CP Buys Central Maine and Quebec Railway.

CP announced today that it purchased the Central Maine and Quebec Railway. What makes this buy so weird, is that the track once belonged to CP.

in 1994, CP sold off all its trackage east of Montreal. those assets were owned by Iron Road, which want bankrupt. the Montreal Maine and Atlantic was formed out of a portion of those assets, itself went bankrupt in 2014 after the Lac Megantic disaster.

Other assets in the area were sold to Irving, and operate as the NBSR. CP maintained rights over those lines until 1993.

since CP is re-acquiring the track, it will now have direct access to Saint John. this suggests they have business. Oil by Rail is certainly a possibility, however that has already been occurring form North Dakota. Alberta oil is to heavy to be processed by the saint john refinery, but that doesn’t mean there isn’t an opportunity to load crude tankers with Alberta oil on a second leg voyage. is that play big enough? good question.

what if MSC shipping were to pull out of Montreal – even Partially? MSC currently calls on Montreal and Saint John. Montreal is out of the way, and delays in recent years due to ice, and North Atlantic Right Whale speed reductions likely cause grief to the MSC Schedule. A suitable rail partner could get the containers inland just as fast, and save days of sailing.

Saint John terminal operator DP World is already listing connections to CP via the NBSR on its website, previously that connection was only possible via PanAm Railways, into New York state.

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