On the heels of Canada’s worst ever crude-by-rail spill, transportation company Torq Transloading has announced plans to build a $100-million rail hub in central Saskatchewan over fall 2013.
Torq Transloading CEO Jarrett Zielinski is defending the project, noting that shipment of oil by train is good practice when done safely, and is a viable alternative to pipelines, particularly as a way to avoid lengthy regulatory processes.
The biggest cost of crude-by-rail is track construction and maintenance costs.
Defence of the new Saskatchewan project has been heightened following the July 6, 2013 train derailment in Lac-Mégantic, Quebec. A driverless train demolished the town’s centre, killing an estimated 47 people and spilling some 7.2 million litres of crude oil into the environment.
Torq Transloading’s proposed rail hub is set for Kerrobert, about 185 kilometres west of Saskatoon. The Kerrobert Rail Terminal will more than quadruple the company’s shipping output to 168,000 barrels-per-day.
“We feel that Kerrobert is strategic in that it allows maximum diversity and flexibility for crude-by-rail out of Western Canada,” Zielinski said in an August 14, 2013 statement to media. “It is as far south and east geographically in Canada that allows us to not only access vast amounts of pipeline delivered crude oil but also it allows us to access significant quantities of heavy, undiluted crudes in the Lloydminster-Kerrobert corridor.”
Calgary-based Torq Transloading is one of just three companies that have proposed new crude-by-rail terminals following the Lac-Mégantic rail disaster. Gibson Energy Inc. and U.S. Development Group LLC are eyeing a 140,000-barrel-per-day rail terminal in Hardisty, Alberta, and Keyera Corp. joins Kinder Morgan Energy Partners LP for a 40,000-barrel-per-day terminal in Edmonton.
Canadian rail companies shipped 86,000 carloads of petroleum products in the second quarter of 2013, up 18 per cent from 2012 and 62 per cent from 2011, according to Statistics Canada.
Following the Lac-Mégantic rail disaster, Transport Canada has announced that it plans to hire additional railway safety inspectors, and rail personnel will no longer be able to operate trains alone.