The S&L, along with other assets of the corporate successor to DOMCO, Dominion Steel and Coal Corporation (DOSCO), were expropriated by the Cape Breton Development Corporation (DEVCO) on March 30, 1968. DEVCO operated the railway as an unincorporated department of its Coal Division, however it was informally known as the Devco Railway. DEVCO built a coal preparation and coal wash plant and storage facility, along with new locomotive shops at Victoria Junction, a location midway between Sydney and the Lingan Generating Station near New Waterford.