September 19, 2017

Canadian government steps in to reopen Hudson Bay line

Written by  Mischa Wanek-Libman
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THE Canadian government has appointed a negotiator and says it is willing to explore interim funding options or the potential sale of the Hudson Bay Railway to Churchill in order to reopen the line as soon as possible following major flood damage.


The line between Amery and Churchill has been inoperable since May 23 due to a 200-year flood event that will cost between $C 20m ($US 16.3m) and $C 60m to repair. OmniTrax, which owns the Hudson Bay Railway, said in July that the track bed has been washed away in 19 locations, five bridges are damaged, and an additional 30 bridges and 600 culverts will need to be further assessed for structural integrity. Mr Peter Touesnard, ‎chief commercial officer with OmniTrax, described the damage as “unprecedented and catastrophic” when he announced an indefinite suspension of rail services.

Earlier this month, the government formally demanded that the Hudson Bay Railway Company honour a 2008 agreement and repair the tracks.

Mr Wayne Wouters, strategic and policy advisor with McCarthy Tétrault, has been named as the government’s chief negotiator to represent Canada’s interests. Wouters will play a role in the discussions with OmniTrax, interested buyers, community leaders, and the Province of Manitoba.

The government says it is “deeply concerned that OmniTrax has not yet commenced repairs and that further delay may jeopardise the ability to complete repairs before winter.”

The government says it will look into transferring ownership of the line (and work with the new owner to restore rail service) should OmniTrax not be able to make the needed repairs and providing that the following conditions are met:
• the assets are transferred at a reasonable price taking into account OmniTrax’s obligations
• the new owner has support from First Nations and other communities along the route, and
• the new owner has a viable business plan to operate the rail line safely, reliably and cost-effectively.

The government says it is willing to explore interim funding to restore the rail service, provided progress is made on meeting these conditions.

“The government of Canada remains committed to the people of Churchill and Northern Manitoba and is ready to do its part to restore rail service,” says Canada’s minister of natural resources Mr Jim Carr. “Time is of the essence here, and quick action from all partners is needed now.”

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