• Pan Am Railways For Sale?

  • Guilford Rail System changed its name to Pan Am Railways in 2006. Discussion relating to the current operations of the Boston & Maine, the Maine Central, and the Springfield Terminal railroads (as well as the Delaware & Hudson while it was under Guilford control until 1988). Official site can be found here: PANAMRAILWAYS.COM.
Guilford Rail System changed its name to Pan Am Railways in 2006. Discussion relating to the current operations of the Boston & Maine, the Maine Central, and the Springfield Terminal railroads (as well as the Delaware & Hudson while it was under Guilford control until 1988). Official site can be found here: PANAMRAILWAYS.COM.

Moderator: MEC407

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  by gokeefe
 
Exactly Mr. Norman which is why the report of Class I interest (by CN no less) is so intriguing.

I would note the "crickets" chirping in response to any question about whether or not CN has any known residual commerical rights over any of it's former New England properties (CV-NECR or GT-SLR).

I haven't been able to find any indication of this at all and their system map doesn't appear to reflect any residual interests.

So ... Not even a hint of potential explanation for CN's supposed deal to acquire PAR.

Sent from my Pixel 2 XL using Tapatalk

  by CN9634
 
There are Long-time established agreements with CN and their former lines here in New England. There is a paper interchange with CN at Danville Jct with Pan Am (ST) that is to say cars can be routed ST-CN directly (no SLR appears in the system routing although obviously they are there). You can find the routing guide linked below. Also, the CN map does have the ‘short line partners’ listed on their map and I see SLR and NECR there, so I’m not sure what you are getting at. I was told many years ago, and who knows now how much it weighs true or not, that the SLR was simply a paper railroad for CN.

http://www.panamrailways.com/maps-and-routing-guide
  by bsweep
 
It is not out of the realm of possibilities that CN is taking a hard look at the property in an effort to drive up the price and/or thwart any further CP expansion. For argument's sake only (as I still think Irving will express more than a passing glance) - imagine the havoc which could be created in CP's plan if Irving sold out to CN in addition to CN acquiring Pan Am...
  by Cosakita18
 
bsweep wrote: Thu Jul 09, 2020 7:46 am - imagine the havoc which could be created in CP's plan if Irving sold out to CN in addition to CN acquiring Pan Am...
Irving is never going to sell out to either CN or CP. NBSR is far too integral to their forestry and paper services. Through NBSR they have total control over their supply chain and very favorable transportation costs. That's not something they're going to give up.

Irving will, however, almost certainly be cozying up to CP in the near future. The two parties are actively working out trackage agreements between Brownville and SJ.
  by bsweep
 
Cosakita18 wrote:Irving is never going to sell out to either CN or CP. NBSR is far too integral to their forestry and paper services. Through NBSR they have total control over their supply chain and very favorable transportation costs. That's not something they're going to give up
I actually agree with you 100%. That's why I proposed yesterday Irving would look at Pan Am. Irving produced chips and forest products end up in places outside of solely their mills - hence my proposition they would look at Pan Am. Heck, if Irving owned Pan Am they could move their trucks of 2*4's from I-95 from Maine and NB to Boston.

Like I said, that was for argument's sake only as the above proposition seems to be rejected wholly by some on this board. But time will tell.
  by Gilbert B Norman
 
Mr. Sweep, while "it's been a while" since I've had occasion to drive in Maine, I nevertheless have had the experience of trying to get passed a semi hauling raw "Products of Forests" (that is an AAR term, incidentally) on a Maine two lane "highway" (sorry Mr. O'Keefe). My auto, then and especially now, does not like the "droppings that fall from such lading.

So I guess that any such lading that can be off the highway and on to the rails is a benefit to the motoring public. Again though, JD Irving apparently can live with FRA Class 2 (25mph) track for their needs to move raw product from Eastern Maine to St. John. Would they be prepared to maintain a road to Class 3 (40mph), or in the case of where passenger trains now operate, simply "mooch" off the sponsoring agency and their need (handling passenger trains) for Class 4 (60F/80P).

I've seen that happen in my backyard, where Federal Funds under the guise of improved passenger service Chi-St Louis, built the UP a new route to handle their traffic into Chicago.

better add the disclaimer: author Long UNP
  by PBMcGinnis
 
One other thought..,
While Irving may through their railroad, NBSR, have interest in buying the railroad from Mattawamkeag to Ayer, MA....

I can think of 4 other paper mills currently served by Pan Am that would have competitive rates and anti-trust concerns against such an acquisition. Not good when your biggest competition in the New England and Northeast Atlantic owns the very railroad that serves your mill. Plus Irving is a foreign competitor, which has cross-border competitive and tariff implications as well.
  by MaineCentral252
 
PAR as a whole is WAY beyond the scope of Irving's business. They got into the railroad business and added to it out of necessity, as they were in danger of losing their critical supply line. CP is a possibility for the west end, but not the Maine Central, as that would give them a near monopoly on routes into or out of Maine. From a fair competition standpoint, at least the Maine Central portion as far as Ayer would need to be an independent regional, with connections to CSX, NS (directly or indirectly), CP, and CN (indirectly via SLR).

