Wed 31 Jul 2013 07:14

WFS questions legality of payment order


World Fuel Services says it has 'serious objections' to being ordered to pay for crash cleanup operation.



Marine, aviation and land fuel specialist World Fuel Services Corporation has said that it has "serious objections" to being ordered by the government of Quebec to help pay for the cleanup of the train derailment in Lac-Mégantic, Quebec, earlier this month, Reuters reports.

Quebec Environment Minister Yves-François Blanchet invoked powers under a provincial law on Monday to force the rail and fuel companies involved in the devastating train crash to take financial responsibility for the damage caused by the incident, which killed 47 people and destroyed the centre of the small town of Lac-Mégantic.

"World Fuel Services will continue to meet any and all obligations it may have with respect to the accident; however, we have serious objections to the legality of the order," the fuel company said in a statement.

"We intend to promptly discuss these issues with the relevant authorities."

The tanker train had been parked at Nantes station for the night when it broke loose and sped away without a driver on Saturday, July 6. The subsequent derailment and explosion sent a fireball and black smoke into the air, forcing the evacuation of around 1,000 people, and dozens of buildings were destroyed.

In the days after the incident, World Fuel Services confirmed that crude oil sold by one of its subsidiaries was being carried by railcars involved in the deadly train derailment and that the product was destined for Irving Oil in Saint John, New Brunswick.

In response to Monday's move by the Quebec government to force World Fuel Services to pay for the cleanup, the company said it was surprised by the government action as it was the first time the government had said World Fuel Services bore any responsibility.

Cleanup crews have begun to recover an estimated 5.7 million litres of oil from the nearby lake, river and ground. Minister Blanchet promised on Monday that taxpayers would not have to pay for it.

Last week, Lac-Mégantic Mayor Colette Roy-Laroche said that Montreal, Maine & Atlantic Railway (MMA) - the train operator involved in the derailment - had stopped paying for the cleanup operation, forcing the town to pick up the tab.

As a result, the town sent a lawyer’s letter to MMA, giving the firm 48 hours to repay Lac-Mégantic for the cost of retaining the three firms initially hired by MMA.

On Tuesday, July 30, Roy-Laroche said in a press conference that MMA had not still not paid the companies it hired to help clean up after the disaster. She said that the town has so far paid approximately C$7.8 million ($7.57 million) for the work and has given notice to MMA for a second time that it needs to be reimbursed.

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