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TransCanada ponders rail shipments if Keystone XL pipeline gets rejected

January 27, 2014

Vitaly Yamzin/Hemera/Thinkstock

While pipeline operator TransCanada is still waiting for President Obama's decision on the major Keystone XL pipeline project, the company is considering alternative ways to move crude from Alberta's oil sands to Oklahoma.

According to the company's chief executive officer, Russ Girling, if the Keystone project is rejected TransCanada will move on to build rail terminals in Alberta and Oklahoma and will start shipping by rail, the Associated Press reported. Girling admitted that rail is a less safe way to move crude but he stated that, if customers want the company to build rail terminals, it will. Pipelines are a much safer option for transporting crude, he noted.

RELATED: North Dakota train accident will not affect rail movements of crude, analysts say

A rail terminal would be located in Hardisty, Alberta, which is planned to be the starting point of the Keystone pipeline. Another terminal could be built in Cushing, Okla., where the northern leg of the pipeline is planned to end. The southern leg of the line, from Cushing to the Gulf Coast, is already completed and is scheduled to start operations next week.

Safety concerns have been raised over rail shipments of crude following a number of train derailments that led to explosions and devastating damage, the news service commented. In the most deadly incident recently, a train carrying crude oil derailed in Lac-Megantic, Quebec, in July 2013, killing 47 people and destroying more than 30 buildings in the town.

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