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Following bankruptcy protection, who will pay for Lac-Megantic clean up?

The Quebec government issued a legal notice demanding that two U.S. petroleum firms and the railway involved in the Lac-Megantic crash foot the entire bill to clean up and restore the local environment. THE CANADIAN PRESS/Ryan Remiorz
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The Quebec government issued a legal notice demanding that two U.S. petroleum firms and the railway involved in the Lac-Megantic crash foot the entire bill to clean up and restore the local environment. THE CANADIAN PRESS/Ryan Remiorz . THE CANADIAN PRESS/Ryan Remiorz

The decision from Quebec’s superior court was swift. But despite a Quebec Superior Court justice granting creditor protection to the railroad at the centre of the tragic Lac-Megantic disaster, it doesn’t mean the town will be on the hook for the cleanup.

Officials on provincial and federal levels vowed Thursday to make Montreal, Maine & Atlantic pay for the damage.

Quebec has registered as a “guaranteed collector,” Health Minister Réjean Hebert said, meaning the province could be able to collect payments from the railroad before other claimants.

“We registered as a guaranteed creditor first, in order to get back money from MM&A and get back money from the insurers,” Hebert told Global News Thursday. “We will do all the legal procedure needed to get back the money.”

Prior to Montreal, Maine & Atlantic’s bankruptcy-protection filing, the governments of Canada and Quebec were pressuring the company to foot the cleanup bill that has already reached close to $8 million. MM&A has estimated the costs could climb to $200 million.

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On the heels of the Quebec court’s decision, federal Transport Minister Lisa Raitt said MM&A cannot walk away from Lac-Megantic.

“This announcement does not mean that MM&A is off the hook for their responsibilities to the people of Lac-Megantic,” she wrote in an emailed statement. “We will work with the province of Quebec to ensure that the clean-up continues and that the people of Lac-Megantic continue to receive the support they need.”

Ottawa has already announced $60 million to help with the recovery efforts.

The Quebec judge has given MM&A no more than 30 days to come back with a proposal on how it plans to deal with its liabilities and how it plans to disburse funds to its creditors – but there isn’t very much money to go around.

According to court documents, MM&A has just $18 million in assets in Canada, with another $50 million to $100 million in the United States.

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