Algoma Central Sold!

The press releases just dropped this morning. CN has entered an agreement to sell the Algoma Central and various other ex-Wisconsin Central lines in Wisconsin and northern Michigan to Watco.

CN and Watco Reach Agreement on Sale of Rail Lines in Northern Ontario, Wisconsin, and Michigan

Interestingly, the announcement specifically references only “approximately 250 miles” from Sault Ste. Marie to Oba – the last section from Oba to Hearst is apparently not included. It’s being said that CN will continue to own and operate Oba to Hearst, presumably to hold on to ONR interchange traffic from Hearst.

Watco will take over freight traffic on the rest of the line (what little there is north of the Sault) and the release specifically mentions they will also be running the Agawa Canyon Tour Train, and has a Memorandum of Understanding (MOU) with the local Missinaibee Cree regarding potential partnerships (i.e. potential reintroduction of passenger services with the “Bear Train”).

(If you haven’t heard of Watco before, they own and operate a number of shortlines in the US; mostly small obscure ones, with probably their most notable (and also somewhat relevant) property being the Wisconsin Southern (WSOR).)

No further details are available at this time, although the particularist in me is curious to see how certain things shape out.

In particular, I’d be curious to see what the map of ex-WC lines included in Wisconsin and Michigan looks like, and how Watco may organize everything into one or more railroads, and what names they’ll operate under. With Watco already owning WSOR, I could see some system integration and expansion happening there on connecting lines, and/or the creation of one or more new shortlines.

Presumably Watco would the new owner of the Algoma Central name, whether they would use the old AC reporting mark or have to acquire a new one is less clear right now – CN owns that mark, although they could easily transfer it. The question then revolves around existing equipment with AC marks – the passenger equipment for the tour train would almost certainly be included in the sale, and CN still owns around 150 or so pulpwood flatcars with AC reporting marks. Would this equipment get sold, or would CN have to renumber it to remove the AC mark?

I’m even more curious what name the US portions operate under, as Wisconsin Central is even more complicated with CN rostering quite a large amount of cars with WC reporting marks and lettering, as well as many leased cars leased via the WC subsidiary on paper. This makes the prospect of transferring WC name and reporting marks more complicated, so a resurrection of the Wisconsin Central under that name is probably less likely.

It’ll definitely be interesting to see what new or old names the new entity or entities operate under, and if we start seeing “new” (including new-old secondhand) rolling stock in the near future marked for these railroads.

Regardless, it appears a new chapter is now set to begin in the ACR’s history.

Edit: Watco posted this map of acquired lines today on their facebook page:

ACR for Sale: Confirmed

So the last post about the ACR possibly being for sale involved a bit of inference and guess work from the information in the news about “certain lines in Wisconsin, Michigan, and Ontario” from “mostly ex Wisconsin Central” trackage being put up for sale this year, and the general state of CN’s operations on the ACR (nothing’s run between Sault Ste. Marie and Hawk Junction since April).

Local news sources are now reporting they have confirmation from CN this week that the line is in fact for sale and they’ve been in contact with interested parties (although they will not comment further on that as those business negotiations or arrangements are currently in progress).

CN To Sell Algoma Central Railway: Report [SooToday]

Northeastern railway updates: CN to sell ACR, Huron Central gets six-month reprieve [Manitoulin Expositor]

Meanwhile, Huron Central has been doing it’s regular poverty dance, and had been threatening to discontinue operations as of the end of this week, but has agreed to another six months of operation, but are looking for $44million in funding
(mostly from federal and provincial governments) to do maintenance on the line to keep it running.

Millman Industries of Sudbury (which owns Diesel Electric Services) has been indicating an interest in taking over Huron Central if Genesee & Wyoming Canada pulls out, but it’ll be interesting to see how things all shake out with both the Algoma Central, the Huron Central, and likely also the ex SOO/WC CN line coming into the Sault from Michigan over the next year or so. Hopefully we are looking at the start of a new chapter in the ACR’s history, and not a “last chapter”.

The sale of course also leaves large question marks hanging over the Agawa Canyon Tour Train operation – but a lot of money was also just spent this year to construct a brand new station for the tour train over at the former paper mill property redevelopment. The track beyond the mill property now terminates short of the road heading past the power generating station to the park around the historic canal and boat lock, and no longer goes to the old station in the Station Mall parking lot.

ACR on the Chopping Block?

(Note that this posting contains a LOT of supposition.)

Last week Trains magazine put out a news item indicating that CN plans to sell off a fair bit of low density branch lines in Wisconsin, Michigan and Ontario:

TRAINS: CN to sell 850 miles of low-density lines in Wisconsin, Michigan, Ontario

While the article text is behind subscriber access, the sub heading implies that most of the trackage is low traffic ex-Wisconsin Central lines, and while it’s absolutely not made clear what any of the individual lines are, it doesn’t take much supposition to guess that the former Algoma Central trackage is at least a candidate to be included in the “Ontario” part of this collection, with very few on-line customers other than the Essar Steel Algoma mill in the Sault other than a few pulpwood logging operations.

