The risks associated with any mode of transport vary with that mode. The railway industry, much touted as one of this country’s mainstays since Canada became a country, has come under attack in recent weeks for incidents surrounding trains carrying toxic substances found either dangling precariously from a bridge over Calgary’s Bow River, or, more recently, involved in a derailment near the Quebec town of Lac Megantic. The incidents pointed up the danger of trains carrying potentially toxic or even flammable materials near heavily populated areas or large bodies of water.
The latest figures – which don’t even begin to tell the story – have the death toll at 20, with at least 30 people still missing; this, after a train carrying crude oil from North Dakota derailed in Lac-Megantic overnight last Friday, causing a massive fire and explosions. As of this writing, more than 200 residents of the town remain out of their homes.
The train caught fire while parked in Nantes, Que., about 13 kilometres down the road. Local firefighters put out the blaze, but the train later came loose and rolled downhill before derailing in Lac-Megantic early Saturday morning.
The incident brought out safety concerns with who is running the train. An official with the company that owned the train said the engineer was following what he called "standard practice", when he left the train running and unoccupied, standards that the official said appear now to be inadequate and in need of overhauling.
The safety concerns will likely reach a crescendo in the coming weeks; as oil production continues to outpace pipeline capacity, shipment by rail is increasingly common, and critics worry that safety regulations have not kept up with expansion.
The National Energy Board says that as recently as last year, less than 4% of oil shipped through Canada went by rail to coastal refineries and export centres, but that is still more than triple the 2011 figure, and should only increase with the coming years.
Rail shipments of oil in Canada have gone from about 6,000 train carloads in 2009 to an estimated 14,000 this year, according to Statistics Canada and the Canadian Association of Petroleum Producers.
Whether the risks, and the incidents, have a significant impact on the major carriers in this country remains to be seen. But they do not appear to affected the stocks of two of the major carriers. Canadian National Railways (T.CNR) closed trading Thursday at $104.01, a gain of 56 cents per share over the day before, and in the upper end of a 52-week range that peaked in May at $107.57 (the 52-week low came in at $83.45).
As for CP Rail (T.CP), its stock closed Thursday at $129.55, or 38 cents higher than Wednesday’s close. Its high for the year – also recorded in May – was $144.43, compared to a 52-week low of $72.66 on July 12 of last year. This is not meant to suggest that the two major carriers are above the fray; far from it. Safety considerations will have to play a part in the future life of any mode of transport carrying hazardous and even potentially lethal materials, and the human cost when those considerations are ignored could prove catastrophic.
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