Canadian Crude Oil Is Going By Rail To Portland Before Shipping Off To Asia

Mar 16, 2018
Originally published on March 16, 2018 7:22 pm

Canadian oil has found a new route to Asia: It’s moving by rail through Washington to a shipping terminal in Portland.

In the long run, Canada wants to expand its Trans Mountain pipeline to move oil from the Alberta tar sands west to British Columbia — and from there onto ships that would travel through the Salish Sea and then onto Asia.

But that expansion has yet to begin. And oil producers have instead begun shipping that oil by rail to Portland and loading it onto vessels for export.

Portland exported more than 240,000 barrels of oil to China in January, according to a report by Bloomberg.

But it's far from clear that oil producers see oil-by-rail and the Willamette and Columbia rivers as part of their long-term strategy.

“My read on all this is it can’t be a large new route to get oil to Asia. What this looks like is a test shipment,” said Clark Williams-Derry, who studies energy markets for the Sightline Institute, a Seattle-based think tank.

Williams-Derry said shipping oil overseas through Portland is not economical. It’s likely an attempt to establish a new market.

State regulators say the oil is moving through the Zenith Energy terminal on the Willamette River. The facility was an asphalt plant until four years ago when it was purchased by Arc Logistics and quietly began accepting shipments of crude oil by rail. It was acquired by Zenith in December.

It is the only facility in Portland accepting those Canadian crude shipments and transloading them, Oregon Department of Transportation spokeswoman Shelley Snow said. She said the agency’s hazardous materials inspectors are aware of the shipments and regularly inspect the area.

Train shipments of Canadian oil have been moving through the Northwest since as early as 2015, but the use of those shipments to facilitate exports to China appears to be a new development. Overall, oil train shipments have dipped after reaching unprecedented levels between 2013 and 2015.

A 2016 fiery derailment, crash and spill involving an oil train in the Columbia Gorge town of Mosier, Oregon, generated headlines and raised public awareness about the risks of what critics have dubbed "train bombs" and "rolling pipelines."

Plans for the Trans Mountain crude oil pipeline through British Columbia have been met with fierce opposition from tribes and environmentalists, including some from Washington.

Related: Crossing The Border To Protest A Canadian Pipeline

The pipeline was a topic of conversation Friday during a gathering of leaders of British Columbia, Washington, Oregon and California to discuss regional cooperation around climate change and other issues.

Washington Gov. Jay Inslee used the forum to express his support for British Columbia's resistance to the expanded pipeline.

"The oil pollution risk would increase significantly," Inslee said. "And we have serious questions whether it really makes sense to be making such massive investments in fossil fuel infrastructure given the fact that we know we’re going to have to wean ourselves off of fossil fuel-based fuels in the decades to come."

KUOW/EarthFix reporter Eilís O'Neill contributed to this report.

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