Lac-Megantic still appealing to railway to pay for cleanup costs

The town of Lac-Megantic says the cost of cleaning up its disaster zone has skyrocketed to almost $8 million and it wants the railway involved to pay up.

The town of Lac-Megantic says the cost of cleaning up its disaster zone has skyrocketed to almost $8 million and it wants the railway involved to pay up.

The town mayor says the cleanup costs are now nearly double the previously reported figure.

Without the help of the provincial government, she says, Lac-Megantic would be stuck.

Colette Roy-Laroche says her town has sent a second legal notice to the Montreal, Maine & Atlantic Railway demanding payment for the $7.8 million in cleanup costs.

It wants a response within 24 hours. This is after the railway missed a deadline last week to respond to the first legal letter.

“The town of Lac-Megantic is still appealing to the company’s sense of responsibility,” Roy-Laroche said.

The town is, at the same time, speaking to lawyers about a possible lawsuit. Several other lawsuits are already being organized in the wake of the disaster.

MMA has hinted that it might have to shut down.

“Everyone’s envisioning that (bankruptcy) scenario, I guess,” Roy-Laroche said. “But I don’t have any more information on that.”

Another U.S. company says it has serious objections to a legal request that it help pay for the cleanup.

World Fuel Services Corp. is one of three companies that received a Quebec government legal notice Monday demanding that they pick up the tab for the devastating July 6 derailment, which released millions of litres of crude oil into the surrounding environment.

The petroleum-logistics firm was named in the order alongside its subsidiary, Western Petroleum Company, and the MMA Railway, which operated the train that slammed into the community, killing an estimated 47 people.

“We have serious objections to the legality of the order,” World Fuel Services said in a statement Tuesday.

“We intend to promptly discuss these issues with the relevant authorities.”

World Fuel Services, which is based in Miami, said it did not expect to be named in the legal notice, or in any similar government action related to the crash involving a crude-oil-filled train. The company added it has sent its own environmental experts to monitor the progress of the cleanup efforts as much as possible, but says the site remains under control of MMA and local officials.

It said Monday’s order is the first time the Quebec government has stated that World Fuel Services has any responsibility to pay for or supervise cleanup activities by crews it maintains are under control of MMA and local authorities.

“World Fuel Services will continue to meet any and all obligations it may have with respect to the accident,” the statement said.

“We realize this has been a great tragedy for the local community, and we want to again express our deepest sympathies and condolences to the victims, the families, and all those who have been affected by this tragic accident.”

The Quebec legal order is one element on the growing stack of legal problems for companies connected to the derailment.

World Fuel Services, Western Petroleum Company and MMA are among 10 defendants listed in several wrongful-death lawsuits filed last week in an Illinois court. Both World Fuel Services and MMA have also been named in a proposed class-action suit in Quebec.

The railway declined to comment Tuesday on the Quebec government’s legal order or any other legal questions.

The Maine-based company was expected to respond Tuesday to a lawyer’s letter it received last week from the municipality of Lac-Megantic.

The municipality’s legal notice calls on MMA to reimburse the municipality $4 million after the railway allegedly failed to pay cleanup crews. The town and the province assumed the cost when workers hired by the railway threatened to walk off the job if they weren’t paid.

Amid MMA’s intensifying financial headaches, its chairman recently told a Maine newspaper that he was considering whether the railway could survive.

On Tuesday, MMA was said to have laid off five more employees.

The United Steelworkers, which represents MMA workers in Quebec, indicated the company has now cut nearly one-third of its workforce in the province since the derailment.

It said Tuesday’s layoffs of five Farnham-based MMA employees means 24 of the railway’s 75 workers in Quebec have lost their jobs.

The railway let go 19 Quebec workers earlier this month, citing the disaster’s impact on the business.

– With a file from Melanie Marquis