CN is undertaking test shipments of oil from Western Canada to U.S. markets in response to customer demand, but says it is not meant to compete against pipelines.
"It's meant as a complement to pipe," said CN spokesperson Kelli Svendsen.
Billed as a "Pipeline on Rail" program, CN has created a website to market its shipping ability.
On the website, CN says when oil sands producers need to transport crude oil products, they look for unprecedented connectivity, scalability, flexibility, reliability and speed - all with minimum impact on the environment.
"We offer a viable solution," says the company.
Pipeline on Rail, a name CN has protected with a trademark, is an economically sound, surprisingly fast way to ship crude oil products within Alberta, to the rest of Canada, the U.S. Midwest, the Gulf Coast, and other export markets, says the company.
But Svendsen downplayed the program, saying CN was only testing the idea.
Shipments have originated at Fort McMurray in the Alberta oilsands and also from the Bakken reserves in Saskatchewan, she said.
Fort McMurray is an industrial extraction centre for crude from the Alberta oilsands, which has reserves of 173 billion barrels. The Bakken region - which straddles the border between Saskatchewan and North Dakota and Montana - is an older-producing region that has been re-invigorated by new technology. Reserves in the Bakken region are estimated at 480 million barrels.
Although CN has had interest to rail crude oil to the west coast of British Columbia for export, the idea is only at the concept stage, Svendsen said.
No oil has been shipped to the coast, she stressed, noting the interest has come from customers.
There are proposed pipeline projects to take crude from the Alberta oil sands to the B.C. coast, including Enbridge's proposed $5.5-billion Northern Gateway pipeline. The 1,170-kilometre twin pipeline, which would pass just north of Prince George, would transport oil to Kitimat.
The project has just started a federal review expected to take two years.
Kinder Morgan also has a plan on its book to export oil to B.C.'s northwest coast, but it is nowhere near as advanced as Enbridge's plan.
Svendsen would not say how much oil is being shipped as part of the test runs from Fort McMurray and Saskatchewan, nor what capacity CN has to ship oil. CN's website, however, says the rail line has the capacity to move crude oil products on its network today.
The site extols that customers can start with as few as 1,000 barrels a day, and grow to as many as 200,000 barrels a day or more.
CN noted on the website it already moves diluent, pipe, aggregate, steel, cement, sulphur, and petroleum coke into and out of the oil-producing regions of western Canada.
