XPost: can.politics, ont.politics   
   From: ConsRCons@govt.cda   
      
   Reuters - Tue Aug 13, 2013   
      
      
   Canada to shut down rail firm involved in Quebec town disaster   
      
      
   OTTAWA (Reuters) - Canada will shut down the rail operator whose tanker   
   train blew up in a Quebec town last month, killing 47 people, because   
   the firm does not have enough insurance to pay clean-up costs and other   
   damages, a government regulator said on Tuesday.   
      
   The Canadian Transportation Agency said it would suspend the operating   
   license of Montreal, Maine and Atlantic Railway (MMA) and its Canadian   
   subsidiary from August 20, to give the two firms "time to arrange for   
   the orderly cessation of their operations in Canada."   
      
   MMA filed for bankruptcy protection in Canada and the United States last   
   week after the July 6 derailment and crash of the runaway train laden   
   with oil.  The resulting explosions obliterated the center of lakeside   
   Lac-Megantic, a small town in eastern Quebec close to the border with Maine.   
      
   In a court filing, the company said its insurance covered liabilities up   
   to C$25 million ($24.2 million), while clean-up costs could exceed C$200   
   million.   
      
   MMA also faces a series of class-action lawsuits in Quebec and in the   
   United States on behalf of the victims, as well as a notice of claim   
   from a firm that is unable to ship from its Lac-Megantic production   
   facilities.   
      
   An estimated 1.48 million U.S. gallons (5.6 million liters) of oil were   
   spilled in the crash.   
      
   The Canadian Transportation Agency - an independent government body that   
   oversees railway insurance - said it had contacted MMA and its Canadian   
   subsidiary to ensure they continued to hold adequate third-party   
   liability insurance.   
      
   But the agency was not satisfied with the response, said Geoff Hare,   
   CTA's chief executive officer.   
      
   "It would not be prudent, given the risks associated with rail   
   operations, to permit MMA and MMAC to continue to operate without   
   adequate insurance coverage," Hare said in a statement.   
      
   A spokeswoman for MMA Chairman Ed Burkhardt said he was unaware of the   
   agency's move.   
      
   The disaster - the worst of its kind in North America in two decades -   
   happened when the train started moving after it had been parked for the   
   night a few miles (km) outside Lac-Megantic. Burkhardt said last month   
   he doubted whether the engineer had set enough handbrakes after parking   
   the train.   
      
   Under federal regulations in Canada, there is no set minimum or maximum   
   amount of insurance coverage required for railway operators.  Coverage   
   is based on a risk assessment carried out by the insurance company and   
   the railway company.   
      
   The CTA said it would review the adequacy of third-party liability   
   coverage to deal with catastrophic events, especially for smaller railways.   
      
   MMA also has track in Maine, where it continues to operate, said Ted   
   Talbot, a spokesman for the U.S. state's transportation department.   
      
   Talbot, who noted that the U.S. federal government has jurisdiction over   
   interstate railroads, said Maine was working on a contingency plan in   
   the event that MMA ceases service unexpectedly.   
      
   Lac-Megantic, a town of around 6,000, was developed around the railway   
   and businesses have already expressed concern about the impact if the   
   MMA rail link closes permanently.   
      
   Town Mayor Colette Roy-Laroche was not immediately available for   
   comment, said a spokesman.   
      
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