CMQ for sale?

Discussion of present-day CM&Q operations, as well as discussion of predecessors Montreal, Maine & Atlantic Railway (MMA) and Bangor & Aroostook Railroad (BAR).

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KSmitty
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Location: Maine

Re: CMQ for sale?

Post by KSmitty »

And you're missing the point entirely if you think any CP interest in Searsport is about containers and intermodal.

Searsport never has been, is not now, and never will be a large intermodal port with thousands of TEU's coming and going by ship and by rail each week. Panamax ships can have a draft as deep as 40 feet. Searsport has a draft of about 30 feet. And ships built to fit the canal aren't even the upper end of container ships as far as size goes. Several carriers are operating ships as deep as 45-50 feet. Sure you can play the tide and add another 10 feet of draft, but you also burn half a day which is an impractical solution when you talk about shipping. Its big bucks to have a huge ship sitting there waiting for the tide to come in, and the larger the ship, the more it costs to sit.

Intermodal and auto operations on the former CM&Q will be anchored in Saint John, as both the intermodal and auto facilities in the city are on the former CP now Irving owned and operated side of the city. However, the bulk facilities are on the CN side, which is where Searsport will prove its value, if it has any to CP. The root of Searsport's value to the railroad has always been oil, and bulk products, liquid and solid. Bulk ships are generally smaller and Searsport already hosts these ships to serve existing terminals there. Oil, slurry and other existing customers in Searsport may have been of some interest to CP, but any serious investment in Searsport will be for the construction of facilities to handle potash and/or grain.

CP, through CM&Q lost its bid to operate potash to Saint John, as the potash terminal in Saint John is on the CN side of the city. While Irving currently leases CN's industrial tracks in Saint John, CN was able to put up a legal blockade of the facility to CP. CP's claim for inter-switching rights failed because their property ended too far from Saint John, outside 150 miles. Irving and CM&Q cannot act as proxies to close the gap. You can speculate that the move to Brownville will allow CP to connect directly to NBSR and put them in range of the potash terminal in Saint John. But Irving's lease on the CN side of the city expires next year, and it sounds like CN is not interested in renewing that contract. In all likelyhood, this will put that off limits to CP.

CP has large contracts with potash suppliers in central Canada and no efficient way to put it on the Atlantic ocean. Which brings us back to Searsport. More than capable of handling the shipping needed for bulk material.

Zeke
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Re: CMQ for sale?

Post by Zeke »

As the only class one east of Montreal CN is making a good buck. CP is sitting on a load of cash grossing C 1.9 Billion in the 3rd quarter, net income C 510 million, share price $ 237 dollars and operating ratio of 56. CEO Keith Creel, HHH's son in law,is implementing a lot the old mans proscriptions in particular the hated, by many PSR.
Also soon to be taken from the back burner to the front burner is Montreal's desire to pay CP a billion dollars to abandon St Luc yard and build a new yard out of town. Montreal has big plans once the property has been remediated and is under their control. For now the financials are quite favorable for Mr. Creel to roll the dice on the CMQ property. Might even be a passenger train in the wind.

Cowford
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Location: Florida

Re: CMQ for sale?

Post by Cowford »

First, Creel is not EHH's son-in-law. Second, source, please, on the contention that EHH stated selling east of Montreal was a mistake.

Other random thoughts:

I don't understand how CP's advance to Brownville Junction helps them any more with access to Saint John in any respect. That's all up to the NBSR. Or am I missing something?

Considering Searsport ripe for expansion is pretty optimistic thinking, no? (I won't go as far as saying "wishful" as the idea may have some merit.) There's not a heck of a lot of room to expand, a LOT of upgrading would be required if the port was to shoehorn in a potash terminal, and a belligerent citizenry awaits (hopefully interstate commerce law would prevail).

Saint John cratered as an container port in the 80s. Why would a carrier choose it over Halifax, Montreal, NYNJ, etc, etc.? What are domestic (CDA-CDA) opportunities?
Last edited by Cowford on Sun Dec 01, 2019 12:40 pm, edited 1 time in total.

bostontrainguy
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Re: CMQ for sale?

Post by bostontrainguy »

Cowford wrote:
Sat Nov 30, 2019 10:03 pm

I don't understand how CP's advance to Brownville Junction helps them any more with access to Saint John in any respect. That's all up the NBSR. Or am I missing something?
Well if you check out the CMQ map it shows haulage rights to Saint John via ERMY and NBSR. Safe to say that CP gets those with the purchase?

gokeefe
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Location: Winthrop, Maine

Re: CMQ for sale?

