gateway pipeline, which would transport Alberta bitumen to a new West Coast port near Kitimat, still has many hurdles to overcome, including environmentalists who have been lining up at the regulatory hearings this summer in Terrance. (Robin Rowland / Canadian Press)Every initiative, every political position, every answer was being viewed through a campaign lens.As such, there was no way she could appear pipeline friendly and still hope to win an election in a province with such vocal opposition to pipelines. Particularly the proposed Northern Gateway project given the heightened sensitivity around the oil sands as well as Enbridge’s recent history of pipeline spills.But it is not just B.C. that has changed. Alberta also appears to have realized it needs to make the relationship work if it is to efficiently get its oil to market, and Redford has been talking a

tougher game of late about more stringent environmental regulations to meet at least some of her critics.The proposed Keystone XL pipeline from Alberta to the Gulf of Mexico remains stalled, with no approval as of yet from the U.S. government. And though there has been talk of Alberta piping its oil east, through a reversal of the main TransCanada pipeline, that plan would come with a huge price tag, including the added time and cost of shipping Alberta oil from Eastern Canada down through the Panama Canal and then across the Pacific.Tensions running highNone of this is to suggest pipeline construction can begin tomorrow. There are still roadblocks ahead for both provinces. Environmental concerns, First Nations challenges, not to mention that pesky B.C. demand of a “fair share of the benefits” that make up Clark’s five conditions for approving heavy oil pipelines, all need to be dealt with.But what we seem to be seeing now is a desire by both B.C. and Alberta to sit down and come up with a plan for getting past those hurdles.Speaking to CBC Radio recently, B.C. Environment Minister Mary Polak was very candid about this. The environment ministry is “not the ministry of No,” she said. “We believe the five conditions can be met.”Of course, being willing to talk about an issue and actually getting somewhere with it can be two very different things.

Despite assertions by federal ministers, B.C. voters still appear to be largely opposed to a big increase in the movement of oil across the province and along coastal waterways.In what might be a sign of things to come, protesters from Greenpeace and First Nations groups effectively shut down the Kinder Morgan terminal in Burnaby last week.This is the facility that would see a threefold increase in oil shipments if yet another pipeline project, the proposed Trans Mountain expansion, is approved.Tensions are already running high, and a report earlier this month about the sorry state of marine oil spill response along the B.C. coast set the stage for even more oil-related angst.At the moment, the B.C.–Alberta relationship over pipelines and oil is definitely warming. But once reality starts to intrude it may not take all that much in the way of public pushback to put it back in the deep freeze.

Toyo engineering signs mulTi-year oil

sands deal

TOYO Engineering Corporation (TOYO), through its Canadian subsidiary TOYO Engineering Canada Ltd., has signed an Engineering, Procurement, Construction (EPC) contract with JACOS (Japan Canada Oil Sands Limited) for a 20,000 bbl/day Steam Assisted Gravity Drainage (SAGD) production processing facility (expandable to 30,000 bbl/

day) in the Hangingstone area, near Fort McMurray, Alberta.The JACOS Hangingstone Project (with Nexen Energy ULC, a wholly owned subsidiary of CNOOC Limited, having 25% stake in the project) includes a central processing facility, utilities and infrastructure. TOYO will be performing the detailed engineering, procurement and the construction with completion targeted 2.5 years after contract signature.TOYO has performed major projects in the global oil and gas industry for over 50 years and, with the EPC scope of work for the JACOS Hangingstone Project, TOYO will be advancing its business in the Canadian oil and gas sector.“We are very pleased to be working with JACOS on such an important project in the Alberta oil sands,” said Taro Takahashi, President TOYO Engineering Canada Ltd. Key in the success of the project will be the delivery of the construction phase. “This is an exciting time for TOYO,” said Al Wahlstrom, VP Major Capital

Project Toyo Engineering Canada Ltd. “The Hangingstone Expansion Project will be a significant EPC project for us in the oil sands and we look forward to building an integrated delivery team with our contractors and our client project team acting in concert to deliver success for JACOS and us all.” The construction scope of the contract will be executed by a strong and dynamic team from TOYO, JV Driver, and key equipment manufacturers leveraging off each companies’ experience and expertise.

Looking to Advertise in the next upcoming Oilfield News

Release?

Need to update your advertisement?

Would you like to receive the publication by email?

Didn’t receive your subscription?

Give us a call at

1-800-293-9865