Policy

Yet Another Oil Tanker Derailment May Help the Keystone XL Pipeline


Another train carrying crude oil went off the tracks today, adding to a pile of incidents that could make lawmakers reconsider the merits of the controversial Keystone XL pipeline. This time nobody was hurt when a Norfolk Southern (NSC) train derailed in western Pennsylvania on Thursday. But it’s part of a troubling pattern that suggests the record volume of crude being carried by rail is coming at a high cost. (To get a sense of the growth, look at these charts.)

The recent spate of incidents had already caught the attention of lawmakers in Washington. A Senate subcommittee was scheduled to hold a hearing today on passenger and freight rail safety, only to be delayed by the same bad weather that may have been a factor in the Pennsylvania accident. Last month the National Transportation Safety Board (and its Canadian counterpart) issued recommendations to improve safety, from stronger cars to better emergency response plans. The consequence of doing nothing, as NTSB Chairman Deborah Hersman explained, could be a “major loss of life.” State legislators have also responded by hiring more rail inspectors and beefing up emergency plans.

That’s all for the good, but the reality is that the nation’s rail system is straining to handle a 400 percent increase in crude oil shipments since 2005. Many of the cars simply weren’t designed to handle flammable liquids, leaving them vulnerable to bursting into a fireball in a crash (as happened in Quebec last year, killing 47 people). Improving or replacing them is costly and doesn’t diminish the risk of derailment in the first place.

Faced with that reality, Americans may decide they’d prefer to see more crude being carried by pipeline—specifically TransCanada’s (TRP) proposed Keystone XL, which would carry some 800,000 barrels from Alberta to the Gulf of Mexico every day. Whether the $5.4 billion pipeline would create jobs or increase the environmental damage of the tar sands is open to debate. But a pipeline may be a less deadly way to transport volatile materials.

It certainly appears that way to the U.S. Department of State. In its much-awaited study on Keystone released last month, the State Department estimated that not building the pipeline could result in “an additional 49 injuries and six fatalities” because of rail accidents, vs. “one additional injury and no fatalities” if it went ahead. If the current pace of accidents continues, that projection may turn out to be a modest one.

Does that mean the fuel from Alberta’s oil sands is safer and more climate-friendly than shale gas? Not really. A pipeline, like a railroad, is only a delivery system. It, too, can get damaged with devastating consequences, as we saw in a 2010 rupture that sent 20,000 barrels into Michigan’s Kalamazoo River.

But after considering a growing list of rail accidents that could one day result in disastrous consequences, American lawmakers may decide that completing the Keystone XL is safer than not.

Brady_190
Brady is a senior editor for Bloomberg Businessweek in New York.

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Companies Mentioned

  • NSC
    (Norfolk Southern Corp)
    • $117.13 USD
    • 0.78
    • 0.67%
  • TRP
    (TransCanada Corp)
    • $49.38 USD
    • -0.17
    • -0.34%
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