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Dozens of tanker cars similar to the model used for the train that crashed in Lac-Megantic, Que., are parked on Monday, July 16, on the train's line near Farnham, Que. (Les Perreaux/The Globe and Mail)
Dozens of tanker cars similar to the model used for the train that crashed in Lac-Megantic, Que., are parked on Monday, July 16, on the train's line near Farnham, Que. (Les Perreaux/The Globe and Mail)

Oil company disputes Lac-Mégantic cleanup order Add to ...

A Miami-based oil logistics company is objecting to a Quebec government order to assist with the cleanup of the train derailment and fiery crude-oil explosion in Lac-Mégantic, Que.

World Fuel Services Corp. said in a statement that the order issued Monday by Quebec’s Environment Ministry “is the first time the provincial government has taken the position that World Fuel Services has any responsibility for funding or supervising” the Lac-Mégantic cleanup.

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World Fuel, through its Minnesota-based subsidiary Western Petroleum, purchased the oil from producers in North Dakota’s Bakken region, then leased and loaded rail cars and arranged for their transport to an Irving Oil refinery in New Brunswick. The oil never made it to the final destination because a parked train operated by Montreal Maine & Atlantic Railway broke away and derailed on July 6, unleashing an explosive ball of burning oil on the small town.

The catastrophe killed 47 residents and levelled more than 40 buildings. Investigators are testing the chemical composition of the oil carried by the train to help explain why the derailment triggered such a large and unusual explosion.

In its statement, World Fuel said it did not expect to be named by the province or in any other government action because “MMA has assumed responsibility for the accident.” MMA’s chairman Edward Burkhardt told reporters after the catastrophe that its engineer failed to properly set emergency brakes when he parked the train on a hill near the town. Mr. Burkhardt said Tuesday the brake error is one of several factors involved in the tragedy and the final explanation won’t be known until Canada’s Transport Safety Board finishes its investigation.

World Fuel said its representatives have had “limited access” to the accident site because it is controlled by MMA and local authorities. Mr. Burkhardt disputed the account, saying his employees were only allowed brief access to the site on the day of the derailment, and it has since been tightly controlled by police and federal investigators. He confirmed that World Fuel’s staff visited the accident scene, but their “only interest was to inspect tank cars involved in the accident.”

In the early days of the accident, MMA hired contractors to clean up the burned-out centre of Lac Mégantic, which, according to investigators, is now laced with crude oil and other chemicals such as benzene. MMA has stopped paying the bills, which prompted Monday’s order from Quebec to pay for the cleanup. The town has sent two legal notices to MMA that it owes $7.7-million in unpaid cleanup fees. Mr. Burkhardt said the railway does not have sufficient cash to pay the bills and “we aren’t getting funds from our insurer to meet our obligations to the environmental mitigation contractors. If we were, there would be no issue with the municipality.”

He said discussions are continuing with the insurance company, Dublin-based XL Group PLC. “This is a complex matter, and discussions are continuing. I expect a resolution later this week.”

Follow us on Twitter: @justincgio, @jacquiemcnish

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