U.S. bankruptcy trustee hopes to allocate $25-million derailment policy allotted for victims next year
MONTREAL—The American bankruptcy trustee overseeing the insolvent railway involved in July’s deadly explosion in Lac-Megantic, Que., says he hopes to begin distributing “meaningful” compensation to victims in mid-2014.
Robert Keach said he hopes to allocate the $25-million derailment policy, allotted for victims, next year.
Additional funds could come from a second policy set mainly for service disruptions, claims against other companies and proceeds from the sale of Montreal, Maine & Atlantic (MMA) Railway.
Keach says the railway has attracted interest from about 20 interested buyers, including three that are eyeing only a portion of the railway network operating in Canada and the United States.
The trustee says he expects to disclose a lead bidder by Nov. 28 to set a floor price for other bidders.
A formal auction of qualified bidders would take place in December.
The railroad, whose runaway train killed 47 people in an explosion and fire, has closed on a US$3-million loan that will allow it to continue operations in both countries through its sale.
The loan has allowed MMA to rehire several employees to ensure that all trains are staffed with two-person crews, regardless of cargo.
The train with 72 oil tankers was left unattended by a solo crew member who was accused by the company of failing to set enough hand brakes.
Meanwhile, the U.S. bankruptcy court has approved the creation of a victims’ committee after the trustee withdrew his objections.
Keach says he is satisfied by limitations imposed by the judge that prevents the committee from having the power to investigate or litigate issues.