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Rail News: Rail Industry Trends

STB blesses NS/Pan Am Railways 'Patriot Corridor' joint venture


Yesterday, the Surface Transportation Board (STB) announced it approved the joint control and ownership of Pan Am Southern L.L.C. (PAS) by Norfolk Southern Railway, Pan Am Railways Inc. (PAR), and Pan Am subsidiaries the Boston and Maine Corp. and Springfield Terminal Railway Co.

The board — which imposed labor-protection and environmental conditions on the deal — determined that the “end-to-end” transaction and related operational agreements would produce “substantial transportation benefits” to the New England region.

“The transaction will not result in a substantial lessening of competition, the creation of a monopoly, or a restraint of trade in freight surface transportation in any region of the United States,” STB officials said in their decision, adding that an upgraded east-west mainline route would significantly increase competition.

PAS will operate about 437 miles of track, including an east-west Patriot Corridor between points in New York and Massachusetts, and a north-south section between Vermont and Connecticut. NS plans to invest $87.5 million in PAS for infrastructure upgrades to improve traffic flows and expand capacity.

In May 2008, NS and PAR announced plans to form joint venture Pan Am Southern and establish the Patriot Corridor, a 155-mile high-speed freight-rail route between Mechanicville and Ayer, Mass. The corridor will include 281 miles of PAR's secondary and branch lines, including trackage rights, in Connecticut, Massachusetts, New Hampshire, New York and Vermont.