Rail upgrade to Fort McMurray almost complete
David Finlayson, edmontonjournal.com
September 30, 2008
EDMONTON - The $135 million upgrade of the former Athabasca Northern rail line to Fort McMurray is 75 per cent complete and CN has commitments from oilsands customers to ship sulphur and petroleum coke to Asia, executive vice-president Jim Foote said today.
Coming the other way will be construction materials and diluent, a petroleum product used to thin out bitumen so it can to move through pipelines, Foote said.
"We see the oilsands area as a great opportunity to grow our business," Foote told the chamber of commerce luncheon.
The upgrade of the 300-kilometre length line that CN bought back from Athabasca Northern for $35 million early this year will increase train speed from an average of 10 miles an hour to 25 miles per hour and allow heavier loads, Foote said.
The line from Boyle, 150 kilometres north of Edmonton, crosses unstable muskeg over 35 per cent of its length, and needed improved rails, ties, bridges and ballast after years of neglect.
It currently ends just south of Fort McMurray and Foote said CN would be prepared to look at a partnership to build a new road and rail bridge across the Athabasca River to connect with the oilsands projects to the north.
He also said delays to several bitumen upgrader projects planned for north of Edmonton in so-called Upgrader Alley won't affect the $50 million to $70 million upgrade of the portion of line from Edmonton to Boyle that includes service to the Fort Hills upgrader.
"It doesn't change our plan. The oilsands will be developed, and the upgraders will go ahead at some point, whether here or somewhere else."
This year's $430-million Western Canadian spending program also included improving the line between Edmonton and Prince Rupert, where CN opened a container port a year ago to take goods from Asia to Eastern Canada, and the U.S. through Chicago.
Foote said the U.S. housing slowdown meant Prince Rupert container traffic didn't grow as fast as expected, but is now up to speed at 65 per cent of the terminal's capacity.
That translates to 10 to 12 trains a week, compared with two trains prior to the new port's construction.
Two giant container ships a week now visit Prince Rupert, which is two days closer to key Asian centres than any other West Coast Northern American port.
But the ships still have to visit other ports to fill up with products going the other way.
Foote said CN is working hard to make sure more than the current 30 per cent of containers go back to Prince Rupert full.
They opened a $20 million centre in Prince George to put forest products into containers, and three years ago built a centre in Edmonton which tips the containers on end and pours grain into them, he said.
"We don't have a crystal ball, but so many people have great ideas. If you had told me three or four years ago we would be shipping diluent into the oilsands in containers we built, and shipping ethanol back to Asia for animal feed, I'd have said you were crazy."
dfinlayson@thejournal.canwest.com
© Edmonton Journal 2008
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