Monday, November 03, 2008
CN Purchases NBEC, CFMG, OCR, COGEMA
The CN - Quebec Railway Corporation deal finally hit the news. CN is purchasing most of the assets of the QRC, specifically the CFMG, NBEC, OCR and the COGEMA rail ferry service (CN Press Release, Canadian Press, Financial Post, CNN Money, Progressive Railroading). CN says "Post-transaction, it will be 'business as usual' under CN ownership, with no immediate changes in freight, VIA Rail passenger rail service or employment levels," but we all know there will be changes in the future.
(CFMG = Chemin de fer de Matapedia et Golf, NBEC = New Brunswick East Coast Railway, OCR = Ottawa Central Railway)
From the Canadian Press article: "CN said it plans to invest capital over the next three years to upgrade the rail lines and will replace the existing locomotive fleet with more modern motive power. The company does not plan any changes to freight, VIA Rail passenger rail service or employment levels."
At the same time, Logistec purchased the Sydney Coal Railway (SCR) from the QRC (Logistec release). Logistec owned a portion of the QRC already, and it looks like it will be financing the purchase of SCR from the money it receives from the sale of the other QRC properties.
The Canadian Press article also says that CN will operate the Gaspe line, which makes sense.
The QRC will be left with the Chemin de fer de Charlevoix (CFC) near Quebec City, and that's it.
So, what does this mean? Nothing in the short term. In the long term, the MLW units will all disappear and be replaced by the usual CN units. I expect the maintenance shop in Campbellton (Eastern Rail Services, ERS) will be shut down. The big plus for shippers and passengers is that there should be significant capital investment in the line to bring it up to snuff for the big CN units and trains, and that means faster transit times for passengers and less slow orders. I wouldn't be too surprised to see one of the two regular CN freights (305/308 or 473/474) shifted from the Napadogan subdivision to the former CFMG/NBEC line to replace the NBEC 402/403 freight.
Get your shots of the NBEC and CFMG units while you can!