CN loses ap­peal, must pay spill costs

The Globe and Mail Metro (Ontario Edition) - - Report On Business - ERIC ATKINS RAIL­WAY IN­DUS­TRY RE­PORTER

On­tario’s Min­istry of the En­vi­ron­ment or­ders rail­way to re­im­burse tax­pay­ers $620,000 for two 2015 de­rail­ments

Cana­dian Na­tional Rail­way Co. has lost a bid to over­turn an or­der to re­im­burse On­tario tax­pay­ers for costs as­so­ci­ated with two oil train ex­plo­sions and spills in North­ern On­tario.

The $620,000 bill levied by On­tario’s Min­istry of the En­vi­ron­ment and Cli­mate Change cov­ered ex­penses from the af­ter­math of the two 2015 train de­rail­ments near Sud­bury. A to­tal of 4.3 mil­lion litres of crude oil were re­leased in the two crashes, ac­cord­ing to the Trans­porta­tion Safety Board (TSB).

CN ap­pealed the or­der to pay $530,000 of the bill, ar­gu­ing the costs of govern­ment salaries, lab­o­ra­to­ries and ad­min­is­tra­tion were un­rea­son­able or beyond the author­ity of the prov­ince to seek.

On­tario’s En­vi­ron­men­tal Re­view Tri­bunal heard CN’s ap­peal in July and sided with the prov­ince. In a de­ci­sion dated Oct. 6, the tri­bunal said the costs levied against CN were “rea­son­able” and “fully re­cov­ered from the pol­luter in light of the work done.”

The tri­bunal noted CN was spend­ing “many mil­lions of dol­lars” to con­duct the “vast ma­jor­ity” of the spills’ cleanup. “This was not a case where the [pro­vin­cial govern­ment] it­self was car­ry­ing out the clean-up,” the rul­ing said. “Rather, the [govern­ment] was over­see­ing and mon­i­tor­ing the cleanup ef­forts in its reg­u­la­tory ca­pac­ity un­der the En­vi­ron­men­tal Pro­tec­tion Act and li­ais­ing with the pub­lic and other rel­e­vant agen­cies.”

Both fiery train de­rail­ments, which oc­curred in the same vicin­ity, were caused by track problems. The Feb. 14 de­rail­ment was caused by a failed rail that had un­de­tected cracks. The sec­ond, on March 7, was caused by a botched rail re­pair that was made a few days ear­lier, ac­cord­ing to the TSB. The trains were 94 and 100 tank cars in length, haul­ing crude to the Valero En­ergy Corp. re­fin­ery in Lévis, Que., from Al­berta.

Pa­trick Wal­dron, a CN spokesman, said the com­pany is re­view­ing the de­ci­sion. He said CN has spent $35-mil­lion clean­ing up the river and sur­round­ing area fouled by the March 7 de­rail­ment, and the work con­tin­ues. “We re­main com­mit­ted to the full cleanup of the site,” Mr. Wal­dron said by phone.

The Min­is­ter of En­vi­ron­ment did not im­me­di­ately re­spond to an in­ter­view re­quest on Thurs­day.

Among the costs CN dis­puted was $180,000 to test water tox­i­c­ity. The rail­way’s lawyer ar­gued the re­sults of the lab work had no ef­fect on the cleanup be­cause CN was re­ly­ing on its own test­ing and those re­sults were avail­able more quickly. CN also ar­gued the prov­ince was test­ing water in ar­eas that showed no signs of con­tam­i­na­tion.

The prov­ince ar­gued the sam­pling was needed to as­sure the peo­ple in a re­gion who de­pend on tourism and fish­ing that the water was safe to drink. The prov­ince de­nied CN’s claim the test­ing was con­ducted as a “pub­lic re­la­tions” ex­er­cise.

The Mattagami First Na­tion has sued CN for the en­vi­ron­men­tal dam­age caused by both crashes.


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A CN train haul­ing crude to the Valero En­ergy re­fin­ery in Lévis, Que., de­railed near Gogama, Ont., in 2015.

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