Time to ‘aggressively phase out’ old, unsafe tank cars carrying oil, says CN

OTTAWA – The railway industry wants to “aggressively phase out” older model tank cars that have been implicated in several recent accidents, the head of CN Rail’s safety division told an industry forum Monday.

But the consensus at the day-long workshop was that there’s no quick fix for a decades-old problem that has almost 80,000 sub-standard DOT-111 tank cars carrying flammable liquids on North American tracks.

And whatever the solution, the cost eventually will be borne by consumers.

Sam Berrada, director general of safety and occupational health services for CN, told an overflow crowd of industry types, regulators, lobbyists and local first responders that railways ”will continue to push aggressively” for safer, stronger tank cars.

A derailment and fire involving a CN train in northwestern New Brunswick last week has renewed calls for greater safety in the booming oil-by-rail trade, which became an international cause following last summer’s deadly derailment and fire in Lac-Megantic, Que.

Transport Minister Lisa Raitt responded on the weekend by promising the government will formalize the standard for new tank car construction adopted by the rail industry in October 2011.

“Our government’s new tougher standards to the DOT-111 tank cars are part of our commitment to making the rail sector safer,” spokesman Remi Moreau said in an email Monday.

But the government’s announced standards are not new and not tougher – they simply match those already voluntarily adopted by industry more than two years ago.

The forum heard from CN’s Berrada and others that even better cars than the post-2011 model might be in order, although Berrada did praise the performance of three post-2011 cars involved in the New Brunswick derailment.

Moves to date, however, don’t even begin to address the vast majority of older rolling stock.

Governments in Canada and the United States have been reluctant to deal with the huge number of older DOT-111s, in part because of the cost and logistics of an overhaul.

Moreau said Raitt has asked an advisory council “to report back to the minister on additional enhancements and recommendations with respect to the DOT-111.”

Raitt will be working on the standards with her U.S. counterpart, Transportation Secretary Anthony Foxx, Moreau added.

An official with the Canadian Transportation Agency also told the forum the government is considering the idea of a rail industry disaster fund, similar to the fund financed by the shipping industry for environmental clean-ups at sea.

Monday’s forum heard that out of 335,000 tank cars of all types in use in North America, 228,000 are the model known as DOT-111. About 92,000 DOT-111s are used to carry flammable liquids, and only 14,000 of those are the new, stronger cars built after October 2011.

That means 78,000 older DOT-111s remain the workhorse of the oil-by-rail boom.

“You can’t just snap your fingers and change the fleet overnight,” Bob Ballantyne, a career railway man who now works for the Freight Management Association of Canada, said in an interview.

Ballantyne told the forum that railway companies collectively own fewer than 700 tank cars (CN Rail owns just 20), while eight leasing companies own more than 243,000 tankers and shippers own another 79,000.

Retrofitting older cars can cost more than $70,000 each, while new tank cars cost well over $100,000.

“It is, I think, inevitable that safety will be enhanced and there will be increased costs for consignors, consignees, carriers, governments and the general public,” said Ballantyne. “How these increased costs will be allocated across the supply chain remains to be seen.”

Malcolm Cairns, the past president of the Canadian Transportation Research Forum, predicts government intervention will ultimately be necessary to get everyone onboard the pricey make-over of the North American fleet.

Marc Garneau, the Liberal international trade critic, wonders what the government is waiting for.

“There’s no question the responsible thing to do for the government of Canada is to make sure, if these DOT-111 tankers are going to continue, that they have to be upgraded,” Garneau said in an interview.

“Something has to be done because of what we’ve seen in the past six months and what can potentially occur as the amount of oil (being shipped) continues to increase. It’s just too dangerous.”

NDP Transport critic Olivia Chow issued a press release blasting the Conservatives, claiming the government is “recklessly backtracking” on emergency rules imposed last summer after the Lac-Megantic crash, while failing to move on the tank car safety issue.

“Keeping citizens safe is a core responsibility of any government,” Chow said in the release.