Tag Archives: Saint John NB

LATEST DERAILMENT: Crude oil train derails in Saint John, New Brunswick

Repost from CBC News

Minor train derailment in east Saint John leaves some uneasy

Several cars carrying crude oil slipped off the tracks but there was no spill

CBC News, Nov 06, 2015 6:17 PM AT
A minor train derailment in east Saint John on Thursday has some people concerned about what could happen should a major accident occur.
A minor train derailment in east Saint John on Thursday has some people concerned about what could happen should a major accident occur. (Timothy Pennell/CBC)

NB Southern Railway was still on scene in east Saint John on Friday, making repairs after a minor derailment.

On Thursday, three cars loaded with crude oil slipped off the tracks around 10:20 a.m.

While there was no spill, it did have some thinking about the potential for damage.

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A piece of broken track at the site of a minor train derailment in east Saint John. (Timothy Pennell/CBC)

Area resident Chris Likourgiotus said, “I think it would scare anybody having any kind of leak close to any residential or business anywhere in Canada.

“I think this is one reason why it might not be a bad idea to have Canada East pipeline.”

For some businesses next to the tracks, news of the derailment was disconcerting.

Todd Fougere owns a graphics and signs business.

“You know, you do see them time to time come through and put some new boards under and that sort of thing.   But again, I don’t know the rules and regulations so you just hope somebody is looking out,” he said.

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Environmentalist Sharon Murphy says she’s concerned about crude being stored in the middle of the city. (CBC)

However, environmentalist Sharon Murphy says trust shouldn’t have to be earned, especially since there was no consultation over storing so much crude oil in the middle of the city.

“Heaven forbid there’s an explosion, when that happens the citizens don’t have a clue what to do,” she said.

“We are working and living directly beside this very dangerous area in the city, and never were we consulted.”

NB Southern Railway says it will conduct its own investigation into the cause of the derailment.

Because this isn’t a federal line, the Transportation Safety Board will not be conducting an investigation.

The province says the severity of the derailment does not warrant its own investigation.

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    Does zero Bakken crude for Irving Oil indicate a trend?

    Repost from Railway Age
    [Reference:  see the 8/20/15 Wall Street Journal article, Canada’s Largest Refinery Shifts from Bakken Shale Oil to Brent Crudes.  – RS]

    Does zero Bakken crude for Irving Oil indicate a trend?

    By  William C. Vantuono, Editor-in-Chief, August 28, 2015
    Irving Oil Ltd. Saint John, N.B. refinery
    Irving Oil Ltd. Saint John, N.B. refinery

    Irving Oil Ltd., operator of Canada’s largest crude oil refinery, has stopped importing crude oil sourced from the Bakken shale formation in North Dakota and shipped by rail in favor of cheaper crudes from such producers as OPEC, “reflecting a shift in crude costs affecting East Coast refiners during a global slump in oil prices,” the Wall Street Journal recently reported.

    The 320,000-barrel-a-day refinery in Saint John, N.B., one of the biggest by volume in North America, had been receiving 100,000 barrels a day by rail, a high reached two years ago that was only temporarily affected by the Lac Mégantic disaster. (The Montreal, Maine & Atlantic crude oil train that derailed on July 6, 2013, claiming 47 lives, was bound for the refinery). Today, CBR shipments the refinery are zero, a move “that reflects shifting economics in the energy industry even as the price of oil—including Bakken crude—has slumped to six-year lows,” said the WSJ. “About 90% of the crude oil Irving currently buys is shipped by sea from such producers as Saudi Arabia and those in western Africa, with the remainder coming by rail from such western Canadian oil-sands operators as Syncrude Canada Ltd. and Royal Dutch Shell PLC. A year ago, Bakken crude made up about 25% of Irving’s feedstock and in 2013 it supplied nearly one-third of its procurement volume, or about 100,000 barrels a day. ‘The Bakken price has gone up’ relative to other crudes when CBR costs are factored in,’ [an Irving Oil executive] said.”

    “A once-yawning gap, between the cost of oil produced in North America and overseas crudes priced at the Brent global benchmark, has narrowed since 2013,” the WSJ noted. “Refiners on North America’s east coast can now import crude shipped by sea for less than the cost of shipping it by rail from shale oil producers in North Dakota and elsewhere in the U.S.”

