Lake Megantic Quebec - A Canadian railroad is withdrawing its objection to a $338 million fund for victims of an oil train derailment that killed 47 people in a small town in Quebec, removing the final obstacle to the settlement's final approval.
 
A Canadian judge gave conditional approval Thursday to changes to the settlement agreement that grant some legal protections to Canadian Pacific, allowing it to lift its objection.
 
The judge gave lawyers for victims and the province of Quebec until Tuesday to confirm their support of the changes, but that wasn't expected to delay final approval by a U.S. bankruptcy judge Friday in Portland, said Robert Keach, the U.S. bankruptcy trustee in the case.
 
Barring any eleventh-hour surprises, final approval would allow payments to be made to victims of the disaster by year's end, Keach said Thursday.
 
About $83 million is being set aside to settle wrongful death claims.
 
"We're very happy for the victims that we were able to get to this point. They're the primary focus here. We're pleased and humbled that we're going to be able to make a distribution by the end of the year. The people deserve it. It's been a long time coming," he said.
 
Much of downtown Lake Megantic was destroyed when the runaway train with 72 oil tankers derailed on 6 Jul 2013 setting off powerful explosions.
 
The train's operator, Montreal Maine & Atlantic (MMA), filed for bankruptcy in the United States and Canada, and the settlement fund is tied to proceedings in both countries.
 
The fund, worth $446 million in Canadian dollars, was the product of negotiations with about two dozen companies with potential liability.
 
Canadian Pacific owned track where the crude oil shipment originated and was the only company with potential liability that declined to participate in the settlement.
 
Canadian Pacific contended it bore no responsibility since the train that derailed had a MMA locomotive and crew and was operating on MMA rail.
 
But Keach argued Canadian Pacific bore some responsibility for failing to properly classify the Bakken region crude oil, which was as volatile as gasoline.
 
Canadian Pacific isn't contributing to the settlement fund, and the railroad had contended the plan would have hampered its ability to defend itself from lawsuits, because the agreement provided legal immunity to companies that do contribute.
 
But the altered amendment calls for a "judgment reduction provision" that would take into account the full settlement paid by others if CP is ordered to pay damages in the future.
 
"Although CP was not at fault in the derailment, we have been working with the trustee for a solution that protects CP interests and allows payments to be made to victims as soon as possible," said spokesman Martin Cej.
 
David Sharp.