If you enjoy this blog, please share or leave a comment!
Opinion: Pipelines that carry dilbit, won't remain solvent. Oil trains that crash won't sell dilbit.
After recent Keystone XL decision by Barack Obama, oil groups are now parroting safety issues with respect to oil trains. They have a point. Oil trains are not that safe. What happened in Lac Megantic has happened elsewhere, since, luckily in uninhabited places.
The train industry was goated into safety upgrades for this type of train car. Since the industry is self-regulated, they basically rubber stamped their own solution. This was not a cheap plan. A new design was needed, testing, and then train cars modified. Industry spent $7,200,000,000 on safety upgrades. Mission accomplished?
These new cars are no safer, in fact, are more dangerous because some spontaneously started burning while stationary. The long anticipated new safe oil train car seemed to be late in arriving to the free market. So $7.2 billion in non-value added cash was spent. In the design world, that is considered a waste of money. When I was a designer, sending out an incorrect engineering drawing could cost millions. I was taught, by a very angry Croatian engineer, the “dirt foot” rule; "do it right the first time". Later I was taught 6 Sigma Quality. "Doing it right" pays for itself versus doing it twice and wasting the time to do it again.
When industry spends money for safety updates, shouldn't that money be spent on a working solution? Industry's back at square one. Poor management is always more expensive than well trained labour forces. Risky management risks future solvency! I guess investors can tolerate this risk? Should they? Do they have a choice?
So, I was asked this question: "pipelines or oil trains?". The designer in me said "neither". Until proven safe, both shouldn't be able to operate in Canada. I cannot imagine an oil train disaster in the Hamilton train corrodor. It would be like Lac Megantic, destroy so many lives, and leech toxic dilbit into Lake Ontario. With the recent infant mortality of new pipelines, it seems industry has a few safety issues to resolve. The cost of failure isn't an option.
Canada requires a Royal Commission on Safety. National regulators need to be audited for operational compliance. With sea level rise a risk, and Canada having the world's longest coastline, Government also needs to secure and plan for high-risk infrastructure and businesses, as well.
Canada needs confidence in new megaprojects. We need to ensure success and safety for citizens, our environment and investors. Can Ralph Goodale deliver?
The failed Carbon Capture and Storage facility, in Saskatchewan, is another example “dirt foot”. The failed technology might kill the operation before it can operate. Another poor “self-regulated” investment. Is it safe? I don't know.
Enjoy!