    Production of U.S. shale oil, especially that from the Bakken, led to CBR shipments increasing exponentially due to a lack of pipelines. CBR is more expensive than by shipping by pipeline and even by ship, and fewer refiners are willing to pay a premium for CBR. <p< Whether Irving Oil’s decision to abandon Bakken crude for a single refinery reflects a broader trend that will affect CBR movements remains to be seen. Two other refiners have followed suit, but the situation may not be permanent.

    “Refiners PBF Energy Inc. and Phillips 66 both said they increased procurement of overseas crudes at the expense of CBR in the second quarter, though they signaled it is unclear if that will continue throughout the rest of the year,” the WSJ reported. “‘Our ability to source sovereign waterborne crudes was far more economic to the East Coast facilities, and that’s what we did,’ PBF Energy CEO Tom Nimbley said in late July. Phillips 66 CEO and Chairman Greg Garland told investors last month, ‘We actually set [crude-by-rail] cars on the siding. We brought imported crudes in the system.’ But, he added, ‘I’d say given where our expectations are for the third quarter, I’d say cars are coming off the sidings, and we’re going to import less crude.’”

    CBR traffic has dropped substantially compared to last year, “reflecting both the worsening economics of CBR and better pipeline access to refineries on the Gulf of Mexico,” the WSJ noted. According to Association of American Railroads figures, U.S. Class I railroads originated 111,068 carloads of crude oil in the second quarter of 2015, down 2,201 carloads from the first quarter and some 21,000 fewer carloads than the peak in 2014’s third quarter.

     

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      Rail company ends shipping of crude oil in Maine & New Hampshire

      Repost from The Portland Press Herald
      [Editor:  Interesting summary of various effects on rail companies following the Lac-Mégantic disaster.  – RS]

      Irving ends rail shipping of crude oil through Maine

      The cutback is due to a drop in global demand and is not related to the Lac-Megantic rail disaster, the firm says.
      By Tom Bell, July 15, 2015

      Irving Oil has stopped shipping crude oil on railroads through Maine and has no plans to revive the practice.

      The Canadian company, which operates an oil refinery in Saint John, New Brunswick, confirmed the policy change in a June 30 email to the Maine Center for Public Interest Reporting.

      The change means there will be no more oil shipments though New Hampshire and southern and central Maine on Pan Am Railways. In addition, there will be no more oil shipments on the Eastern Maine Railway, which connects with Pan Am at Mattawamkeag and continues through Washington County to the Canadian border.

      The cutback is because of global oil-supply-and-demand issues and is not related to the fallout from the Lac-Megantic rail disaster, Mark Sherman, Irving’s chief operating officer, told the Maine Center for Public Interest Reporting. The U.S. demand for Canadian-produced petroleum products has declined in the wake of an oversupply of oil from domestic and Mideast sources.

      In 2012, Maine railroads shipped 5.2 million barrels of crude oil, but shipments declined sharply after the July 6, 2013 accident in Lac-Megantic, Quebec, when an unattended 74-car freight train carrying Bakken crude oil rolled and derailed, resulting in a fire and explosion that killed 47 people.

      The railroad involved in the disaster, the Montreal, Maine & Atlantic Railway, never carried oil again and went bankrupt. Its successor, the Central Maine & Quebec Railway, also has never carried oil because of political opposition in Lac-Megantic.

      Pan Am, whose trains travel through Portland, carried just 15,545 barrels of oil in all of 2014, according to records the company filed with the Maine Department of Environmental Protection. In 2015, Pan Am has carried 37,128 barrels. All those shipments occurred in February, the last month the railroad delivered oil to the Irving refinery, according to the Maine Center for Public Interest Reporting.

      An official with Pan Am could not immediately be reached for comment.

      John Giles, CEO of Central Maine & Quebec Railway, had been seeking an agreement with Lac-Megantic officials to restart oil train shipments through the Canadian town. On Tuesday, Giles said the railroad does not need to carry oil to be profitable.

      “I was never counting on moving crude oil in the first place,” Giles said.

      Giles said his railroad spent $10 million to upgrade the rail line last year and is spending $6 million this year, with about half of that investment in Maine.

      An investigation after the Lac-Megantic accident found that the tank-car labels understated the flammability of the oil. Twenty-five companies have offered a total of $431 million (Canadian) to settle lawsuits arising out of the disaster. Irving Oil’s contribution is $75 million. The settlement is being considered by U.S. and Canadian courts.

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