CN Rail, Nexen and the federal government have been working on a plan to ship bitumen from the tar sands by train through British Columbia, according to documents obtained by Greenpeace under Access to Information legislation.

According to the government briefing note prepared for a March 1, 2013 meeting between Natural Resources Canada deputy minister Michael Keenan and CN Rail assistant vice president David Miller: “Nexen is working with CN to examine the transportation of crude oil on CN’s railway to Prince Rupert, British Columbia, to be loaded onto tankers for export to Asia.” Nexen, which has significant holdings in the tar sands, was recently bought by the Chinese state-owned oil company CNOOC.

CN says it has “ample capacity” to bring seven trains, each carrying 100 cars loaded with bitumen, to the deep water port of Prince Rupert in northern BC. CN’s powerpoint presentation at the meeting states that this option could carry a comparable amount of oil to Enbridge’s Northern Gateway.

The Gateway pipeline is mired in controversy and may never get built due to intense public opposition. CN knows that this oil-by-rail proposal, which runs parallel to Gateway’s route, will be controversial. One hundred and sixty First Nations have signed the Save the Fraser declaration which bans the movement of tar sands through their lands by pipeline or rail. Similarly, the Coastal First Nations have banned tankers carrying tar sands crude from transiting their lands and waters.

Furthermore, a January 2013 letter from environmental groups to CN urged the company to not pursue oil-by-rail through BC. The letter ended with: “Should CN decide to try to move forward with its proposal, it would face major opposition and risks to the company. We urge you to stop any forward movement with shipping tar sands oil by rail through British Columbia."

The response from CN Rail CEO Claude Mongeon, sent February 20th (9 days before this meeting with NRCan officials) stated “We currently do not carry crude oil to the West Coast simply because no customer has yet asked for us to do so. But if infrastructure was permitted for this purpose on the West Coast and a request made to CN, we would respond and do what our business mandate and common carrier obligations call for – move these products as safely and efficiently as we can for the benefit of all Canadians.”

The “infrastructure” issue is important, because the company will likely face stiff opposition to any attempt to build the required unloading docks at the Prince Rupert port. According to a separate set of Transport Canada briefing notes obtained by Greenpeace: “The transportation of oil by rail does not trigger the need for a federal environmental assessment under the Canadian Environmental Assessment Act (CEAA), however, proposals to construct new infrastructure to support the activity may be required to determine CEAA’s applicability.”

The Transport Canada briefing notes downplay the risks of moving oil by rail. They were, however, written prior to the Lac Megantic disaster, which has heightened public awareness and concern regarding the movement of oil by rail. In California, for example, a 50,000 barrel per day oil-by-rail offloading project was recently bumped up to a full environmental assessment based on local concerns over tar sands oil. And a spill of bitumen from a train poses the same risks to salmon streams and local communities that has energized the opposition to Enbridge.

Rail tanker cars after the Lac Megantic tragedy

It would appear that the rail industry recognizes that they are in for a tough fight, and has begun to ramp up its lobbying power accordingly. On August 7, the Canadian Railway Association added veteran energy industry lobbyist Velma McColl to their team. According to the federal lobbyist registry, she will be lobbying the federal government on behalf of the railway association with respect to:

  • Polices impacting on the movement of dangerous goods, including voluntary and regulatory requirements, by rail operators (Class 1, local and regional railways).
  • Policies being developed to ensure regulations governing safety measures and safety training for dangerous goods transportation are adequate and conducive to safe railway operations.

It is likely not a coincidence that McColl is also registered as a lobbyist for Nexen, where she advocates on their behalf on a variety of issues, including “Canadian Government policy & programs on West Coast pipeline & export facilities”.

Oil industry money and lobbying power hasn’t been able to overcome opposition to the Gateway pipeline, however, and won’t be able to punch a virtual pipeline through BC by putting the oil on trains without a fight.