Watco

CBH class hauled train at Yilliminning, Western Australia in October 2013

Watco Santa Fe CF7 #5 at Pittsburg, Texas in August 2015

Watco was established in 1983 by Charles R. "Dick" Webb. The first operation was an industrial switching operation in DeRidder, Louisiana, that is still in existence. Webb then started his first mechanical operation, a railcar repair shop in Coffeyville, Kansas in 1985.

The Coffeyville mechanical shop was held captive to the major rail lines, and during discussions with the Union Pacific the opportunity arose to purchase the line running from Nevada, Missouri, to Coffeyville. This was the Union Pacific’s first short line sale. Watco then looked to the West Region, acquiring the Blue Mountain Railroad in 1998, the Palouse River and Coulee City Railroad in 1992 and the Eastern Idaho Railroad in 1993.

In 1998, they began operating the Stillwater Central Railroad in Oklahoma and the Timber Rock Railroad in Texas. The Kansas & Oklahoma Railroad was acquired in 2001 and the Pennsylvania Southwestern Railroad in 2003. In 2004, they started operations of the Great Northwest Railroad in Washington, the Kaw River in Kansas and Missouri, and the Mission Mountain Railroad in Montana. In 2005 they began operating the Alabama Southern Railroad, the Louisiana Southern Railroad, the Mississippi Southern Railroad, and the Yellowstone Valley Railroad in Montana. The Austin Western Railroad was started in 2007 and shares rail with passenger rail. They also acquired Millennium Rail, Inc., a mechanical service company in 2007. The Baton Rouge Southern and the Pacific Sun Railroad were started in 2008, and they also acquired the mechanical services company Fitzgerald Railcar Services, Inc., and Reload, Inc., a 25-year experienced transloading business. The Grand Elk Railroad began operations in 2009.

In December 2010 Watco entered the Australian rail haulage market when it was awarded a 10-year contract to operate grain services for the CBH Group of Western Australia.[1][2] Operations commenced in March 2012.[3][4] In late 2016 Watco Australia was awarded an infrastructure train contract with Brookfield Rail operating ballast and rail work trains.

On December 15, 2010, Kinder Morgan Energy Partners, announced an agreement whereby it would invest up to $150 million over the next year in Watco in exchange for a preferred equity position in the company. Kinder Morgan made an initial $50 million preferred shares investment on January 3, 2011.[5] Additional $50 million equity investment completed in December 2011.[6] Kinder Morgan will receive 3.25% quarterly distribution on the equity investment. Kinder Morgan is a leading pipeline transportation and energy storage company in North America. The transaction provides capital to Watco for further expansion of specific projects and offers Kinder Morgan the opportunity to share in the subsequent growth.

In April 2011, Watco began operating the Autauga Northern Railroad, between Maplesville and Autauga Creek, Alabama, the third short line in Alabama operated by Watco.[7]

On December 28, 2011 Watco began operations of the Swan Ranch Railroad[8] in the Swan Ranch Industrial Park in Cheyenne, Wyoming. On January 1, 2012, Watco gained majority ownership of the Wisconsin & Southern Railroad, a regional railroad in Wisconsin, and on February 1, 2012 took over operations of the Birmingham Southern Railroad.[9][10]

On June 4, 2014, Watco and The Greenbrier Companies announced that it would create an equally owned joint venture, GBW Railcar Services, providing railcar repair services.[11] This joint venture was dissolved in August 2018.[12]

• Official website