Second CP Rail spill in a week leaks four barrels of oil

(Reuters) - Canadian Pacific Railway Ltd suffered its second oil spill in a week on Wednesday, but said just four barrels of light crude leaked from tanker cars in a morning derailment in a remote area of northern Ontario.

CP, Canada's No. 2 railway, said 20 cars in a 128-car mixed-freight train destined for Montreal derailed near White River, about 700 kilometers (400 miles) northeast of Toronto. It said two tankers temporarily leaked crude following the incident.

CP said the oil has been contained and there were no injuries.

The spill comes a week after 14 cars on a 94-car CP train derailed near Parkers Prairie, Minnesota, spilling close to 15,000 gallons (360 barrels) of Canadian oil bound for U.S. refiners and raising questions about the safety of shipping crude by rail.

That was first major spill since a boom in North American oil production prompted a huge rise in crude-by-rail transport as oil output began to outgrow the existing pipeline network.

The railway and Canada's Transportation Safety Board are investigating the cause of the White River derailment. The company could not yet say when the line will reopen.

CP shares were down C$3.11 at C$123.23 late on Wednesday afternoon on the Toronto Stock Exchange.

The White River area is best known as the birthplace of Winnie, the London Zoo bear that inspired the A.A. Milne's children's classic Winnie the Pooh.

($1=$1.01 Canadian)

(Reporting by Allison Martell and Scott Haggett; Editing by Janet Guttsman, Sofina Mirza-Reid and Peter Galloway)

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Canadian Pacific oil spill cleanup to last two days

By Edward McAllister

(Reuters) - Recovery efforts were underway on Thursday to clean up an oil spill in western Minnesota, a day after a mile-long Canadian Pacific Railway train derailed, rupturing three tankers and leaking around 15,000 gallons of fuel.

The cleanup was expected to take another day or two, officials said, after 14 cars on a 94-car train heading for the Chicago area left the tracks on Wednesday about 150 miles northwest of Minneapolis near the town of Parkers Prairie.

The spill, which has triggered an investigation by federal officials, came as a debate rages over the environmental risks of transporting Alberta tar sands crude across the border from Canada.

This was the first major spill since a boom in North American oil production began to outgrow the existing pipeline network, prompting a huge rise in crude-by-rail transport three years ago.

The amount of oil estimated to have spilled into a nearby ditch and field was less than the 20,000 to 30,000 gallons originally estimated, Minnesota officials said, though freezing temperatures were hampering efforts to draw up the loose fuel.

"Only about 1,000 gallons has been recovered," said Dan Olson, spokesman for the Minnesota Pollution Control Agency. "The remaining oil on the ground has thickened into a heavy tar-like consistency."

The thickened crude is being moved into a lined trench and will be hauled away for disposal, Olson said.

Canadian Pacific was still unable to say whether the crude on board was from conventional oil fields or from the Alberta tar sands, where crude production is more carbon-intensive.

The train was delivering several different commodities, said Canadian Pacific spokesman Ed Greenberg, but all of the 14 cars that derailed contained crude oil.

Canadian Pacific will use steam to heat the derailed tanker cars so the oil they contain can be pumped out. This process is expected to take a few weeks, Olson said.

The company reopened the rail line in western Minnesota early on Thursday, following full track repairs and inspections. An investigation into the cause of the derailment is ongoing.

There has been a rapid increase in rail transport of crude in the last three years as new drilling technologies in North America have unlocked vast reserves of oil previously deemed too expensive to extract, although crude still represents a small fraction of U.S. rail transport.

U.S. trains carried 233,800 carloads of crude oil in 2012, more than double the 65,800 carloads transported in 2011 and dwarfing the 29,600 in 2010, according to figures from the Association of American Railroads.

Canadian Pacific's crude oil volumes have risen substantially over that period: from 2,800 carloads in 2010 to 53,500 carloads last year. The company expects that number to rise to 70,000 this year.

As crude by rail has increased in the United States, so have spill incidents. Of the 132 incidents that occurred while trains were in transit in the United States between 2002 and 2012, 112 occurred in the last three years, according to data from the Pipeline and Hazardous Materials Safety Administration.

(Additional reporting by Scott Haggett in Calgary and David Sheppard in New York; Editing by Gerald E. McCormick,; Peter Galloway and Bernard Orr)

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Canadian Pacific oil spill cleanup to last two days

By David Sheppard and Jeffrey Jones

NEW YORK/CALGARY (Reuters) - A mile-long train hauling oil from Canada derailed, spilling 30,000 gallons of crude in western Minnesota on Wednesday, as debate rages over the environmental risks of transporting tar sands across the border.

The major spill, the first since the start of a boom in North American crude-by-rail transport three years ago, came when 14 cars on a 94-car Canadian Pacific train left the tracks about 150 miles northwest of Minneapolis near the town of Parkers Prairie, the Otter Tail Sheriff's Department said.

Canadian Pacific Railway Ltd, the country's second-largest railroad, said only one 26,000-gallon tank car had ruptured, adding it was a mixed freight train.

