When a train carrying 72 tanker cars of oil crashed and exploded July 6 in Lac-Megantic, Quebec, the economic effect was felt all the way down the tracks.

The town 10 miles from the Maine border probably will take decades to recover from the tragedy. Forty-seven people died, five are still missing and the cleanup is expected to cost millions. That doesn’t even take into account the devastation to the town of 6,000, which has relied on the railroad for 145 years.

Across the border, however, smaller ripples also have been felt, particularly in Jackman, where the train stops to pick up loads from the Moose River Lumber Co.

Montreal, Maine & Atlantic Railway, the Maine-based company that owns the train that crashed, has stopped service at the Lac-Megantic station, which means Jackman, the next eastbound stop about 44 miles away, is not getting any train service.

The railroad has said it may be able to restore service to some of the undamaged tracks at Lac-Megantic as early as this week, but there is no telling what the crash’s long-term effect could be on the railway’s future.

On Wednesday, the railroad filed for Chapter 11 bankruptcy protection. The company’s chairman had said previously that the filing was likely because the Hermon-based railroad’s lines remained closed in Lac-Megantic.

Some of the railroad’s customers, including Moose River Lumber, are concerned that with litigation, tougher rules for railroads such as the ones established Friday night by the Federal Railroad Administration and other prolonged issues, MM&A won’t be able to operate economically.

Barbara Kane, chairwoman of the Jackman Planning Board and a board member on the Somerset County Economic Development Council, said that with 75 employees, the lumber company is the largest employer in Jackman and neighboring Moose River, the combined population of which is about 1,000 people.

In the days since the Lac-Megantic train derailment, she said, residents have become concerned not only about the welfare of people in the nearby Canadian town, many of whom have family ties to Jackman, but also about the railroad’s safety and the future of their workforce.

“The rail line has been a big part of our infrastructure since the late 1800s. They move a lot of products, and it is pretty interwoven in our economy,” Kane said.

Moose River Lumber supports logging and trucking as well as other businesses in the area, she said.

“The people that work there are a part of our community. Any interruption in their production affects the business of the town,” Kane said.

Steve Banahan, sales and transportation manager for Moose River Lumber, said Wednesday that he hopes the line will re-open so his company can ship to Montreal, but that he hasn’t heard anything about that possibility from his discussions with MM&A. Even if the railroad does reopen, Banahan said he is still concerned about the future.

“Yes, we need to get the line back open, but we have no idea what the long-term liability of MM&A might be,” Banahan said.

Moose River Lumber, which produces about 120 million board feet a year, according to the company’s website, has used the railway for the last 10 to 12 years for about 30 percent of its transport, Banahan said. The rest is done by truck, which is more expensive.

The company, which processes spruce fir from Maine and Quebec and turns it into dimension lumber for building houses, relies on the railroad for bringing logs in as well as shipping lumber out. The lumber is shipped west, passing through Lac-Megantic on its way to Montreal, before distribution on the eastern seaboard, Banahan said.

With the Lac-Megantic rail station closed, lumber must travel back east to Brownville Junction, which costs about $500 to $1,500 more per car. In the course of one year, the company ships about 150 to 200 cars, Banahan said.

“We’ve felt the impact both on the inbound side, with our raw materials, as well as on the outbound side, trying to get our product to other markets,” Banahan said.

State pledges help

Ted Talbot, a spokesman for the Maine Department of Transportation, said that in addition to conducting safety evaluations of all of Maine’s railways, the state has developed contingency plans to support business in northern Maine, should the railway shut down.

Although Moose River Lumber is the railway’s only customer that ships and receives at the Jackman station, the track runs east to Brownville Junction and eventually New Brunswick. Other trains pass through the station from Maine and Canada, and they face the same problem.

Talbot said the state has received complaints from customers concerned about the railway’s future, but he could not reveal the names of the companies that complained.

Mary Keith, spokeswoman for J.D. Irving Ltd., a lumber, paper and pulp products company based in New Brunswick, said the company is one of many with operations in Maine that depend on the railway for shipping products to western and southern U.S. markets as well as receiving inbound raw materials for manufacturing operations.

“Connections to the MM&A are vital to our operations and the customers we connect via our railroads,” Keith said in an email. “We are maintaining open lines of communication with the state regarding the importance of sustaining viable rail links.”

MM&A chairman Ed Burkhardt would not release the names of the railroad’s customers.

Since the accident, the railroad has suffered a decrease in revenue and traffic, he said. In an interview with the Canadian Press, Burkhardt said the company is depending on its insurance company to start paying for the Lac-Megantic cleanup effort, which he estimates to cost $7.8 million.

“It’s very much under consideration right now,” Burkhardt told the Canadian Press when asked whether he thought MM&A could survive financially.

Shipping and safety concerns

Talbot said the state is working on a safety review of all railways as well as a contingency plan to help businesses and shippers in the area, such as Moose River Lumber, should the railway, one of the state’s five major freight lines, close. The others are Eastern Maine Railway-Northern Maine Railway, Maine Eastern Railroad, Pan Am Railways and St. Lawrence & Atlantic Railroad.

“Our main focus is on businesses and ensuring they have viable options for shipping, whether it is through other rail carriers or by other means such as boat or truck,” Talbot said.

He said the state also is preparing for possible service disruptions and the legal process for closing the railroad, which would involve adhering to federal regulations.

In Jackman, Kane said the town has its own concerns about railroad safety. The MM&A line intersects U.S. Route 201, which also serves as Main Street in the town. A lifelong resident of Jackman, Kane, 64, said that while traffic on the rail line has decreased in recent years, she has noticed an increase in the amount of crude oil transported over the last 12 months.

And even though Burkhardt has said that MM&A no longer will transport oil, the railway does carry other hazardous material, such as alcohol, chlorine and methanol. The railroad’s proximity to downtown Jackman and nearby waterways is cause for concern, Kane said.

“It’s a lot of volatile product going through a populated area. It’s definitely something we are aware of, and we want to make sure our town is safe,” she said.

Rachel Ohm — 612-2368
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