I’ve also been told by local sources that CN is currently not even operating trains between Sault Ste. Marie and Hawk Junction, only operating between Hawk and Hearst to handle bridge traffic between the interchanges/junctions at Hearst, Oba, and Franz. (I’ve been seeing some AC/WC pulpwood cars routing through southern Ontario recently as well which is a fairly new thing – probably taking the long way around to Wisconsin/Michigan with the south end of the ACR not operating.)

On the other hand, the new ferrochrome smelter for the “Ring of Fire” project chose Sault Ste. Marie as the location for construction, and while that won’t be built for a couple years yet, losing rail access to the Sault would be a major problem for that project.

Will have to watch what happens with this one, potentially big changes in the Algoma region. Speculation abounds: Will CN attempt to abandon the line if no buyers found? Will they soldier on? Will Ontario Northland be interested? (Probably the best case for the line, but will ONTC go for it?) Will some other shortline company make a go? (G&W comes to mind, but they’re already claiming poverty on the operations of the Huron Central and threatening to walk away from that one without financial support for track upgrade/maintenance.) Will local interests try to put something together to save the line, similar to what they’re trying to do with the regular Hearst passenger train? (Although this has been dragging on seemingly unsuccessfully for several years now.) And of course, what impact will this have on the popular Agawa Canyon Tour Train? (although cancelled this year because of the pandemic.) Apparently a new station was just built by the old paper mill as part of the redevelopment of that district. Could a new operator other than CN actually be a boon to passenger service restoration if freight and passenger can be operated as a cohesive entity?

Lots to see, and nothing will happen quickly…

Wawa Wood Pellet Mill Closing

Not great news for the Wawa area.

Announced yesterday, it looks like the wood pellet plant south of Hawk Junction is closing its doors indefinitely due to financial issues and economic factors:

Cash-Strapped RenTech Pulls Plug on Wawa Pellet Mill

(Other articles are also indicating that the troubled company lost as much as 17% in stock value on today’s trading by the lunch hour.)

This facility is the one built just off Highway 101 south of Hawk Junction, near the old ACR Limer siding, in 1995-96 by Jaeger Strandboard to produce OSB (oriented strandboard) sheeting and was shut down by Weyerhaeuser, the then-current owner in 2008. In 2013 RenTech bought the idled mill to convert into a wood pellet manufacturing facility, and after some startup issues starting production in 2015, shipping pellets out by covered hopper via CN. And now it appears, closed again in 2017 unless another company decides to purchase the plant from RenTech.

Here we go again – proposals received for ACR passenger service

The deadline for new proposals for operating the Sault Ste. Marie to Hearst passenger service has arrived and the local Sault Star newspaper is reporting on their web site that three proposals have been submitted, with a possible fourth to come from a late arrival to the process:

RFP results in proposals to run train service

After the first attempt at finding an operator which led to the selection of RailMark Inc., which for several complicated reasons did not end well, it appears that this time the working group will have all proposals reviewed by a third party consultant to compare the submitted proposals to the information contained in the RFP (Request for Proposals) and also do additional background checking of each company.

Once the proposals have been compared, they will then be reviewed by the stakeholder group and CN. Obviously CN, as the owner of the tracks, will have to provide their approval of the operator, and the group hopes to have the city’s nod as well, as the administrator of the federal funding, before a selected proposal is submitted to Transport Canada for approval. With a federal election and possible changes in the government just weeks away, it’s expected that such a submission will occur after the October election.

The article notes that some of the pre-conditions for approval (which RailMark notably failed to meet) will be the same this time around.

It’s also noted that the proposals at this time are strictly for the regular passenger service, not the Agawa Canyon Tour Train, which CN has continued to operate this season, but is entertaining offers/proposals for that service as well. The article mentions that it is unknown whether CN has received any interest for the tour train, but the benefits of the same operator running both the regular train and tour train are obvious, as the two services can share equipment and connect the services in other ways as well. (Until last year CN offered a combo package with the Tour of the Line where you could ride the Agawa Canyon Tour Train to Canyon park, enjoy the park for a while and get picked up by the northbound regular train to continue the Tour of the Line experience. When I rode the train to Hearst in 2013, I just rode the regular train as the Canyon train was sold out, but my friend that I travelled with, having booked earlier, was able to take advantage of this deal.)

Anyway, we’ll see what develops out of the proposals. Hopefully for all concerned it works out this time. While communities, private cottage and camp owners and tourist outfitters and resort/lodge owners have certainly hurt from the cessation of service, it’s worth remembering that whatever issues there were, RailMark also lost huge when they got forced out due to the lack of financing after operating for several months at a total loss. I think it’s in everyone’s best interest to have *all* the ducks in a row on this.