CP spokesman Ed Greenberg said he did not know if the crude was from Canada's tar sands or from conventional oil fields.

Minnesota Pollution Control Agency spokesman Dan Olson said up to three tank cars were ruptured and an estimated 20,000 to 30,000 gallons - or 475 to 715 barrels - leaked out.

Cold weather had made the crude thicker, hindering the ability to recover the oil, Olson said, adding the initial cleanup was expected to continue for a day or two.

"We are focusing on drawing up the loose (oil) ... and once that has been taken up, they will then pump up the remaining oil in the tanks," Olson said. "Because of the winter conditions, the ground is frozen and there is not any damage to surface water or ground water. After the initial recovery we will see if the oil has soaked into the soil at all."

In an updated statement, CP said just one car was compromised and other two cars leaked while being moved during the response to the derailment and were contained.

Greenburg said that the Safe clean-up efforts were progressing well and without concern.

"There have been reports that clean-up has been challenging. Our crews are taking appropriate steps in ensuring clean-up is conducted appropriately."

A photo provided by the Minnesota Pollution Control Agency showed several large tank cars lying at the side of the railroad tracks in snow-covered fields, as clean-up crews examined the spill and maneuvered pump trucks into position.

"We have options to reroute traffic, so we've been able to continue to move trains while we do the thorough job of cleaning up the area," said Canadian Pacific's Greenberg.

A spokesman for the Federal Railroad Administration said two representatives of the U.S. rail regulator are investigating the incident.

CRUDE-BY-RAIL

There has been a rapid increase in rail transport of crude in the last three years as booming North American oil production has outgrown existing pipeline capacity.

Canada is the top exporter of crude to the United States, due to rising output of crude from its vast tar sands deposits.

Around 40,000 barrels per day (bpd) on average were shipped to the United States in 2012, according to data from Canada's National Energy Board.

Suncor Energy Inc SU.TO, Canada's largest oil company, pulled the plug on its long-delayed and partially built Voyageur oil sands upgrading project in northern Alberta on Wednesday, citing surging volumes of crude from the Bakken.

Environmentalists have complained about the impact of developing the reserves, and have sought to block TransCanada Corp's controversial Keystone XL project, which would carry oil produced from the oil sands to the U.S. Gulf Coast refining center.

Some experts have argued oil-by-rail carries a higher risk of accidents and spills.

"It is good business for the rails and bad safety for the public," said Jim Hall, a transportation consultant and former chairman of the National Transportation Safety Board.

"Railroads travel through population centers. The safest form of transport for this type of product is a pipeline. This accident could - and ought to - raise the issue for discussion."

Others noted that spills from rail cars are rare, and crude-by-rail has opened up opportunities for companies to develop huge volumes of oil production in places like the Bakken shale fields in North Dakota, which are not well served by pipelines.

Total shipments of petroleum on U.S. railroads rose more than 46 percent last year to 540,000 carloads, the Association of American Railroads said in January.

"It's not very good publicity, but railroads are incredibly safe, they don't spill often," said Tony Hatch, independent transportation analyst with ABH Consulting in New York who has done work for major railroads. "It should not change the opportunity railroads have to make us more energy independent."

Supporters of the Keystone XL pipeline were quick to jump on the derailment as a reason to build the pipeline.

"It should be clear that we need to move more oil by pipeline rather than by rail or truck," said Don Canton, spokesman for North Dakota Senator John Hoeven, who has been one of the chief political proponents of the line. "This is why we need the Keystone XL. Pipelines are both safe and efficient."

Hoeven has supported the line as it would help carry oil produced in North Dakota to higher priced refining centers on the coast, and could help further expand production in the state that now pumps more oil than Alaska.

(Reporting By David Sheppard, Edward McAllister, Cezary Podkul, Matthew Robinson, Eileen Houlihan, Jeanine Prezioso in New York, Jeff Jones in Calgary and NR Sethuraman in Bangalore; Editing by Gerald E. McCormick, Leslie Gevirtz, G Crosse and Michael Perry)

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Canada's Suncor says "negligible" impact from waste water spill

(Reuters) - The spillage of industrial waste water at Suncor Energy Inc's main oil sands project had a limited impact on the local river, Canada's No. 1 oil producer said.

Waste water from Suncor's oil sands operation north of Fort McMurray, Alberta, escaped on Monday morning when a pipe broke after freezing.

The Athabasca River is the main source of drinking water for aboriginal and other communities downstream and has been the subject of several controversial reports on its water quality.

"Based on modeling, preliminary volume calculations and the current flow rate of the river, the process affected water may have had a short term, negligible impact on the river," company spokeswoman Sneh Seetal said in an emailed statement on Wednesday.

An estimated 350 cubic meters of contaminated water was released into the river over a 10-hour period, the company said, adding that it did not contain tar-like bitumen.

Oil sands firms store contaminated water, a byproduct of stripping bitumen from the sands, in holding ponds.

Those ponds became the focus of environmental protests in 2008, when 1,600 ducks died after landing on a tailings pond operated by Syncrude Canada Ltd.

