As part of the negotiations leading up to the CPKC+Parsons Vale Trust merger, the Trust offered a sweetener to British Columbia in the form of proposing to take over operating rights on the Island Corridor Foundation’s exx-Esquimalt & Nanaimo Railway.
BC Transit, which had been writing proposals to use the E&N for passenger operations, was very enthusiastic about this idea, as was the Island Corridor Foundation, and, to a lesser extent, SRY Rail Link (which still had terminal operations in Nanaimo and needed to be bought out before assenting to the transfer), so they hinted to the province that they (particularly SRY Rail Link) would not contest the merger if this deal was included.
Post-merger, the operating rights were transferred to a new GFM subsidiary (which turned out to be the actual Esquimalt & Nanaimo Railway, which the CPR had kept stored as a dormant property in their Calgary HQ) and track crews were dispatched to the island to start the l-o-n-g process of rehabilitating the E&N’s east coast main line between Victoria & Courtenay.
The rehabilitation project is being done with road & high rail vehicles (the formation had 15 years to decay, and a couple of exploratory trips away from the active trackage in Nanaimo were terrifying enough so the E&N decided that it was safer to do the first pass with road vehicles.
The terminal operations in Nanaimo are small-scale enough so that they don’t require much power to operate; a pair of CBR’s eco-418 locomotives (displaced from the CBR when container trains started on Cape Breton Island and needed bigger power than these small road switchers) are now stationed in Nanaimo switching the ferry terminal, the single industry (Superior Propane), and the occasional pick up and delivery to the team tracks in Nanaimo yard.
The E&N is guessing that they will have the line operable in 2028 or late 2027, so they’ve hired sales agents who are driving up and down Vancouver Island trying to coax industry back onto the railroad.