Economy

Stephen Ewart, Calgary Herald
More from Stephen Ewart, Calgary Herald

Stephen Ewart is a Calgary Herald columnist
sewart@calgaryherald.com
twitter.com/stephen_ewart

Published on: April 23, 2015
Last Updated: April 23, 2015 6:47 AM MDT

After five years of rapid growth — punctuated by fiery crashes that stoked public safety fears across North America — the business of moving crude-by-rail is slowing down. ... It goes well beyond trains loaded with oil adhering to new lower speed limits.

A 20-fold surge in the volume of crude moving by rail across the continent has been an unintended consequence of the shale oil boom since 2010, but first quarter results released this week by Canada’s two largest railways suggest growth in the sector may be running out of gas. ... Similar to the oil industry overall, there is still upside forecast for oil-by-rail but it’s at a slower pace than forecast before a 50 per cent drop in the price of oil.

Canadian Pacific Railway revealed an eight per cent year-over-year drop in carloads of oil in its first quarter results this week. The Calgary-based railway hasn’t altered its forecast to ship 140,000 carloads of oil in 2015 but as recently as December it was predicting moving up to 200,000 carloads this year.

Canadian National Railway expects the number of carloads of oil and frack sand — a critical component in shale oil production — it will move in 2015 to rise by 40,000 carloads to 247,000. That’s less than half of what the Montreal-based railway had previously forecast. Industry analysts suggest oil will account for about 152,000 of the “energy-related” tankers shipped by CN.