Oil mislabeled? Oil in Quebec train disaster mislabeled as less volatile variety.

Oil mislabeled: The train that exploded this summer in Lac-Megantic, Quebec, killing 47 people, carried explosive 'Group 2' oil mislabeled as a more stable 'Group 3' flammable liquid, officials say.

Adrian Wyld/The Canadian Press/AP
Transportation Safety Board Regional Senior Investigator Donald Ross points to a dangerous goods indicator on a rail car during a news conference in Ottawa, Wednesday, Sept. 11, 2013.

The oil carried by a freight train that derailed and exploded in Quebec this year had been misclassified as a less dangerous type of crude, Canadian officials said Wednesday, and they urged US and Canadian regulators to ensure dangerous goods are accurately labeled.

Forty-seven people were killed in the July disaster when the unattended train rolled away and derailed in the town of Lac-Megantic near the Maine border and several of its oil cars exploded. The downtown was destroyed.

The train's shipment of North Dakota oil was mislabeled as a "Group 3" flammable liquid, when it should have been given a more explosive "Group 2" classification, the Canadian transportation safety board's chief investigator, Donald Ross, said.

Asked if proper labeling would have changed what happened, Ross said the work of the board is not done.

Officials initially said they were surprised by the disaster because they thought the oil being transported was unlikely to ignite.

But Ross said the oil was as volatile as gasoline, and tests showed the oil was wrongly documented and should have been classed in the same category as gasoline.

Safety regulations for the transport of crude oil differ depending upon the type of oil and its flashpoint — the lowest temperature at which it will ignite.

The Transportation Safety Board of Canada issued safety advisory letters to the U.S. Pipeline and Hazardous Materials Safety Administration and to Transport Canada.

Responding to letters, U.S. railroad and hazardous materials safety officials said in a joint statement that they are still investigating whether crude oil shipments are being misclassified. The investigation includes spot inspections and sampling crude oil shipments to determine the ingredients and nature of the oil.

"Shippers and rail carriers found to be out of compliance with hazardous materials regulations could be fined or placed out of service," the statement from the Federal Railroad Administration and the Pipeline and Hazardous Materials Safety Administration said.

U.S. inspection teams have been conducting spot safety checks of rail shipments of crude from the booming Bakken oil region since the disaster. The Bakken region underlies portions of Montana and North Dakota in the U.S., and Saskatchewan and Manitoba in Canada.

The disaster raised questions about the increasing transport of oil by rail in the U.S. and Canada.

Much of that increase is from oil produced in the Bakken region. The train that crashed was carrying oil from North Dakota to a refinery in New Brunswick, Canada.

The train was operated by a U.S. company, the Montreal, Main and Atlantic Railway, but Ross said New Brunswick's Irving Oil co. is responsible for the labels because it imported the goods.

In the first half of this year, U.S. railroads moved 178,000 carloads of crude oil. That's double the number during the same period last year and 33 times more than during the same period in 2009. The Railway Association of Canada estimates that as many as 140,000 carloads of crude oil will be shipped on Canada's tracks this year, up from 500 carloads in 2009.

Deborah Hersman, acting chairman of the U.S. National Transportation Safety Board, said in a statement that they share the Canadian safety board's concern.

Canadian Transport Minister Lisa Raitt said she has directed Transport Canada officials to examine the board's safety advisory on an expedited basis.

"If a company does not properly classify its goods, they can be prosecuted under the Transportation of Dangerous Goods Act," Raitt said.

Cynthia Quarterman, head of the Pipeline and Hazardous Materials Safety Administration, has said her U.S. agency expects to publish draft regulations requiring that DOT-111 railcars be retrofitted to address safety concerns. The agency's proposal is intended to fix a dangerous design flaw in the rail cars, which are used to haul oil and other hazardous liquids throughout North America.

The car has come under scrutiny from safety experts because of its tendency to split open during derailments and other major accidents. Defects in the car's structure were noted as far back as 1991.

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