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Train collision forces N. Dakota town evacuation

Tuesday, 31 Dec 2013 | 12:28 AM ET
Oil train derailment in Casselton, ND
Monday, 30 Dec 2013 | 5:50 PM ET
CNBC's Seema Mody reports that as many as a dozen railcars derailed and that smoke from the fire could be seen up to 20 miles away.

Residents of a small town in North Dakota were urged to evacuate after a BNSF train carrying crude oil collided with another train on Monday, setting off a series of explosions and fires, the latest in a string of incidents that have raised alarms over growing oil-by-rail traffic.

Local residents heard five powerful explosions just a mile outside of the small town of Casselton after a westbound 112-car train carrying soybeans derailed. An eastbound 106-car train hauling crude oil ran into it just after 2 p.m. CST (2000 GMT), local officials said. There were no injuries in the collision that left 21 rail cars on fire, according to BNSF.

Residents within 5 miles (8 km) of Casselton were urged to evacuate to avoid contact with the smoke. Residents within 10 miles were asked to remain indoors.

(Read more: US oil skids under $100, battered by Libya woes)

Casselton resident Jolie Fiedler and her husband gathered their two dogs and left their home.

"It's better safe than sorry - just get out of town and dodge the smoke, I guess," she said. "I'm hoping that I can go home tomorrow, but who knows."

Casselton City Auditor Sheila Klevgard said crews are pushing snow to contain the oil before it reaches a nearby creek.

A train is derailed west of Casselton, North Dakota
Source: Tyler Spriggs
A train is derailed west of Casselton, North Dakota

Half of the oil cars have been separated from the train, but another 56 cars remain in danger, said Cecily Fong, the public information officer with the North Dakota Department of Emergency Services. The collision destroyed both engines on the oil train. Both trains were operated by BNSF Railway Co, which is owned by Warren Buffett's Berkshire Hathaway.

The incident will likely stoke concerns about the safety of shipping increasing volumes of crude oil by rail, a trend that emerged from the unexpected burst of shale oil production out of North Dakota's Bakken fields.

Over two-thirds of the state's oil production is currently shipped by rail.

Initial reports from the scene of the accident did not point to a malfunction on the oil-carrying train. Still, videos of the exploding rail cars are likely to add to the ongoing debate on what fixes are needed as older train cars carry flammable fuels such as oil.

The derailment occurred about a mile west of Casselton, a town of about 2,300 just west of Fargo, between an ethanol plant and the Casselton Reservoir, Fong said.

Casselton is state Governor Jack Dalrymple's hometown.

Rail Crossroads

North Dakota is home to a raging shale oil boom that produced nearly 950,000 barrels of oil a day in October. It is also a major grain producer and long accustomed to a high volume of rail traffic.

But shipments of oil have surged lately, most of it the light, sweet Bakken variety that experts say is particularly flammable.

Trains carried nearly 700,000 barrels a day of North Dakota oil to market in October, a 67 percent jump from a year earlier, according to the state Pipeline Authority.

This summer, a runaway oil train carrying Bakken crude derailed and exploded in the center of the Quebec town of Lac-Megantic, killing 47 people. The incident fueled a drive for tougher standards for such shipments, including potentially costly retrofits to improve the safety of tank cars that regulators have cited as prone to puncture.

In early November, two dozen cars on another 90-car oil train derailed in rural Alabama, erupting into flames that took several days to fully extinguish.

The Association of American Railroads recently proposed costly fixes to older tank cars that do not meet its latest standards but continue to carry hazardous fuels such as oil.

The fixes include protective steel jackets, thermal protection and pressure relief valves, which could cost billions of dollars. Oil shippers, likely to be saddled with the costs of retrofits, oppose some of the changes proposed by the association.

Following the Canadian rail disaster, the U.S. Department of Transportation began an operation it dubbed "Bakken Blitz," which includes spot inspection of oil shipments aboard trains in North Dakota.

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