Company postpones plans for trial run of oil by rail to Churchill

CHURCHILL, Man. – Plans for a test shipment of crude oil by rail to a port in northern Manitoba have been put on hold, Global News has learned.

Opposition to a plan to ship light sweet crude by rail through Churchill has been growing in the aftermath of the Lac-Mégantic railway disaster.

Private railway company OmniTrax, which owns and operates the Port of Churchill, wants to move oil by rail to the port on Hudson’s Bay for shipping to refineries. It had planned a test shipment of 330,000 barrels this fall but announced Tuesday the trial run won’t be going ahead.

But the company remains committed to transporting oil by rail and loading it on ships in the port in the long term, OmniTrax president and COO Darcy Brede told Global News Tuesday.

The company has said it needs to diversify products shipped through the port. The oil proposal has the most market support, Brede said.

Oil from Alberta and the Bakken oilfields in North Dakota would be shipped north by rail and then either held at the port or loaded directly into waiting ships.

Both the provincial government and Churchill MP Niki Ashton, a New Democrat, have publicly denounced the plan.

Environmentalists have expressed concern about the damage an oil spill could cause.

“There are something like 350 water bodies within 10 metres of the track between The Pas and Churchill, so there is a tremendous risk of oil being spilled into the water, and it just won’t be removed,” said Eric Reder of the Wilderness Committee in Manitoba.

Jenafor Azure, a sled-dog tour operator, said she’s opposed to the plan because of concerns about the quality of the tracks.

“I’ve seen my groceries derail on that track; I’ve seen my supplies spill. I can’t envision oil.”

Azure wants to see upgrades to the railway line and the port and more emergency services in Churchill before any plan to ship crude goes ahead.

Penny Rawlings, who operates the Arctic Trading Company in Churchill, also said the town doesn’t have the people or the resources to deal with a disaster.

OmniTrax has spent $60 million repairing the line over the last five years and it is “vastly improved,” Brede said.

OmniTrax officials also pointed out the province was part of a study earlier this year that specifically mentioned crude oil shipments as a possibility for the future of Churchill.

Barry Prentice, a University of Manitoba supply chain management professor, said fear is driving opposition to shipping oil, but the risk is quite small.

“The speed is restricted there. You can only travel 10 miles an hour (16 km/h), mainly because of the roadbed. So if there is a derailment, it’s not likely the cars are going to spring a leak, because they are moving slowly,” he said.

Potentially dangerous goods are already shipped on the railway line, Prentice added, including diesel fuel, aviation gas and heating oil.

He doesn’t feel the accident in Lac-Mégantic, where oil tankers exploded, destroying the Quebec town’s centre and killing 47 people, is relevant to the debate.

“The nature of that accident, per se, had nothing to do with oil. It was a runaway train.”