Montreal, Maine & Atlantic can operate until Feb. 1

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OTTAWA – Canadian regulators will allow the Montreal, Maine & Atlantic Railway to remain in operation until Feb. 1, 2014, the Toronto Globe & Mail reports. The railroad has struggled in the wake of an oil train derailment in Lac-Mégantic, Quebec, on July 6 that killed 47 people and destroyed several buildings in the town. Regulators previously granted permission for the railroad to operate in Canada until Oct. 18.

The Canadian Transportation Agency cites an 80 per cent drop in the volume of dangerous goods transported by the MM&A as a reason for its decision to allow MM&A to keep operating. The railroad declared bankruptcy on Aug. 7 since it faced cleanup costs of at least $200 million and multiple lawsuits that could cost millions more. A sale of the railroad is expected in mid-December.

MM&A says it will no longer accept oil trains on the railroad. The chairman of the railroad’s parent company, Ed Burkhardt, stands by the decision to stop moving oil. “I didn’t think anyone would be interested in shipping oil with us, and we weren’t interested in handling oil anymore,” he says.

With the MM&A system split in half by the derailment, overall traffic is down 70 percent. Work to rebuild the tracks through Lac-Mégantic will start late this month. With the sale pending, Burkhardt says reopening the line is “essential” for it to be profitable.
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