Iron Horse Update for February 2014

Southbound MM&A train with Vermont Railway and Montreal, Maine & Atlantic power seen rolling through a meadow in North Troy, VT on its trek between Farnham, Quebec and Newport, VT on June 15, 2013- a few weeks before the deadly explosion after a runaway MM&A oil train derailed in Lac Megantic, Quebec. Richard Deuso photo

MONTREAL, MAINE & ATLANTIC- After months of speculation and uncertainty, the beleaguered Montreal, Maine & Atlantic has a new owner.

New York-based hedge fund Fortress Investment Group [NYSE- FIG] was announced as the winning bidder in a Jan 23rd bankruptcy auction. Other bidders reportedly included Pan Am Railways and JD Irving, parent company of the New Brunswick Southern railroad and the refinery that the oil being hauled by the ill-fated MM&A train was destined for. Within days of the winning bid being announced, courts in both Canada and the USA approved the sale to Fortress.

Largely shut down in the wake of the July 2013 Lac Megantic derailment that killed 46 people, the Montreal, Maine & Atlantic filed for bankruptcy shortly after the disaster, the MM&A ran a test train through the La Megantic in December in anticipation of fully reopening the line. Reports surfaced in September 2013 that the oil being shipped was much more volatile than the manifest indicated. In 2010, the MM&A and the state of Maine agreed to terms on the sale of more than 230 miles of lines in northern Maine. By early 2011, the state of Maine had contracted with JD Irving to operate freight service over the recently sold lines between Madawaska and Millinocket.

Fortress Investment Group has also been the parent company of the Florida East Coast Railway since 2007 and was majority owners of shortline holding company Rail America until their 2013 sale to Genesee & Wyoming. The FEC has won a number of industry awards for safety, a background that could prove useful in persuading otherwise reluctant Canadian officials into allowing oil to once again move over Fortress-owned MM&A trackage. Shortly after the MM&A sale was made official, Great Northern paper of Millinocket, ME announced they would be suspending operations for sixteen weeks, depriving the railroad of a major shipper.

Other assets owned completely or partially by Fortress include private aircraft leasing firm Aircastle [NYSE- AYR], Luxembourg-based reality company GAGFAH, Brookdale Senior Housing [NYSE- BKD] and Canadian ski resort company Intrawest.

Union Pacific SD70M #4884 is seen leading 'Big Boy' locomotive #4014 through Ontario, CA en route to the former Southern Pacific yard in Colton, CA on Jan 25th, 2014. The locomotive was removed from the Los Angeles County Fairground Complex at Pomona, CA using temporary track and its final destination will be Cheyenne, WY. Matthew Griffin photo

UNION PACIFIC- Union Pacific's 4-8-8-4 'Big Boy' is on the move after crews painstakingly moved the giant steam locomotive out of the LA County Fairplex at Pomona on temporary track and onto the mainline to the former Southern Pacific facilities at Colton, CA.

The behemoth locomotive has another 1200 miles to go before reaching its final destination of Cheyenne, WY but will reportedly be on display in Colton for the first two weekends of February. In exchange for the Big Boy, the Rail Giants museum at the Pomona Fairplex will receive Union Pacific SD40-2 #3105 as well as a caboose and boxcar. Although the 4014 was the biggest steam locomotive on display, it was by no means the only one- Santa Fe 4-6-4 #3450, Union Pacific 4-12-2 #9000 and Southern Pacific 4-10-2 #5021 remain on display on the grounds along with restored freight cars.

The largest steam locomotive ever built, the Alco built Big Boys hauled freight and passengers for the Union Pacific over the Wasatch Range between Cheyenne, WY and Salt Lake City, UT in the 1940s up until dieselization in the 1950s. There are several surviving examples of the Union Pacific's Big Boys on static display- most notably in Cheyenne, WY and Steamtown National Historic Site in Scranton, PA- but after an exhaustive search, the Union Pacific determined that the #4014 in Pomona was the best candidate for a full restoration.

Motive Power Inc. HSP-46 demonstrator #2100 seen undergoing outdoor testing at the MBTA's South Station engine terminal in Boston, MA. David Hutchinson photo

MBTA- The first units from MBTA's order with Westinghouse Air Brake Technologies [NYSE- WAB] subsidiary Motive Power Inc have arrived and are undergoing testing on MBTA and elsewhere.

In 2010, the MBTA Board of Directors approved an initial 20-unit, $115 million order with Boise, ID-based MPI. However, since then the order has been upped to 40. The new locomotives are designated HSP-46 and are powered by General Electric GEVO engines and clock in at 4600 HP each. So far only one unit is on T property and has been undergoing compatibility testing with the electronic systems in the T's various coaches manufactured by Bombardier and Kawasaki. Two other HSP-46s are currently undergoing testing- one at GE's East Erie, PA test facility and the other at the FRA's Transportation Technology Center in Pueblo, CO.

Oddly, this isn't the first appearance of MPI power on the T- the agency purchased two MP36PH-3Cs from Motive Power, Inc. The locomotives were originally intended for Utah's Front Runner commuter rail before the order was partially cancelled. For commuter rail, the T has been using 1970s built F40PHs along with rebuilt GP40MCs for passenger service along with some GP9s, GP40s and an NRE genset used for maintenance of way service.


MISSISSIPPI- At least 18 cars on a Canadian National train- some of them carrying hazardous cargo- outside of the southern Mississippi town of New Augusta derailed over the weekend. First responders were able set up barriers around some of the cars that had derailed and both lanes of nearby US highway 98 were shut down.

The train was carrying crude oil, liquid fertilizer and methanol- a state department of Environmental Quality official described the site as dangerous, but more dangerous to the first responders than the public.