First it was an Airbus A310 that they were flying and not a tristar L-1011. Air transat does not have any active L1011's in their fleet. So there is no flight engineer.
It appears that they flew into some wind sheer, dropped from 3000 ft to 1300 ft which caused a loss of altitude and airspeed indications. They then asked for their ground speed and altitude from the controller and then climbed to 6000 ft. After climbing, they restored the instruments and were transfered to Montreal Centre.