Raitt Says Canada Railways Must Pay More for Crude Spills

Canadian Transport Minister Lisa Raitt said the government will bolster the safety of shipping crude by rail by increasing the financial responsibility of railways for spills.

Canada is reviewing ways to strengthen its liability and compensation regime “so that sufficient resources are available to adequately compensate potential victims, pay for clean-up costs and protect taxpayers in the event of an incident,” Raitt said today, according to the prepared text of a speech to the Canadian Club in Ottawa. The government said in October it would require shippers and railways such as Canadian National (CNR) Railway Co. and Canadian Pacific (CP) Railway Ltd. to carry more insurance to pay the costs of disasters.

Prime Minister Stephen Harper’s government is boosting safeguards after a derailment in July in Lac-Megantic, Quebec that involved a train transporting crude. The crash killed 47 people and destroyed much of the town’s core.

The government is also looking at ways to improve the safety of DOT-111 tank cars, which are used to carry oil and other liquids, such as developing more sophisticated testing criteria for crude shipments, Raitt said today. Transportation inspectors in the U.S. and Canada said last month that crude hauled by rail needs to be shipped in safer tank cars.

To contact the reporter on this story: Andrew Mayeda in Ottawa at amayeda@bloomberg.net

To contact the editor responsible for this story: Paul Badertscher at pbadertscher@bloomberg.net

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