In 1922 Pacific Gas and Electric Company (PG&E) built branches south from the McCloud main line at Bartle to build hydropower plants on the Pit River. Materials to build the Pit 1 powerhouse, the Pit 3 Dam, and the Pit 4 Dam were carried over the McCloud River Railroad to connection with the Pit River Railroad officially known as the Mount Shasta Corporation Construction Railroad. During this period, the McCloud Lumber Company, who owned the railroad, decided to build a branch Northeast to access the forests there. Meanwhile, the Great Northern and Western Pacific Railroads were building a North-South mainline, with plans to meet at Lookout, California. The McCloud decided to continue their lumber branch to serve as an interchange with the Great Northern and Western Pacific. The connection was made at Lookout Junction in 1927, although the connection of the GN and WP was actually made 6 miles south in Bieber, Ca. However, when the Great Depression hit, McCloud was desperate for money. So, they decided to sell the line from Lookout to Hambone to the GN. The McCloud retained operating rights until the Branch was abandoned in 2003. In 1955, McCloud extended the former PG&E line south to Burney, California. Upon reaching Burney, McCloud operated a railroad including trackage rights over the Great Northern Hambone branch.