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Ailing MM&A given extension to keep operating until Feb. 1

Edward Burkhardt, chairman of Montreal, Maine & Atlantic Railway, leaves the provincial police station in Lac-Mégantic, Que., on June 10, 2013.


The struggling railway involved in the deadly derailment in Lac-Mégantic, Que., has been given an extension to continue operating until Feb. 1 by federal regulators as it grapples with a drastic decline in clients and a looming sale.

In a decision made public Wednesday, the Canadian Transportation Agency cited an 80 per cent drop in the volume of dangerous goods transported by the Montreal, Maine & Atlantic Railway as a reason for its decision. In the wake of the July 6 disaster that claimed 47 lives, the railway ceased transporting crude oil.

Despite the steep decline in traffic, the chairman of MM&A's parent company stood by its choice to stop moving oil.

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"I didn't think anyone would be interested in shipping oil with us, and we weren't interested in handling oil any more," Ed Burkhardt said.

With the railway's network still split in half by the ruined tracks in the centre of Lac-Mégantic, overall traffic is down 70 per cent.

On Tuesday, Lac-Mégantic announced work to rebuild the tracks through town would start in late October. The rebuilding is expected to last a few weeks. The company is expected to be sold by mid-December, so reconnecting the broken network would be "essential" for it to be profitable, according to Mr. Burkhardt.

The MM&A filed for creditor protection on Aug. 7, facing a cleanup bill of at least $200-million and multiple lawsuits that could cost millions more. To continue operating in Canada, the railway provided federal authorities with proof that it holds adequate insurance to cover operations.

The railway continues to operate three or four trains daily between factories alongside its tracks. Before the disaster, as many as 15 trains plied the network daily, some travelling the long distance from Montreal to the Atlantic Ocean. None has done so since July 5.

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