An evacuation order continued late Friday for hundreds of residents forced from their homes after a massive Canadian Pacific freight train hauling chemicals derailed in Oshawa, Ont.

The derailment, which occurred Friday afternoon, prompted the evacuation of locals living within a one-kilometre radius of the crash scene. Area schools were also evacuated.

"Residents are being told to remain away from their homes until further notice," Durham Regional Police Sgt. Nancy van Rooy told CTV.ca in an email Friday night.

Earlier in the evening, there were conflicting reports about whether some residents had been cleared to return home.

But van Rooy said that only residents of one small street, Greenwood Ave., had received permission to go home as of Friday night.

Police say the train derailed near the Canadian Pacific rail yard in southern Oshawa at about 2:15 p.m.

"Upwards of 20 cars or more have been derailed," van Rooy said.

"A number of them are tanker cars carrying chemicals, but I've not been made aware of any hazards."

Canadian Pacific later confirmed that 27 of the train's 111 cars derailed.

Hydrogen peroxide and caustic soda were among the chemicals on board the train, though police do not consider them to be hazardous to residents.

There were no reported injuries on Friday.

CP spokesman Mike LoVecchio said the clean-up effort had yet to begin Friday night because of safety precautions.

LoVecchio added that the safety of CP employees and the people in the surrounding area were the immediate priority at the scene.

"Once we complete our assessment, we will then be developing a plan to recover the product in the rail cars, and that's when the clean-up will start," he told CTV.ca.

"But I can't estimate when that will be."

One of the train's tankers burst into flames following the derailment, but was doused by emergency crews who arrived at the scene. Residents say the smoke could be seen from the nearby Highway 401.

Chopper footage of the derailment site showed some of the off-track train cars encroaching on the backyards of Oshawa residents. Other train cars were crunched underneath a nearby overpass.

At least two of the cars were in the backyard of a home that backs onto to rail corridor where the derailment occurred -- and it was clear that there were at least a few close calls.

John Bould, a resident whose house backs onto the part of the tracks where the train derailed, said the derailment was sudden and scary.

"I started running and I thought I was going to die," Bould told CTV Toronto on Friday.

His next-door-neighbour told CTV Toronto that his seven-year-old son often plays near the part of the fence that was torn down by a tripped-up train car.

Eighteen-year-old Tara St. Jean, who lives across the street from the derailment site, was in her bedroom when the train went off the tracks.

She said the incident has left her feeling shaken.

"(I was) scared about having to leave, where to go, if it was going to blow up and I would have nothing," she said Friday.

CTV Toronto's Paul Bliss reported that firefighters were applying foam to the underside of the locomotives to prevent a diesel spill -- which could cause a fire -- on Friday afternoon.

The derailment did not affect commuter rail service, nor did it impact traffic on the 401.

William Brehl, national president of the Teamsters Canada Rail Conference, told ctvtoronto.ca that it is too soon to tell what may have caused the derailment.

But Brehl said more than 80 per cent of derailments are caused by track or equipment failures.

"I would say the odds are that it's track or equipment failure, but you can't say for sure until the investigation is complete."

Brehl said it was likely that either two or three CP employees had been on board the train at the time of the derailment - an engineer, a conductor and possibly a trainman.

Federal transportation investigators are expected to arrive at the derailment site early Friday evening.

With reports from CTV Toronto reporters Paul Bliss, Jim Junkin and Reshmi Nair and files from The Canadian Press