Railroad In Deadly Canadian Crash Files Bankruptcy
RENEE MONTAGNE, HOST:
The railroad involved in a dramatic runaway train crash in Quebec last month is filing for bankruptcy. The Montreal, Maine and Atlantic train was hauling 72 tankers full of crude oil when it crashed and exploded, engulfing a rural town in flames leaving 47 people dead.
NPR's Jeff Brady reports the company filed for bankruptcy both in the U.S. and in Canada.
JEFF BRADY, BYLINE: The bankruptcy was not a surprise. In the days after the accident, board chairman Edward Burkhardt was in the small town of Lac-Megantic, where reporters asked if his company would be able to survive the disaster.
EDWARD BURKHARDT: We have a lot of insurance and I'm not going to advise at this point what our limits are. I think our limits are going to be tested.
BRADY: In a written statement Wednesday, Burkhardt said even with prospective insurance recoveries, his company's obligations now exceed the value of the assets.
Chris Damas is an energy and transportation analyst with BCMI Research, based outside of Toronto. He says the railroad is privately held, so it's difficult to know exactly how much the company is worth.
CHRIS DAMAS: You can look at what they have in terms of line - a little over 500 miles of lines, locomotives, and it's a relatively small railway.
BRADY: Damas says a company this size - there's no way it could come up with enough resources to pay for all the damage the accident caused.
DAMAS: I believe that with the environmental disaster in the town and plus all the casualties and loss to businesses, I think it will be at least two to 300 million - maybe more.
BRADY: Despite the bankruptcy, the Montreal, Maine and Atlantic Railway says it plans to continue operating along its routes in Quebec, Maine and Vermont. Though earlier this week, company executives announced they will no longer transport oil.
Authorities in Canada are still investigating what caused the crash. U.S. and Canadian regulators have issued new rules for all railroads that are designed to make transporting hazardous materials, like oil, safer.
Jeff Brady, NPR News. Transcript provided by NPR, Copyright NPR.