NEWS PHOTO COLLIN GALLANT Alison Field, with the Western Canadian Short Line Railway Assocaition, addresses delegates to the Local to Global Trade Conference in Medicine Hat on March 7. Her group has hopes of securing transportation corridor funding support in this week's federal budget.
cgallant@medicinehatnews.com@CollinGallant
Three independent rail projects in southeast Alberta are boasting big news in 2019 – at the same time their lobbying association is arguing for new support in today’s federal budget.
New freight contracts for Forty Mile Rail, a logistics yard in Oyen and a propane hauling contract for the Great Sandhills line were held up at this month’s Local to Global trade conference in Medicine Hat.
That’s all “gravy on top of grain” for the rail lines that were originally organized by local shareholders to move agricultural goods.
Now, side operations – construction laydown, material and petroleum handling and railcar storage – are proving the long-advertised goal of regional rural development is attainable with rail access, say advocates.
“If we didn’t have agriculture, we wouldn’t exist – oil and energy is great, but grain (underpins the business),” said Alison Field, governmental relations director with the Western Canadian Short Line Railway Association.
However, adding business and hauling on top of that base means “a lot of our short lines have opportunities for growth and investment.”
Her group represents 26 short lines, mostly in Saskatchewan in a concerted effort since 2000 to take over lines scheduled to be abandoned, but also three in Alberta.
She’s always promoted local groups taking over lines rather than seeing the rails pulled up, but now she says local governments, co-ops and businesses should evaluate how to build new spur lines and transload yards.
The group also requested during pre-federal budget consultations last fall, $90 million in funding from the national transportation corridor fund over three years.
About one-third would go toward building 30 new sidings for its operators. Better networks are a way to tackle perennial complaints of grain backlogs, but also help with arranging longer trains to flow into major railroad operations. That helps independents broker access and fees with Class 1 railroads.
It could also create development hubs, make nearby land more attractive for industrial customers, and working, help operators earn more with two-way traffic, not just hauling grain or oil out.
The end goal is to emulate the American short line sector, said Field, which is about 10 times larger, benefiting from a larger track network and tax breaks for short line investment.
“Along these (U.S.) lines, it’s business after business after business,” she said.
“It’s no small feat to run a railway,” but it’s better to take one over, she said
The Forty Mile Rail company purchased its line for near iron scrap value of about $4 million four years ago, but estimates to build a new 75 mile line run more than $100 million.
“If there’s a railroad in your area you should buy it,” said conference attendee Lorne Buis, a 40-Mile shareholder and also the mayor of Foremost.
There’s encouraging news in the sector.
This year, Forty Mile Rail, which connects Foremost to the Canadian Pacific mainline south of Lethbridge, will haul in massive wind turbines for Capital Power Whitla windfarm, south of Bow Island.
Similarly, a logistics park in Oyen that opened in late 2017 as a CN-serviced terminus and drilling sand terminal will bring in turbines for the Sharp Hills Wind Farm.
The longest-serving short line in the region, the Great Sandhills line the is based in Leader, Sask., will gain a propane hauling contract in 2021. At that time Pembina Pipeline plans to complete an extraction facility at its Alberta straddle-plant complex.
That rail line, said Field, is a good example of the localized boost short lines can provide to a town like Leader, Sask., where four employees are now based. It hauls for 50 producers, as opposed to two elevators previously, for over the 10 years of independent operation.
“The majority of short lines are producer groups, and there’s a big switch in mindset required – they’re very different,” said Field. “It’s not like driving a tractor.”
