CMQ for sale?

It is my understanding that currently NBSR essentially operates as a terminal railroad providing delivery services for a fixed fee to CMQ and Pan Am in Saint John. If so, eliminating CMQ and CP delivering to NBSR makes sense, especially when considering the following: When does the exclusive CN/Irving deal which was signed pre-MMA expire? I believe that was a 20 year agreement if my memory is accurate. With that in my mind as well as the fact that CP has much more pull in Ottawa (and Montreal) in case oil again flows via the rails, it makes sense that the speculation is not wild.

The cat is out of the bag; CP it is:

https://markets.businessinsider.com/new ... 1028706006

And the winner is....

Canadian Pacific (TSX: CP) (NYSE: CP) and Fortress Transportation and Infrastructure Investors LLC (NYSE: FTAI) announced they have entered into a definitive agreement whereby CP will acquire the Central Maine & Quebec Railway ("CMQ").

https://www.cpr.ca/en/media/cp-to-acqui ... -from-ftai


Wow... didn't see this coming. CP is coming back to Maine (and presumably, far northern Vermont).

Cowford wrote: ↑Sat Oct 26, 2019 7:58 amAnd regardless of what happens, who gets (stuck with) the Rockland Branch?

Good question, I've been wondering the same thing myself. I certainly don't see CP, or Pan Am being interested in it.

Big surprise to see CP back in Maine after 25 years from selling the line. Sounds like form the article for now CP would run Rockland but I agree that they may not renew after the contract up. Going to be interesting to see what CP dose in Maine as well as the CMQ locomotive and BAR 502.

https://www.cpr.ca/en/media/cp-to-acqui ... -from-ftai

Now that WATCO has established a presence in Maine, it seems likely that they would have some interest in operating the Rockland Branch once the CMQ contract is up.

This sounds great, but is it really? I have heard a rumor that C. P. plans to shut it down for a tax write off.
Mike

And you for some reason believe that a Class I railroad would spend $130M (in cash by the way) just to buy a shortline in order to shut it down as a tax write off?

I'll confidently kill that one here and now thanks.

Get your pics of Newport Sub while you can...

To CN9634: I did not say I believed it. You did not have to bite my head off.
Mike

From what I have seen (from the same person who posted about CMQ being sold, and CP being the high bidder) on Facebook, CP is interested in expanding Searsport. I know Kevin Burkholder posted about the CMQ motive power including the 502 are now owned by CP. I know his info isn't always the best, but it will be interesting to see if they sell the 502, or rebuild it for use on their OCS. I am wondering what will happen about the wreck train, since FTAI is holding onto KRS, and KRS from the few times I have been up there, have been using the crane to preform wheel changes on cars. Also the 5017 I assume will go to CP since it is reportedly under CMQ ownership.

When it comes down to what the CP will do with the current CMQ motive power, railfans need to take a realistic view. Let's face it: while some CMQ locomotives are nicely painted and/or historic in nature, as part of the CP's motive power picture they are "pure junk". CP has plenty of locomotives throughout its vast system that are much newer and in much better mechanical shape than those now on the CMQ. Railfans need to accept that CP WILL assign whatever locomotives CP sees best fit to operate its new acquisition. CP is in business to make money, not please the railfan world. if railfans truly want to see #502 and/or a CMQ painted locomotive preserve, now is the time to get the 470 Railroad Club or Railroad Museum of New England interested in seeking a donation--or perhaps the Conway Scenic purchasing a unit. Otherwise, the #502 and/or the CMQ heritage will be likely lost to New England railroading/preservation forever!

So given CP is to acquire Central Maine & Quebec Railway, Pan Am will no longer be the only carrier offering direct single line service between Maine and the Maritimes (ie the Irving railroads New Brunswick Southern and Eastern Northern Maine Railway) and the Albany area (although I guess it could be argued that CN links Irving traffic to upstate NY and midwest). And CP's single line reach for traffic to/from Maine will extend well into NS / CSX territory in the midwest. Is there much Maine/Maritime - US bridge traffic currently running on NS/PAS/PAR? For example, I have seen centerbeams loaded with Moose River lumber (Jackman, ME) passing through Ayer MA on Pan Am POED trains. I'm guessing CP can also originate a lot of inbound LPG loads to Maine/Maritimes. Thoughts?

https://www.cmqrailway.com/wp-content/u ... 90129B.pdf

mkittredge wrote: ↑Wed Nov 20, 2019 8:26 pm To CN9634: I did not say I believed it. You did not have to bite my head off.
Mike

The reason rumors like this have legs is because people spread them.... so that's why I posted as I did.

Back to reality (wait is this for real?). I suspect CP has some business lined up. If you look at their investor calls the last few periods, including their large annual presentation, their model is build to fit the needs of the business and customers. My understanding is Searsport is a large piece of this puzzle, which given the Yard was just rebuilt, the crane and port infrastructure is in good shape, and it is very underutilized, I wouldn't be surprised if some port moves come almost immediately in the near term.

The auto contract that CP won back starts in 2020, although it isn't set to reach prime until Summer 2020, but I wonder if there is export opportunity for autos as part of this?

Also-- Potash. Look at the Canadian Interswitching rules and the Windsor - Quebec corridor clause in particular. Back in 2001, MMA received a 111-car Potash train from Canpotex to go to Saint John, however NBSR refused it because MMA would not guarantee insurance on the freight over their line. Then kick in the new interswitching rules and that possibililty was off the table.... but now, CP can feasibly move the nearest interchange out of the Windsor-Quebec corridor. Canpotex already applied for an interswitching judgement against CN into Saint John in 2018, which was ruled down due to this clause.... so now I suspect they re-apply and are granted the action, and you'll see a 50/50 split of Potash going CN/CP into Saint John.

Last item-- all the mill investment in Maine. Effectively you create a direct ST interchange at NMJ, instead of a ST-PAS routing. Now all the paper and pulp carloads can route around PAS, or CSX, or NS, to reach the midwest. Heck, you can see ST-CP-BNSF/UP routings come out of the woodwork and really put a beating on the PAS gateway traffic. All the propane traffic in Maine on ST/CMQ/NBSR/SLR? That could get locked up too. I think there is a lot of business here to be had. Ethanol to Searsport? why not. It comes in by rail to NYC and is sent by ship to Searsport. Anything is possible now my friends.

That could dry up a good chunk of traffic west of Rigby..