* Recovery efforts continue at Minnesota spill site
* Freezing temperatures turn oil into tar-like substance
* Debate rages over risk of transporting oil via rail
* Around 15,000 gallons of crude leaked, less than first thought
By Edward McAllister
March 28 (Reuters) - Recovery efforts were underway on Thursday to clean up an oil spill in western Minnesota, a day after a mile-long Canadian Pacific Railway train derailed, rupturing three tankers and leaking around 15,000 gallons of fuel.
The cleanup was expected to take another day or two, officials said, after 14 cars on a 94-car train heading for the Chicago area left the tracks on Wednesday about 150 miles northwest of Minneapolis near the town of Parkers Prairie.
The spill, which has triggered an investigation by federal officials, came as a debate rages over the environmental risks of transporting Alberta tar sands crude across the border from Canada.
This was the first major spill since a boom in North American oil production began to outgrow the existing pipeline network, prompting a huge rise in crude-by-rail transport three years ago.
The amount of oil estimated to have spilled into a nearby ditch and field was less than the 20,000 to 30,000 gallons originally estimated, Minnesota officials said, though freezing temperatures were hampering efforts to draw up the loose fuel.
"Only about 1,000 gallons has been recovered," said Dan Olson, spokesman for the Minnesota Pollution Control Agency. "The remaining oil on the ground has thickened into a heavy tar-like consistency."
The thickened crude is being moved into a lined trench and will be hauled away for disposal, Olson said.
Canadian Pacific was still unable to say whether the crude on board was from conventional oil fields or from the Alberta tar sands, where crude production is more carbon-intensive.
The train was delivering several different commodities, said Canadian Pacific spokesman Ed Greenberg, but all of the 14 cars that derailed contained crude oil.
Canadian Pacific will use steam to heat the derailed tanker cars so the oil they contain can be pumped out. This process is expected to take a few weeks, Olson said.
The company reopened the rail line in western Minnesota early on Thursday, following full track repairs and inspections. An investigation into the cause of the derailment is ongoing.
There has been a rapid increase in rail transport of crude in the last three years as new drilling technologies in North America have unlocked vast reserves of oil previously deemed too expensive to extract, although crude still represents a small fraction of U.S. rail transport.
U.S. trains carried 233,800 carloads of crude oil in 2012, more than double the 65,800 carloads transported in 2011 and dwarfing the 29,600 in 2010, according to figures from the Association of American Railroads.
Canadian Pacific's crude oil volumes have risen substantially over that period: from 2,800 carloads in 2010 to 53,500 carloads last year. The company expects that number to rise to 70,000 this year.
As crude by rail has increased in the United States, so have spill incidents. Of the 132 incidents that occurred while trains were in transit in the United States between 2002 and 2012, 112 occurred in the last three years, according to data from the Pipeline and Hazardous Materials Safety Administration.