Norfolk Southern Corp.’s Chief Executive Officer Alan Shaw pledged that the company will ensure the safety of East Palestine, Ohio, after a Feb. 3 train derailment spilled chemicals in the middle of the small town.
(Bloomberg) — Norfolk Southern Corp.’s Chief Executive Officer Alan Shaw pledged that the company will ensure the safety of East Palestine, Ohio, after a Feb. 3 train derailment spilled chemicals in the middle of the small town.
“We are here and will stay here for as long as it takes to ensure your safety and to help East Palestine recover and thrive,” Shaw said in a letter. The statement came after a town hall Wednesday in East Palestine, which the company reportedly did not attend because of concerns about “the growing physical threat to our employees.”
Crews are cleaning up the site, and the railroad implemented a testing program for the water, air and soil, Shaw said. The company created a $1 million fund as a “down payment” to help rebuild the community of about 4,800.
Norfolk Southern could rack up tens of millions of dollars in costs from the derailment, according to one analyst’s estimate. The Environmental Protection Agency has urged the company to reimburse it for costs related to the crash as soon as possible, citing its “potential liability” in a Feb. 10 letter.
Norfolk Southern is likely to take a special charge in the first quarter to cover costs, Cowen Inc. analyst Jason Seidl wrote in a Tuesday report. Its shares are down 6.7% since the derailment. Rail operations resumed last week, although delays continue.
Residents have raised concerns about whether it’s safe to return home after the 150-car train derailed, caught fire and spilled chemicals, including vinyl chloride. There were 20 chemical cars on the train.
Three days after the accident, authorities intentionally vented and burned five tank cars containing vinyl chloride as pressure built up in a measure designed to keep them from exploding on their own and ejecting chemicals and metal shards in all directions. The dramatic cloud of black smoke and fire that resulted sparked even more concerns.
“I know there are still a lot of questions without answers. I know you’re tired. I know you’re worried,” said Shaw, who visited the disaster site last week. “We will not let you down.”
(Updates with potential liability in fourth paragraph)
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