While new regulations introduced after the mass duck deaths aim to eliminate the toxic ponds, they remain controversial because of the risk of spills into the Athabasca River.

"This process affected water was mixed with treated water, prior to entering the river," Suncor said. "The ratio was approximately six parts treated water to one part process-affected water."

(Reporting by Ratul Ray Chaudhuri in Bangalore; Editing by Joseph Radford)

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Venezuela's political divisions spill into streets

CARACAS, Venezuela (AP) — Under a three-story-tall banner blaring "You are all Chavez," Jose Rafael Hernandez crouched low with a can of spray paint, outlining on a wall a black heart and the words "And long live Chavez..."

He and his three-man crew had already sprayed some 20 murals over the past week all over the "23 de enero" slum where support for the late President Hugo Chavez, their "Comandante," remains rock solid even after his death Tuesday. Dozens of other graffiti crews have also been at work, showing their allegiance in slogans and murals on countless doorways and walls.

"This is how we keep Chavez alive," said Jorge Luis Gonzales, a state bank accountant overseeing Hernandez's graffiti crew. "This is going to continue because the elections are coming, and the Comandante needs a big surprise. The opposition has their own graffitists, and we have ours."

Nearly a week after Chavez's death, Venezuelans have shown no signs they're ready to lower the rhetorical temperature. In fact, the national obsession with politics has only intensified as Venezuelans gear up for April 14 elections pitting Chavez successor Nicolas Maduro against opposition candidate Gov. Henrique Capriles.

All over this gritty capital built amid rolling hills, evidence of more than a decade of political warfare over Chavez and his socialist legacy is everywhere, from murals and billboards to even the T-shirts and caps worn by people in the city's chaotic streets.

In the eastern half of Caracas, which has long been known as an opposition stronghold, neighborhoods exploded in fireworks and car-honking Sunday night when Capriles launched his candidacy by accusing Maduro of using Chavez's death for political gain.

On the back of a barbecue shack in the neighborhood of Marquez, a mural with orange-and-yellow flames pleaded "Something Different!" while Capriles' youthful face looked out of graffiti stenciled here and there on surrounding blocks. Chavez images were conspicuously absent.

"I'm thinking that we'll have continuity for three years, more or less, and then real democracy will come," predicted Jose Garnica, a business owner reading the newspaper in a park bench.

He said the government had seized an apartment building he owned in the city center to house poor families and had only offered to pay him a pittance for it. He is still fighting to receive full compensation.

"This population is split 50-50," Garnica said, "and the government has fooled much of the poor here. What we need now is a change of government, not a socialist government but a democratic one."

For Jose Escobar, the plan for the future should be exactly more Chavez. Dressed in the late president's trademark red, he was drinking beers with fellow true believers in a plaza covered with graffiti images of the late president, despite a ban on public alcohol consumption during seven days of mourning.

"We will live and we will fight!" Escobar pledged, echoing a phrase used often by Chavez during his battle with cancer. "All the social programs must continue."

To be sure, the government has worked hard to keep the political fever high, as it rallies behind Maduro's candidacy.

Graffiti artist Reynaldo Rodriguez, who was helping Gonzales, said they had received paint and other materials directly from an army colonel to paint pro-Chavez slogans all over the slum, a violation of a constitutional ban on the military from engaging in politics. Banners pledging loyalty to Chavez hang from dozens of public housing towers and government buildings, while the displaying of Chavez's embalmed body in the army's military academy has turned into a running celebration filled with folk bands and thousands of weeping adherents.

"The government has been very clear and up-front that the media strategy is extremely important," said David Smilde, a senior fellow and Venezuela expert with the think tank the Washington Office on Latin America. "The exposure on Chavez has been very dramatic, trying to keep that sense of him being omnipresent."

Yet not everybody was pledging eternal battle.

Venezuela's bright yellow, red and blue flag has been flying at half-mast all over the capital, from improvised flagpoles set up on bare-brick huts in pro-Chavez slums, as well as on the manicured lawns of middle-class apartment towers in opposition-dominated neighborhoods.

Some Venezuelans said they were exhausted from all the attacks and counter-attacks, while others who had spent years criticizing Chavez said they mourned the man.

In a small, dimly lit salon in the working-class neighborhood of San Juan, Chavez backers Elle Coba and Darly Gomez laughed with unemployed teacher Joanna Machado even though she minced no words about her distaste for Chavez.

Coba lauded the food programs, schools and free public housing Chavez had launched across the country. She was wearing an armband and several hair scrunchies emblazoned with the flag's colors in honor of her Comandante.

Gomez joined in the praise, though she opted for orange-and-black spandex.

"All governments have their mistakes, but Chavez has tried to make our lives better," she said. "He's contributed and done things our nation has never done before."

Then, Machado had her say.

"I am not a supporter of their policies, which they've used many times to keep themselves in power," Machado said. "They haven't done anything about jobs, which is what everyone needs. We have so many problems that need to be solved."

Coba hugged both women.

"I wish there were no fights, and everyone respected the ideology of everyone else," she said. "Poor, rich, we are all together in this."

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