David Black convinced of oil-by-rail safety for Kitimat refinery project

The proponent for an oil refinery near Kitimat says rail is a viable alternative to using pipelines to supply the facility.

The proponent of the Kitimat Clean oil refinery David Black says he’s coming around on the idea of supplying his proposed refinery by rail.

Black, who is also Chairman of Black Press which owns this newspaper, said he’s been persuaded on the safety of oil by rail for two main reasons: the consistency of oil in a rail car is far different, and safer, than in a pipeline, and it reduces costs associated with providing a diluent.

Bitumen oil, he said, is a fairly solid substance that requires diluent material to pump it in a pipeline.

In a rail car it just has to be heated to be poured in and then re-heated at the other end to enter the refinery.

For the journey the material is so solid that he said in the case of any derailment of the train there’s a good chance the bitumen might not even leak out of the rail car.

“As it cools a few degrees it sets like wax,” he said. “That’s what you’re shipping. If there’s a derailment it’s not going to run out of the car.”

Oil by rail was not always in his plans though.

“I lived in Williams Lake for 10 years beside the rail line and I knew how many derailments there were continually. It’s just an ongoing fact of life in the rail business,” he said. “So I thought this could be a disaster.”

But he said consultations have changed his mind.

He said the bitumen has to be heated to 60C to be poured in to rail cars.

When it arrives at the refinery steam coils built in to the cars are connected to live steam to loosen it again allowing it to be poured out.

“It could go by pipe too, but rail, in many ways, is simpler.”

He told a gathering at a Rotary Club meeting in Surrey last week that he expects six trains a day would run every four hours.

As for the overall game plan for the refinery, he says he had some questions regarding the site to work out before he could submit his environmental description with the government, but said that description, the first step in an environmental review, would go in before Christmas.

It’s a two year process to get permits, and he said he’ll be seeking financing during that time too.

“While we’re doing that I have to raise $100-$200 million to do all the rest of the preliminary engineering. I’ve done the first part, but the second part is more money than I have in my bank account.”

Once financing and the review is done he said it will take up to six years to construct the facility.

At those estimates the refinery could potentially be running by 2023.

Black also told the Surrey Rotary Club that the federal Liberal government’s move to formally ban crude oil tankers from B.C.’s north coast means the Northern Gateway pipeline plan is “pretty much dead” but that shouldn’t block tanker exports of refined fuel, which would be less damaging than a spill of crude or bitumen at sea.

– Files from Jeff Nagel