OMNITRAX suspended service between Gillam and Churchill on Friday until further notice due to deteriorating rail conditions.
The company said in a news release the decision was made "due to severe permafrost issues and its effect on railway surface conditions.
"The safety of our employees and customers is our number-one priority and service will resume once the required track maintenance and surfacing has been completed."
Rail service has been suspended since a derailment on the Hudson Bay line June 2 just south of the Hudson Bay port, but officials initially said the service would resume within a week. No injuries were reported.
The decision to extend the rail suspension comes as Omnitrax Canada Inc. president Merv Tweed recently told the Nickel Belt News in Thompson plans to transport oil from The Pas to Churchill -- where it would be shipped to eastern North American and Western European markets -- have been put on hold.
"We probably aren't going to do it this year," Tweed said June 11. "We still have more consultation to do."
The ongoing railway disruption has opponents to transporting crude oil by rail in the north feeling both relieved and vindicated.
"This is what we already knew," said Eric Reder, a spokesman for the Wilderness Committee. "If they can't ship because of permafrost now, the same thing is going to happen when they have a tanker waiting to fill and they try and push a train through. There will be devastation. This rail line will always be what it is because of the terrain it runs across. We don't have the technology to get past that right now.
"We have to keep working on this. People had to know this rail line is as bad as we've said the last eight months," Reder added. "So for Omnitrax to come out and say we can't ship crude oil (for now) is a big deal."
A spokesman for Omnitrax could not be reached Friday night. The railway had planned to begin shipping light crude to the Port of Churchill in August, a test run that could eventually result in 3.3 million barrels transported annually. Environmental groups and First Nations opposed the plan.
In January, Omnitrax president and COO Darcy Brede told the Free Press the company had plans to set up oil booms around each tanker in case of a spill. Omnitrax was also working with a B.C. firm that has experience transporting oil in the Arctic.
Reached Friday night, Churchill Mayor Michael Spence refused to address the transportation of crude oil specifically.
"There's some issues that have occurred and people have some concerns," Spence said.
"We just want service back on. We don't know the extent of how long it will be. I just want rail service. If they move oil or not, I'm not sure if that will ever happen. Maybe it won't."
Churchill resident and businessman John Hrominchuk also opposed the transportation of crude oil, especially after the disaster last summer in Lac-Mégantic, Que. As owner of the Bear Country Inn that hosts tourists who would soon be coming to Churchill to see whales and polar bears, Hrominchuk is also concerned about the impact of rail service disruption on the local economy.
"I'm not happy with what's happening," Hrominchuk said. "But we have to be concerned about public safety."