The Maine Central and eastern B&M is in a unique situation, with the potential for a decent volume of traffic, providing service is up to snuff. Transload, warehousing services, and to an extent, intermodal, are all ways to bring in lower volume traffic, but if and only if the new owner knows what they are doing in the logistics world. That's the reality of Maine's traffic, and any owner needs to be able to handle and work with that if they want any level of success, because doing the bare minimum to scrape by won't cut it. The paper mills, other customers, and class I connectors all know this.
  by gokeefe
 

CN9634 wrote:There are Long-time established agreements with CN and their former lines here in New England. There is a paper interchange with CN at Danville Jct with Pan Am (ST) that is to say cars can be routed ST-CN directly (no SLR appears in the system routing although obviously they are there). You can find the routing guide linked below. Also, the CN map does have the ‘short line partners’ listed on their map and I see SLR and NECR there, so I’m not sure what you are getting at. I was told many years ago, and who knows now how much it weighs true or not, that the SLR was simply a paper railroad for CN.

http://www.panamrailways.com/maps-and-routing-guide
Thanks for pointing me in the right direction on this. :)

I think it's fascinating that CN's interchange with Pan Am occurs at Danville Junction. That certainly helps explain how CN could see strong value in this transaction. Along with NECR that makes for a very strong combination.

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  by bsweep
 
PBMcGinnis wrote:One other thought..,
While Irving may through their railroad, NBSR, have interest in buying the railroad from Mattawamkeag to Ayer, MA....

I can think of 4 other paper mills currently served by Pan Am that would have competitive rates and anti-trust concerns against such an acquisition. Not good when your biggest competition in the New England and Northeast Atlantic owns the very railroad that serves your mill. Plus Irving is a foreign competitor, which has cross-border competitive and tariff implications as well.
Fair point, but consider they already serve several domestic competitors in Northern Maine.
Gilbert B Norman wrote: So I guess that any such lading that can be off the highway and on to the rails is a benefit to the motoring public. Again though, JD Irving apparently can live with FRA Class 2 (25mph) track for their needs to move raw product from Eastern Maine to St. John. Would they be prepared to maintain a road to Class 3 (40mph), or in the case of where passenger trains now operate, simply "mooch" off the sponsoring agency and their need (handling passenger trains) for Class 4 (60F/80P).
Irving currently is bringing the rest of the EMRY and NBSR proper back to Class 3 (as we speak) and that was done with grant money and in the works before the CP purchase of the CMQ. Their limiting factor is that their chip cars are limited to 25 mph. Irving also works extensively as a railwork contractor all over the East coast of the US, so they are more than equipped to maintain track to whatever speed is needed. And, let's be clear, maintaining Pan Am (MEC) to Class 2 would be an improvement over most of the line.
MaineCentral252 wrote:PAR as a whole is WAY beyond the scope of Irving's business. They got into the railroad business and added to it out of necessity, as they were in danger of losing their critical supply line.
I would argue (and for full disclosure, I live within biking distance to both EMRY and Pan Am) that the MNR was beyond the scope of Irving's business. It was only after their long term lease of the property that suddenly chips STARTED to move from ME to NB via rail. I have no idea how many chips originate from the Irving Woodlands along Route 11 that end up in central ME mills, but whatever it is moves via firms like Gardner trucking and not rail.
  by S1f3432
 
bsweep said " I have no idea how many chips originate from the Irving Woodlands along Route 11 that end up in central ME mills, but whatever it is moves via firms like Gardner trucking and not rail."
BAR and MEC used to move trainloads of wood from northern and eastern Maine to IP and Boise-Cascade but GTI quoted rates reflecting the cost of upgrading the branches and purchasing new rolling stock- with that, the traffic
shifted to trucks almost overnight. Pehaps part of a strategy to get rid of the branches. Still, its probably unlikely this traffic would return with the overall decline of the paper industry and wood products in general.
  by bsweep
 
My observation anecdotally is that chip and log movement deals work well until multiple lines become necessary splitting revenue and profit on a low margin commodity. BAR and MMA moved chips from MNR territory to Old Town but trans-loaded them to truck for the final 20 miles. As I said, NBSR didn't handle chips from BAR/MMA in large numbers, but when they leased the MNR they started running in huge numbers, even occasional unit trains. CMQ handled logs for Pleasant River in Jackman, but those haven't been interchanged either. Even CN still handles a figurative ton (literally tons) of logs and chips in Wisconsin. I don't think much of those are interchanged.
  by newpylong
 
I think everyone is going to be (pleasantly) surprised what traffic can be conjured given the right purchaser. Pan Am Marketing has gotten much better, and more creative in recent years, but they've never had the Transportation department or infrastructure to follow through in many cases.
  by MaineCentral252
 
It's no secret that the Maine mills could move a lot more product by rail if the service was there, and I think the same could be said for a lot of traffic. Chips and logs can be a solid source of traffic, and therefore cash flow, but they are a high volume, low margin commodity. If the right players are in place, and things work efficiently (meaning seamless and vertically integrated), it could work. Irving has made it work because of vertical integration, and because they have skin in the game. They couldn't risk losing what is a vital connection for them. That's not saying Irving is the only potential player that could make wood movements work.
  by BandA
 
This would be a great, and possibly the only opportunity in a lifetime, to eliminate "paper barriers". If PAR wants to sell to X then they have to give up some anti-competitive barriers. For example the mountain division?

I assume we are in the steel-tire kicking phase. How long until we know something? Two or three months?
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