Canadian Manufacturing

Manitoba pleads for Fed help to sustain crucial Churchill rail line and port

The rail line is the only land link to Churchill and the port is Canada's only deep-water northern port



Two companies owned by Omnitrax—Hudson Bay Railway and Hudson Bay Port Co.—are hoping to ship crude oil by rail through the Port of Churchill, Canada's only Arctic deep-water seaport. PHOTO Omnitrax

Port of Churchill owner OmniTrax may discontinue service if no buyer is found. PHOTO Omnitrax

WINNIPEG—The Manitoba government is looking for federal help to ensure the continued operation of a northern rail line and port being put up for sale by OmniTrax Canada.

Manitoba Transportation Minister Steve Ashton discussed the issue Dec. 2 with federal counterpart Marc Garneau.

“It’s quite legitimate to look at developing a business plan that works,” Ashton said from Ottawa following the meeting.

“If it can grow the scope of its business, that’s the key to its long-term future. That’s very much the focus which we’re going to follow through with the federal government.”

Denver-based OmniTrax took over the Port of Churchill and the Hudson Bay rail line in 1997. The line is the only land link to Churchill and three other communities from the south. The port is Canada’s only deep-water northern port and relies heavily on grain shipments from western farmers.

But those grain shipments were less than half the normal 500,000 tonnes this year, said Churchill Mayor Mike Spence, and OmniTrax has decided to seek offers for new ownership.

“The real challenge is the service to the communities in the North,” Omnitrax Canada president Merv Tweed said.

“The grain and the railway can do reasonably well, but to provide the service to the communities along the railway line, there just has to be a different approach to it and a different plan. And we think by offering it up (for sale), that plan may come forward.”

Tweed said OmniTrax may discontinue service if no new buyer is found. He also suggested governments could have the railway operate as a utility, presumably with regulation of rates and some form of subsidy in poor years.

Ashton suggested the long-term survival of the port and railway could depend on expanding port storage facilities to handle potash and other goods.

The northern rail line, which crosses hundreds of kilometres of bog and permafrost, has been plagued by derailments that have intermittently forced the suspension of both freight and passenger services.

Figures from the Transportation Safety Board of Canada show there were 63 accidents on the line between 2003 and 2012. All but 10 were derailments.

OmniTrax had thought of shipping crude oil along the railway, but backed off the plan last year. The proposal was opposed by aboriginal groups, environmentalists and the government of Manitoba.

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