Lunenburg, Massachusetts
    DIVISION 191 
  Brotherhood of Locomotive Engineers and Trainmen

Brotherhood of Locomotive Engineers and Trainmen

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News

Whats next for the local Pan Am Railways?

Posted by Matthew P. LaFrenier on January 2, 2015 at 8:45 AM

BUCKSPORT — Ever since its October announcement that it was selling the local paper mill, Verso Paper Corp. has been silent about what would happen to the 85-year-old facility. At least, it was until Monday evening, when news broke about the company’s agreement to sell the mill to AIM Development, a U.S. subsidiary of a Montreal metal recycler.

 

Much less news has been generated about the fate of another local asset: the Bangor-to-Bucksport railway that has carried paper production materials and finished paper into and out of the mill over the years.

 

 

 

 

Headquartered in Billerica, Mass., Pan Am Railways owns and operates the 20-mile-long, 10 miles-per-hour Bucksport line. Verso is currently its only client on the track.

 

Now that mill has closed, Pan Am Executive Vice President Cynthia Scarano says, the company is looking for new business on the Bucksport route, which passes through Orrington and Brewer on its way to the Bangor freight hub.

 

“We have no plans on closing the line. We’re working on some new customers and new development,” Scarano said. “[Verso] was a substantial customer. We’re trying to fill the void.”

 

Scarano said trains are still transporting supplies to and from the Verso facility this month, as mill workers help to clean up and mothball the facility. She’s spoken with several potential new clients on the route, but wouldn’t identify any of them.

 

Rep. Richard Campbell (R-Orrington), though, named two entities that are interested in Pan Am’s railway: the Penobscot Energy Recovery Center (PERC), a regional waste-to-energy facility in Orrington, and Mallinckrodt U.S. LLC, which is cleaning up chemicals spilled from former plants in Orrington.

 

Both may soon use the Pan Am rail to bring in and ship out waste, Campbell said. Unfortunately, he added, that means rail service won’t continue down to Bucksport until another manufacturer or industry moves in there.

 

While the Verso mill was operating, the train brought materials such as clay slurry and starch, leaving with coated paper.

 

Last year, Campbell, an engineer, proposed a bill in Augusta to study the diminished state of the rail bed between Brewer and Bucksport. What’s now needed are a set of new railroad ties, Campbell said.

 

Bucksport Economic Development Director David Milan testified at the hearing for that bill, explaining how water has diminished several stretches of track.

 

At the very moment Milan was testifying, he recalled learning later, a train car derailed along the Bucksport line.

 

In fact, several cars have derailed from Pan Am’s rail over the years, including one instance in 2012 when 4,000 gallons of a (reportedly non-hazardous) papermaking chemical known as kaolin spilled into the Penobscot River.

 

But Campbell’s bill proved unnecessary, the legislator said, because Pan Am committed to investing in the local rail if more industrial customers started using it.

 

At the time of publication, Scarano hadn’t responded to a request for confirmation of that commitment. But when interviewed earlier for this story, she said all track investments depend on “new businesses and what type of services they would require.”

 

It’s not just towns on the east side of the lower Penobscot that are now trying to make the manufacturing-rail logistics formula work.

 

Before Verso’s closure announcement, the federal government had awarded Eastern Maine Development Corp. (EMDC) of Bangor a $187,000 economic development grant to draft a regional response to the loss of major rail services and paper production businesses in northern Maine.

 

According to EMDC President Michael Aube, in light of Verso’s announcement, his group is now proposing to expand the scope of that project to include Hancock County. (EMDC has separately been facilitating assistance for the soon-to-be-laid off Verso workers.)

 

“That is clearly an asset, to and from a major industrial activity, that needs to be looked at,” Aube said of the Pan Am railway. “In terms of its value to the marketplace, it’s certainly something that once it’s gone, it’s hard to replace. My own personal view, in terms of economic development, is that you always look at preservation first and how you can increase or modify activity in way that makes sense.”

 

Plus, said Don Maier, associate dean of Maine Maritime Academy’s (MMA) Loeb-Sullivan School of International Business and Logistics, rail is a much more cost-effective shipping method than truck.

 

Several years ago, a group of students in the business program performed their own study for EMDC of a logistics route between Searsport and Bangor that would run essentially parallel — but also in coordination — with the Bucksport line. A deepwater port is located at Mack Point in Searsport.

 

One of the students involved in that 2012 study, Alaina Scheuchzer, is now an assistant professor at MMA. She explained that coordination between separate businesses also can be a boon for reducing shipping costs, since it can immediately create more volume for a rail freight service.

 

Just what volume will be coming out of Bucksport in the coming years is a big question mark, particularly with the declines in papermaking industry around the state and the recently announced purchase of the Verso mill by AIM Development.

 

“The loss of Bucksport is the loss of a major business for Pan Am, which isn’t good… Until the Verso closing, we were optimistic that volume would be increasing,” Campbell said.

 

“There’s a lot of potential here,” Campbell went on, pointing to other Bucksport assets like a deepwater port, power plant and easy access to multiple highways and municipalities.

 

It would be ideal if another manufacturer moved into Bucksport, he said, “but if not, were going to try to see what we can up with.”

 

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