There was discussion a couple months ago about what FEF-3 used as fuel.
The answer was coal. This means that to fuel your FEF-3 you need to go to an (active) coal tower and that it will not work in a diesel oil refuel point.
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Smokebox has managed all that, thanks to its advanced scripting.
However when you talk about the Challenger or other steam locomotives that have oil tenders in TS2016, those are only visual (and sometimes audio) goodies that enrich the game, but you still open the firebox and press R to shovel coal.
Oil burning was never available in MSTS either, another proof that the full steam core was imported from there by Kuju, with very few modifications.
