The Canada Transportation Agency has allowed the Montreal, Maine & Atlantic Railway (MMAR) to operate until 1 February 2014, following a major accident at Lac-MÃ©gantic in Quebec in July.
The MMAR’s certificate of fitness was suspended after the accident, which involved a goods-laden train, and has been under review in regards to insurance coverage and the nature of its operations.
The accident occurred on 7 July when an unattended train carrying crude oil derailed resulting in an explosion, which killed 40 people and caused widespread damage to the town.
The suspension of the certificate was set to be effective from 18 October but has been deferred until 1 February 2014 after the agency considered three parameters: MMAR’s self-insured retention amount, its third-party insurance coverage and the nature of the operations planned during the period.
The agency said that MMAR has a self-insured retention amount of $250,000 and third-party liability insurance coverage of $25,000,000 for any one occurrence and in the aggregate.
MMAR has secured funds for its insurance until February 2014.
The Canada Transportation Agency has compared the risks involved in the continued operations of MMAR with that of the time immediately following the accident, and found that overall traffic will decrease by over 70% and that of dangerous goods by over 80%.
The Canada Transportation Agency said: “The volume of dangerous goods is expected to decline as a percentage of overall volume in the post-accident period, projected to represent approximately 30% of MMAR’s total traffic, a decrease from the pre-accident level of 50%.”
MMAR will discontinue the transportation of crude oil during the period of the extension as well as reduce the distance of transit of dangerous goods by 90%.
The company’s rail network will be opened for a tourist train to be run by Orford Express, by which MMAR is additionally insured under third party liability insurance policy.