Post by gokeefe »

I'm on the same page with all of the random thoughts. There has to be more going on here ...
gokeefe

gokeefe
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Re: CMQ for sale?

Post by gokeefe »

bostontrainguy wrote:
Sun Dec 01, 2019 1:04 am
Well if you check out the CMQ map it shows haulage rights to Saint John via ERMY and NBSR. Safe to say that CP gets those with the purchase?
Probably but why the supposed interest on Searsport? I will defer to Cowford on whether or not the haulage rights even matter ...
gokeefe

Zeke
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Re: CMQ for sale?

Post by Zeke »

I saw a you tube video of the Searsport branch and it appeared to go through the heart of the town's residential district. Can't see 200 car DPU-ed potash trains creaking through town at 3 am. Speculating now, maybe Irving wants out of the NBSR and will sell it to CP in the future? What is surprising is CP taking the moosehead with many miles of nothing in the way of revenue and a lot in the way of maintenance. Also there must be 300 miles of ancient stick rail that needs to be replaced and the bypass around Megantic in the initial stages. I agree this is a head scratcher. BTW read EHH's comment regarding sale of the east end as strategic mistake years ago in Barron's. He didn't elaborate and I know all of the reasons CP dumped the east end but EHH was not a conventional railroader in his thinking.

BAR
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Joined: Sun Mar 14, 2004 4:43 pm
Location: Williamsburg, VA

Re: CMQ for sale?

Post by BAR »

I have been on several trackcars trips originating at Searsport and the yard is at the east end of town and there was not much residential near it or on the way out of the yard heading north. With the CP taking over I am not expecting any more trackcar trips out of Searsport (or NMJ for that matter).

BAR

gokeefe
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Re: CMQ for sale?

Post by gokeefe »

Zeke wrote:
Sun Dec 01, 2019 4:25 am
I saw a you tube video of the Searsport branch and it appeared to go through the heart of the town's residential district.
That sounds like the Rockland Branch to me. Operated by CMQ under contract. As others have said the Searsport Branch is in a sparesely populated area.
gokeefe

roberttosh
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Re: CMQ for sale?

Post by roberttosh »

Haulage rights to Saint John would almost certainly be transferred to CP. While Searsport may not presently have the infrastructure to handle unit Crude or Ethanol trains, keep in mind that the Port of Albany didn’t either, but once the opportunity presented itself, facilities for both were built in fairly short order. Whether it’s Searsport or Saint John, gotta believe there’s some type of energy (crude, ethanol, LPG) growth plan in play here.

Cowford
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Re: CMQ for sale?

Post by Cowford »

Referring to Saint John (and existing traffic moving adversely) specifically, and assuming the same haulage rights in place with NBSR will succeed CMQ... believing that CP can be successful in converting potash (and other) traffic currently moving via CN implies that CMQ was pricing themselves out of the market. Hard to believe they weren't hungry enough.

CN9634
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Re: CMQ for sale?

Post by CN9634 »

The Potash story is a more complicated one linked to interswitching rules... CMQ was preparing to handle some unit potash trains early on but the Government did not grant access to CP as the nearest interchange was within the Windsor - Quebec exemption corridor. But now... that changes.

There is already business on the hook for CP in the new territory, it likely won't come online day one, but you should notice some volumes pickup for sure. There were a lot of things CMQ was pushing for but simply lacked the resources to put into fruition, I suspect some of those plans will become reality now.
Last edited by MEC407 on Sun Dec 01, 2019 4:22 pm, edited 1 time in total.
Reason: unnecessary quoting

gokeefe
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Re: CMQ for sale?

Post by gokeefe »

I have to say ... This is so strange to be reading about a Class I doing business in Maine. Surreal ...

Did CP ever show any interest in the BAR in the past?
gokeefe

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MEC407
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Re: CMQ for sale?

Post by MEC407 »

In the late '90s and up until about 2003, there were fairly persistent rumors that CP was sniffing around Guilford with acquisition in mind. Never happened, obviously. But is there any chance, even a remote one, that they would be interested in some or all of PAR now that they've got a significant presence in Maine?
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gokeefe
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Re: CMQ for sale?

Post by gokeefe »

Ah the old Buck Dumaine vision resurfaces ...

I would think that CP would be one of the few Class Is that the STB would be comfortable with in this situation. NS, CSX and CN all have their own lanes.

Hard to imagine them not seeing some potential in the connections that Pan Am could offer them ... Doesn't mean they're buying though ... Cowford?
gokeefe

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