Nearly two weeks after a train carrying carcinogenic chemicals derailed in East Palestine, Ohio, the extent of the damage to the nearby community is still unclear. Railroads face a traffic backlog and operator Norfolk Southern Corp. could rack up tens of millions of dollars in costs. 

Though residents have been allowed to return to their homes, many remain concerned about the long-term environmental effects of the February 3rd accident. Some of them watched from a distance as a fiery cloud blazed above the wreckage after Norfolk Southern, in conjunction with authorities, decided to intentionally vent and burn some of the railcars to avoid a potential explosion.

“I’ve had discussions with some people who live right near ground zero who are hesitant to come back,” said James Wise, a local attorney who filed a class-action lawsuit against Norfolk Southern on behalf of some residents. “There are people with young children and they don’t know what effects it’s going to have.”

Norfolk Southern is likely to take a special charge in the first quarter to cover costs of the accident, Cowen Inc. analyst Jason Seidl wrote in a February 14th report. The company’s shares are already down almost 7% since the derailment.

Carcinogen Spill

The 150-car Norfolk Southern train was hauling about 20 railcars containing chemicals including vinyl chloride, ethylhexyl acrylate and isobutylene, according to the U.S. Environmental Protection Agency. Vinyl chloride, which is used to make the plastic resin known as PVC, is a carcinogen linked to cancers of the liver, brain and lungs, according to the National Cancer Institute. 

It’s difficult to know exactly how much of the chemicals were burned off in the fire and how much might have leached into the ground and surrounding waterways. Surface water samples taken by Pace Analytical Services on February 4th detected contaminants from the derailment, the Ohio Environmental Protection Agency said.

The resulting spill killed 3,500 fish, according to the Ohio Department of Natural Resources. No livestock were affected, authorities said. Still, reports circulated on social media of dead chickens and pets. There were no immediate fatalities or injuries.

Since the fire was extinguished on February 8th, “air monitoring has not detected any levels of health concern in the community that are attributed to the train derailment,” said a statement from the regional EPA administrator on February 14th.

The U.S. EPA has urged Norfolk Southern to reimburse it for costs related to the crash as soon as possible, citing its “potential liability” in a February 10th letter. Chief Executive Officer Alan Shaw promised that the company would pay for a thorough cleanup, Ohio Governor Mike DeWine said Tuesday. A representative for Norfolk Southern confirmed the pledge. 

Tens of Millions

Railroads are the workhorse mode of transportation for hazardous materials moving around the U.S., and in 2021 they carried 992 million tons of such products, according to the American Chemistry Council. Under U.S. law, rail carriers must transport chemicals even if the potential risk of doing so outweighs the reward. 

While train derailments happen fairly regularly, those involving hazardous materials are less common. Of the more than 12,000 derailments logged by the Bureau of Transportation Statistics over the past decade, only 224 were carrying hazmat, according to analysts at JPMorgan Chase & Co.

In 2005, Norfolk Southern had a 16-car derailment in Graniteville, South Carolina, that included a tanker car with chlorine. That accident killed 10 people and took years to clean up, Cowen’s Seidl said. The railroad incurred about $35 million of expenses related to that incident. 

Another accident involving vinyl chloride occurred in 2012 when a Conrail train derailed in Paulsboro, NJ. That accident resulted in about $30 million of damages, Ariel Rosa, an analyst with Credit Suisse Group AG, said in February 13th report. 

“Our review of the history of such non-fatal incidents suggests that damages typically range from several million dollars to several tens of millions,” Rosa said.  

Wise, the local attorney, said at this point there are more questions than answers. He was forced to evacuate his office, and kept it closed after his assistant returned on February 9th to find a lingering odor. “What are the lasting effects? Is our water going to be affected? Is our health going to be affected?”

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