Thousands of dead fish are washing up on the shores of the Cheakamus River after 41,000 litres of a toxic chemical spilled into the water when a CN train derailed Friday morning.

"I have seen every species that lives in the river dead. I just walked past a pile of more than 1,000 severely acid-burned fish," said Brian Klassen, a Squamish resident. "We are picking up a lot of dead fish along the river banks and it looks like they were actually trying to get out of the water."

Nine cars from a 144-car train plunged into the Cheakamus River -- 30 kilometres north of Squamish -- en route to Prince George about 7:30 a.m. Most were empty lumber cars but one was a tanker carrying caustic soda or sodium hydroxide, a corrosive material used for manufacturing at pulp mills.

The substance, commonly known as lye, spiked the river's pH levels.

Carl Halverson, property manager for the North Vancouver Outdoor School, was among the first on the scene.

"The river turned into a khaki colour and mature fish started to float past. Their gills were so badly damaged that they were unable to breath. It killed every species across the spectrum from coho, steelhead to lamprey eels," Halverson said.

"The devastation makes you sick to your stomach."

Halverson received a call from a CN contractor early Friday morning to shut all valves at the nearby fish hatchery. Initial estimates indicated the impact would be low but over the course of the day, Halverson said things got much worse.

"I don't know what compensation can be given if any because the fish are already dead. How do you quantify the damage?" Halverson said.

The Vancouver Coastal Health Authority issued a warning stating that no one should drink, swim, or eat any fish or wildlife near the river. People drawing their drinking water from wells within 100 metres of the river are also being advised to find other sources.

It is a warning many residents say came too late.

"Over 10 hours passed before the warning was released. People were bathing and drawing water out of the Cheakamus River all day long. They were not warned and that is a major issue," said Dave Harper, local resident.

On Saturday afternoon the pH levels returned to normal but Lance Sundquist of the B.C. Envrironment Ministry said recreation is still discouraged until final results are received.

Tourist outfitters are also being asked to cancel activities on the water until further notice.

Evan Phillips of Canadian Outback Adventures said the disaster could not have come at a worse time. August is peak season for many tourism operators.

Meanwhile, CN spokesman Graham Dallas confirmed 10,000 litres of the substance remains in the broken tanker.

He said crews are working around the clock to extract the caustic soda and remaining cars safely.

"In terms of the next step we are hoping to cool the chemical into a solid product, which could take a few days," Dallas said.

"We regret what happened but we are working with responders to get this resolved."

In Wabamun, Alta., CN agreed to pay so that residents can hire outside experts to assist them in their campaign to have the railway clean up a devastating oil spill from a train derailment on Wednesday. Property owners around Lake Wabamun, west of Edmonton, asked the company Saturday to foot the bill for experts to represent them because many of the area's summer residents must leave and can't attend daily briefings with those overseeing the cleanup.

The train derailed when 43 of 140 cars left the tracks. Some of the cars contained bunker fuel oil, used in liquid asphalt and to power barges and ships.

A CN official said Saturday that a faulty rail, which had not been inspected for three months, was the likely cause of the derailment.

© Times Colonist (Victoria) 2005