Companies & Industries

Does CN have a secret agenda to transport oil to the West Coast?

CN claims no one is interested

(Mathieu Tremblay/Getty)

(Mathieu Tremblay/Getty)

There has been a lot of money and effort put into building pipelines to transport oil from Alberta to the Pacific coast. So you’d think there’d be at least some interest in using the go-to alternative: rail. After all, Canadian National Railway operates a line that parallels the route of the Northern Gateway pipeline which, even if it gets approved, won’t be in service until at least 2018.

But it turns out, no one is interested in transporting oil by rail across B.C.—or so says CN. That’s despite the fact premiers Christy Clark and Alison Redford, in a backgrounder to their recent agreement on the ground rules for building pipelines, warned that oil may end up crossing B.C. by train en route to Asia regardless of whether the Northern Gateway or Trans-Mountain Expansion projects go ahead.

“We’re not involved in anything on the West Coast, zero, zilch,” CN vice-president, petroleum and chemicals James Cairns told the National Post the day after the premiers’ meeting in October. No customer is actively requesting CN move crude oil to the West Coast for export, spokesman Mark Hallman reiterated in an e-mail to Canadian Business. There is no infrastructure in place on the coast to transfer crude oil from rail cars to ships, he added.

Environmental opponents of bitumen exports aren’t convinced. Documents made public by Greenpeace through access to information legislation indicate Nexen Inc. asked CN to explore shipping Gateway-sized loads to Prince Rupert. “They’re trying to avoid what happened to [Northern Gateway proponent] Enbridge where opposition had time to build up,” says Keith Stewart, a Greenpeace researcher. “I think what they’re hoping is to present it as a fait accompli.” Keeping the issue on the down low doesn’t allow for people to mobilize opposition, including physical blockades, he says.

Others think CN simply wants to avoid such confrontation. Businesses in CN’s position “are unlikely to get into what is seen as a political fight. It doesn’t benefit them,” says Kenneth Green, senior director of the Fraser Institute’s Centre for Natural Resources. “They’d rather quietly operate and move cargo out.”

CN rejects any claim of playing down its intentions. “CN will continue to respond to new customer demand to transport crude oil to market,” Hallman says.
oil by rail
Transport Canada data shows there has already been a marked increase in carloads of petroleum products moving around B.C., all of it destined for domestic and American customers. Asian crude oil export volumes would be much higher.

The public’s reservations around rail—heightened following the deadly derailment in Lac-Megantic, Que.—may have played into the hands of an energy industry keen to access offshore markets. “The oil companies have really positioned this almost as a thinly veiled threat in that if you don’t support the pipeline, it’s going to come through rail anyway,” says Steve Mossop, president of pollster Insights West. In the end, though, the pipeline-versus-rail debate may be moot in B.C., he says. “Whether it’s pipeline or transport by rail, I think the opposition will be equal.”