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Canada Accelerates Phaseout of DOT-111 Crude Oil Deliveries

Canada announced an accelerated safety schedule Monday for stopping railway crude oil deliveries with an old generation of accident-prone tank cars that had a role in a Quebec tragedy three years ago.

Transport Minister Marc Garneau set Nov. 1, a deadline six months earlier than previously planned, as the starting date for the ban against the legacy rolling stock, a culprit known in Canada as DOT-111.

A statement by Garneau’s department said, "Legacy DOT-111 tank cars are considered to be the least crash resistant tank cars still being used in crude oil service. They will be replaced by tank cars such as the TC-117, which is designed with a number of additional safety features including thicker steel, head shields, thermal protection and top fitting protection."

The action follows three years of investigations, studies and discussions with industry and counterpart safety authorities in the United States. The storm of concern was ignited by a July 2013 derailment, explosion and fire by a runaway oil train that caused 47 deaths and incinerated the downtown of Lac-Megantic in eastern Quebec (see Daily GPIJuly 9, 2013).

The wrecked train was operated by an American firm carrying oil from the western U.S. to a refinery in New Brunswick as a bargain replacement for imported overseas supplies, which at the time fetched a high premium over prices for North American production.

The accelerated timing for the new Canadian safety rules was not expected to have significant effects on current oil traffic patterns. Since the Quebec inferno, surpluses and falling prices ended the market conditions that led to a temporary boom in railway tank car deliveries. As in the U.S., the traffic has dropped off sharply in Canada.

Western oil supply areas -- chiefly in Alberta -- have railway loading facilities for 754,000 b/d but only shipped 140,000 b/d in 2015 or about 24% less than in 2014, show records of the Canadian Association of Petroleum Producers.

But even the reduced volumes of oil traveling on tracks filled about 146,000 tank cars in Canada last year, said Transport Canada. The department estimates that the railway industry still has a North America-wide inventory of 28,000 of the old DOT-111s and adds that the aging train hardware can still be used for other cargos rated as less hazardous than oil.

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