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National Transporation and Safety Board (NTSB) member Robert Sumwalt (R) views damaged rail cars at the scene of the BNSF train accident in Casselton, North Dakota January 1, 2014 in this handout provided by NTSB.NTSB/Reuters

An explosive collision in the U.S. Midwest is sharpening concerns about the safety of shipping oil by rail, with the mayor of the nearby North Dakota town going so far as to say that crude from the region should instead be transported by pipeline.

While no one was hurt in Monday's dramatic derailment, which resulted in the evacuation of hundreds of people in a largely rural area, the mayor of Casselton, N.D., said it demands a strong response from regulators and industry.

"Maybe it is just too dang dangerous to transport above ground," Ed McConnell said of the oil from the Bakken region. "Maybe it should be stuffed into a pipe."

In an interview with The Globe and Mail, Mr. McConnell said the explosion – which is reminiscent of the explosion at Lac-Mégantic, Que., that killed 47 people – hits close to home for Dakota's booming oil patch and has left the region troubled and shaken.

July's tragedy in Quebec was likely "too distant" to resonate deeply among many Americans, Mr. McConnell said. But as the mayor of a small town of 2,500 along a busy rail corridor, he said he was devastated by Lac-Mégantic – and he had been dreading the prospect of a similar accident in Casselton.

"I didn't think I would have to deal with it quite this soon," he said. If the explosion happened moments earlier than it did, as the oil train passed through Casselton, dozens of people could have been killed. "A low estimate would be 100," Mr. McConnell said.

A Globe and Mail investigation has identified a troubling lack of oversight in the industry and has found that the oil being shipped from North Dakota's Bakken region is more volatile than many regulators and railways believed. In response to The Globe investigation, Ottawa has pledged to designate crude oil a highly dangerous substance, which will trigger new rules for its transport across the country.

Monday's explosion occurred in a North Dakota wheat field after a train hauling soybeans derailed into the path of the oil train that had just passed through the town. In the aftermath, many people in the town were evacuated to nearby Fargo for a night, for fear of their breathing toxic fumes.

BNSF, the railway that was hauling the oil – and owned by billionaire business tycoon Warren Buffett – has issued a statement saying it is "terribly sorry for the inconvenience."

The company is now referring questions to U.S. government investigators, who say their probe may take more than a year to complete.

U.S. National Transportation Safety Board officials say the oil was being hauled by old-model "DOT-111" cars, a type of container car that is being gradually phased out after safety and durability concerns. These cars were the same type that exploded in Lac-Mégantic.

"Thank God no one got killed," said Olivia Chow, the New Democratic Party's transportation critic. The parallels with the Quebec tragedy are clear, she said. "It's the same kind of oil, same kind of train."

The NDP MP argues that governments on both sides of the border ought to force the railway industry to upgrade such container cars urgently – given how they pass through many towns and cities, including her own riding in Trinity-Spadina.

"There needs to be a plan," Ms. Chow said.

Over the past decade, the upstart Bakken oil industry – named for a geological formation that extends to Manitoba and Saskatchewan – has propelled North Dakota into becoming the No. 2 U.S. oil-producing state after Texas.

Yet this kind of oil is not the "black, thick, goo" that most people envision, the mayor of Casselton said. "It's a lot more volatile, flammable. … I've heard people claim you could cut it 50 per cent with diesel fuel, and throw it in a truck and burn it."

In North Dakota, Mr. McConnell said, the oil is often viewed as the salvation of a state that grappled with a declining population and a struggling economy. But now he wants officials to better regulate the booming industry.

The North Dakota oil industry "has to convert from wildcatting, to being a responsible neighbour," he said.

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