The St. Clair Tunnel Company opened the first tunnel in 1891. The company was a subsidiary of the Grand Trunk Railway(GTR), which used the new route to connect with its subsidiary Grand Trunk Western Railroad (GTWR). Before the tunnel's construction, the GTR was forced to use time-consuming rail ferries to transfer cargo.
The tunnel was an engineering marvel in its day, achieved through the development of original techniques for excavating in a compressed air environment. Freight trains used the tunnel initially with the first passenger trains using it in 1892.
The tunnel measured from portal to portal. The actual width of the St. Clair River at this crossing is only . The tube had a diameter of 19 feet, 10 inches (6.05 m) and hosted a single standard gauge track. It was built at a cost of $2.7 million.
Steam locomotives were used in the early years to pull trains through the tunnel, however concerns about the potential dangers of suffocation should a train stall in the tunnel led to the installation of catenary wires for electric-powered locomotives by 1907. The first use of electric locomotives through the tunnel in regular service occurred on May 17 1908.
In 1923, the GTR was nationalized by Canada's federal government, which then merged the bankrupt railway into the recently-formed Canadian National Railways. CNR also assumed control of the GTWR and the tunnel company and continued operations much as before.
The electric-powered locomotives were retired in 1958 and scrapped in 1959 after CNR retired and scrapped its last steam-powered locomotives on trains passing through the tunnel. New diesel-powered locomotives didn't cause the same problems with air quality in this relatively short tunnel.
After the Second World War, railways in North America started to see the dimensions of freight cars increase. CN (name/acronym change in 1960) was forced to rely upon rail ferries to carry freight cars, such as hicube boxcars, automobile carriers, certain intermodal cars and chemical tankers, which exceeded the limits of the tunnel's dimensions.
The tunnel was designated a Civil Engineering Landmark by both the Canadian and the American Societies of Civil Engineers (CSCE and ASCE) in 1991.
The tunnel was declared a U.S. National Historic Landmark in 1993.
By the early 1990s, CN had commissioned engineering studies for a replacement tunnel to be built adjacent to the existing St. Clair River tunnel. In 1992, new CN president Paul Tellier foresaw that CN would increase its traffic in the Toronto-Chicago corridor. The Canada-U.S. Free Trade Agreement was implemented in 1989 and discussions for a North American Free Trade Agreement between Canada, the United States and Mexico discussions were underway at that time (NAFTA was implemented in 1994). It was only logical that import/export traffic on CN's corridor would increase dramatically.
In 1993 CN began construction of the newer and larger tunnel. Tellier declared at the ceremonies:
"[the] tunnel will give CN the efficiencies it needs to become a strong competitive force in North American transportation"
This tunnel was not hand dug from both ends like the first. A machine called the Excalibore made by the Lovat Tunnel Equipment Inc was used. It started on the Canadian side and made its way to the US.
The tunnel opened later in 1994 whereby freight and passenger trains stopped using the adjacent original tunnel, whose bore was sealed. The new tunnel was dedicated on May 5, 1995 and measures from portal to portal with a bore diameter of 27 feet, 6 inches (8.4 m) with a single standard gauge track. It could accommodate all freight cars currently in service in North America, thus the rail ferries were also retired in 1994 at the time of the tunnel's completion and opening for service.
On November 30, 2004, CN announced that the new St. Clair River tunnel would be named the Paul M. Tellier Tunnel in honour of the company's retired president, Paul Tellier, who foresaw the impact the tunnel would have on CN's eastern freight corridor. A sign now hangs over each tunnel portal with this name.