Iron Horse Update for January 2014

Westbound Dakota, Minnesota & Eastern freight between Huron and Rapid City, SD seen passing through Wall, SD with CP Rail and Dakota, Minnesota & Eastern SD40-2s in June 2007- a year before the CP Rail takeover. JJ Schrader photo

CANADIAN PACIFIC- CP Rail and shortline operator Genesee & Wyoming have reportedly reached a deal to purchase more than 600 miles of former Canadian Pacific (ex Dakota, Minnesota and Eastern, nee Chicago & Northwestern) trackage in South Dakota, Minnesota, Nebraska and Wyoming.

The price tag for the deal was reportedly $210 million and is Genesee & Wyoming's first transaction since last year's takeover of Rail America. The new name for the line will be the Rapid City, Pierre and Eastern and will run from Tracy, MN west to Colony, WY by way of Rapid City and the South Dakota capitol of Pierre. According to a GWR press release, the transaction includes a branch from Rapid City to Dakota Jct, NE as well as trackage rights over CP from Tracy to Mankato, MN to interchange with the Union Pacific as well as trackage right over BNSF between Yale and Watertown, SD and a separate line between Wolsey and Aberdeen, SD where the Rapid City, Pierre & Eastern could also interchange with the independent regional Dakota, Missouri Valley and Western. This stretch of the line primarily hauls ethanol, wheat, bentonite clay and cement.

Prior to 2008, the line was part of the Dakota, Minnesota & Eastern system. The DM&E was reportedly interested in expansion by building a new line in Wyoming to access coal from the Powder River Basin and ship it to power plants throughout the Midwest. However, the line between Pierre and Rapid City featured unstable roadbed as well as aging track and bridges limiting speed limits to 10 MPH over that portion of the line and creating a significant bottleneck. With the 2008 CP Rail takeover, a number of proposed improvements were approved but quickly forgotten after competition from natural gas and regulatory burdens on coal drove prices down and the CP Rail installed Hunter Harrison as its new CEO after a 2012 hostile takeover by the Pershing Square Capital Management hedge fund. With the focus shifting to rising oil traffic from Alberta and North Dakota, the former DM&E lines became viewed as insignificant backwater and an increasing burden by CP Rail management.

The DM&E itself was started up after the Chicago & Northwestern announced their intent to abandon marginal and unprofitable lines through South Dakota and parts of Minnesota in the early 1980s. Responding to pressure from shippers and then-US Senator Larry Pressler, the C&NW spun off their lines between Winona, MN and Rapid City, SD to the newly formed Dakota, Minnesota & Eastern in 1986 and the railroad began operations with castoff equipment and facilities.

In addition to their Powder River ambitions, the DM&E purchased the 1700 mile I&M Rail Link in 2002. The I&M Rail Link ran between the Twin Cities and Kansas City via the former Milwaukee Road/Soo Line main and also ran to Chicago via Iowa. The newly-formed sister railway- called the Iowa, Chicago & Eastern- gave shippers in South Dakota access to the Twin Cities, Chicago, St Louis and the Great Lakes. Ironically, the Canadian Pacific reacquired most of the lines in 2008 with their acquisition of the DM&E and IC&E that their Soo Line subsidiary spun off in the late 1990s. To hardly anybody's surprise, the former IC&E trackage between the Twin Cities and Kansas City as well as the Sabula, IA to Chicago line weren't on the chopping block.

Pere Marquette Berkshire #1225 seen passing a grain elevator in the village of Carland, MI with an excursion on December 13, 2013. Brian Plant photo

MICHIGAN- After a hiatus of nearly four years, Pere Marquette 2-8-4 #1225 is back in service for the Owosso, MI based Steam Railroading Institute. The big Berkshire re-entered service at the end of November, in time for the SRI's Polar Express excursions over the Great Lakes Central Railroad between Owosso and Ashley, MI in December [although some of them were cancelled due to a state of emergency being declared in Shiawassee County, MI due to a snowstorm- NANESB].

The locomotive last ran at the end of 2009, when it was pulled from service for it's FRA-mandated 15 year boiler inspection. A few months prior, the #1225 was one of the marquee attractions at the 2009 Train Fest, which also included fellow Berkshire Nickel Plate #765 and Southern Pacific's colorful 1941-built Daylight #4449.

Appropriately enough, there is another gathering of vintage iron horses- as well as aircraft and autos- within a few months of the #1225's return to service. The gathering is dubbed Locomotives Wings and Wheels and in addition to the #1225, the gathering is scheduled for June 20-22 and will also feature restored WWII era P-51 Mustangs from the Commemorative Air Force as well as SRI's Flagg Coal Company 0-4-0 switcher and visiting steam locomotives from the Little River Railroad.

CANADIAN NATIONAL- Just days after a fiery train wreck and derailment in Casselton, ND, a Canadian National freight carrying crude oil and liquefied propane derailed in rural New Brunswick near the village of Plaster Rock. According to a CN spokesman, 19 cars and one locomotive derailed on the 122-car four locomotive train.

Unlike the Lac Megantic disaster last July of the BNSF oil train explosion in Casselton, ND earlier this month, the CN train involved in the derailment was a mixed freight, meaning it was carrying other commodities besides petroleum and liquefied natural gas. However, the wreck prompted the evacuation of nearby residents and some of the derailed cars burned for four days after the derailment.

Transportation officials believe that a mechanical failure prompted the train to apply the emergency brakes prior to the derailment. There were no reports of injuries to the crew.

Plaster Rock, NB is about 30 miles away from the Canada/US border in the northwestern corner of New Brunswick and has a population of roughly 1100 according to Canada's 2011 census.