Short line company Quebec Railway Corp. (QRC) has announced it will sell CN three rail lines and its stake in a rail-freight ferry operation in Eastern Canada.
CN will pay $49.8 million for the lines and ferry business, having sold the rail lines to QRC in the first place, in the late 1990s. CN has also held a minority stake in the ferry service since 1975.
“With our close partnership over the years, CN was the logical purchaser of these properties after QRC decided to dispose of key assets,” QRC chairman Pierre Martin said in a CN release Monday.
“The operations we’re buying are important to CN because QRC is our second-largest short-line partner, serving important customers at origin and directly feeding our main-line network,” CN CEO Hunter Harrison said in the same release. “QRC has done a great job with these rail properties, and we believe can improve on that in future.”
CN said it will fund upgrades to these rail lines and will replace their locomotive fleets with “more modern motive power.” The lines, which employ around 214 people, will be run on a “business as usual” basis under CN ownership.
The properties involved in this deal include:
- New Brunswick East Coast Railway (NBEC), 196 miles of track between Campbellton and Pacific Junction near Moncton, N.B., where it connects with CN lines. It handles mining and pulp and paper traffic and carries Via Rail trains on part of that company’s Montreal-Halifax run.
- Chemin de fer de la Matapedia et du Golfe (CFMG), a 221-mile line that connects with CN track at Riviere-de-Loup, Que., and with NBEC at Campbellton, N.B. It also includes a line between Mont-Joli and Matane, Que., where a rail ferry operates to the north shore of the St. Lawrence River. CFMG’s traffic is mostly in aluminum, paper, forest products and VIA Rail trains, also on part of Via’s Montreal-Halifax run.
- Ottawa Central Railway (OCR), which runs between Coteau, Que., where it interchanges with CN, and Pembroke, Ont., and which runs over Via tracks between Coteau and Ottawa. Its traffic includes newsprint, salt, forest products, steel wire rod and billets.
- Compagnie de gestion de Matane inc. (COGEMA), the shuttle boat-rail freight service on the St. Lawrence River between Matane and Baie-Comeau, Que., and other ports on the North Shore of the Gulf of St. Lawrence when required. The rail ferry has a capacity of 25 rail cars. CFMG connects with the ferry at Matane and connects with CN at Riviere-du-Loup.
Not included in this deal are QRC’s Sydney Coal Railway Inc. subsidiary in Sydney, N.S., nor its Chemin de fer de Charlevoix inc. (CFC) unit which runs east of Quebec City to Clermont, Que.