Plot
Thomas the Tank Engine wins a race against Bertie the Bus, who mentions that a new branch line is being built. This concerns Annie and Clarabel, who fear that Thomas' branch line may be closed down. The next morning, Thomas plays a prank on Gordon the Big Engine for teasing him, which causes a major derailment. As punishment, Sir Topham Hatt reassigns Thomas to assist in constructing the new branch line while the new tank engine Ryan is granted Thomas' job in the meantime.
At the construction site, part of the terrain subsides underneath the new track. Thomas misses the caution signs and confuses the workers' shouting for a welcome. He soon falls into a cavern where he finds a pirate ship. He attempts telling Sir Topham Hatt about the ship, but Hatt brushes off Thomas's protests as excuses. Rocky the crane is instead credited with discovering the ship, which is displayed at Arlesburgh Harbour.
The next day, a partially-repaired Thomas remains at the construction site, much to his dismay, now alongside Ryan, and feels he is no longer Hatt's "number 1 engine". That night, Thomas meets Sailor John and his boat Skiff, the latter of whom has been fitted with wheels that allow him to travel on rails. John says he is looking for treasure but is hesitant to give Thomas details. The next day, a jealous Thomas neglects to tell Ryan about a faulty coal hopper he used previously, which leads to Ryan's trucks full of dynamite igniting by accident. Thomas saves Ryan and disposes of the dynamite, but Hatt is furious at Thomas for the destruction. Thomas is unable to explain the truth and Hatt confines him to his shed for the rest of the afternoon. Later, John and Skiff ask Thomas for assistance searching for the treasure, but when morning comes and the map provides no results, John becomes suspicious of Thomas.
Marion the steam shovel finds the treasure chest John was searching for, which Hatt keeps in his safe overnight, intending to donate it to the museum. Thomas later meets a furious John, who demands the treasure. Thomas says that Hatt has the treasure and refuses to help John take it. Later, Ryan thanks Thomas for saving him. Thomas reveals and apologizes for his role in the accident, turning down his shed space to stakeout at Knapford in case John returns. John breaks into Hatt's office and steals the treasure, using Skiff and the pirate ship as his getaway. Thomas chases them through a junction where the minimum-gauge engines slow the ship by derailing their ballast trucks. A loose rope is caught on Ryan, who derails the flatbed carrying the ship, leaving John with only Skiff and the treasure.
At Arlesburgh Harbour, Thomas attempts to knock Skiff off of the rails to no avail. At the launch ramp, John rows Skiff out towards the sea, and Thomas ends up partially submerged and fully immobilised. Skiff knocks Sailor John and the treasure off of him; the treasure sinks to the bottom of the harbour, and Sailor John is soon arrested by the police. Thomas is rescued and attempts to apologize to Hatt, fearing he will still be cross with him. Instead, Hatt is proud of Thomas, as Ryan explained everything to him, and assures Thomas that he will always be his "number 1 engine", thus finally reconciling.
When the branch line is completed, Sir Topham Hatt, who entrusts the new line to Daisy the diesel railcar, returns a fully-repaired Thomas to his branch line, and lets him cut the ribbon to the new line. Free from Sailor John, Skiff begins giving tours around Arlesburgh Harbour, and the treasure is recovered from the ocean.
