Last week, the STB issued a decision denying the Kansas & Oklahoma Railroad’s petition to exempt its lease renewal with Union Pacific. This is a big win for rail industry growth and the latest attempt by the STB to contend with paper barriers in shortline lease agreements.
The K&O RR is one of Watco’s largest railroads that stretches across most of Kansas and interchanges with BNSF and UP at multiple points. It’s a descendant of branch lines from the former Atchison, Topeka, & Santa FE and Missouri Pacific railroads. In 1993, OmniTRAX created the Central Kansas Railway from the AT&SF branch lines. Another OmniTRAX property, the Kansas Southwestern Railway which leased former MoPac lines from UP, was later rolled into the CKR. Watco purchased the CKR in 2001 and renamed it the K&O.