Omnitrax won’t fix rail line to Churchill

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This article was published 18/07/2017 (3015 days ago), so information in it may no longer be current.

Omnitrax estimates it will cost between $20 million to $60 million to repair the severely damaged track on the Hudson Bay Railway between Gilliam and Churchill, but it’s looking for someone else — such as the federal and provincial governments — to pay for it.

At a lengthy news conference Tuesday morning, Ron Mitchell, a rail expert with AECOM Canada, said extensive repairs are required along the 292-kilometre stretch of track.

Omnitrax retained AECOM on June 1 to produce a detailed assessment of the rail line damage due to flooding. And although AECOM’s final report will not be completed until Aug. 1, Mitchell said the repair work could be done in 60 days.

Mitchell and five Omnitrax officials, including Denver-based Peter Touesnard, the company’s chief commercial officer, set out a detailed schedule showing if work starts on the rail line at the beginning of September, it could be completed before freezeup.

But Touesnard said the repairs have not begun because the company is not prepared to spend the money to do it.

“The challenge we have today, faced with millions of dollars of damage to this rail line, is we cannot justify spending the resources to repair this line,” Touesnard said. “We want to work with the public and the community to repair the line, but we cannot justify spending the money. It is not economically viable.”

Omnitrax Technical Briefing

Severe snowstorms in March and unseasonably high temperatures in late May created what Mitchell called a once-in-200-year-flooding situation in a section of the rail line between Gillam and Churchill.

It left long stretches of the track under several feet of water, bridges severely compromised and ballast swept away from where it was supposed to support the track along many portions of the line.

Rail service was shut down on May 24, cutting off ground transportation in and out of Churchill, a town of 900 people that has built up a thriving eco-tourism industry based around polar bear- and beluga whale-watching excursions. 

A year ago, the town’s port also closed and grain shipments were cancelled, forcing close to 100 layoffs.

Officials said the remoteness and inaccessibility of materials will make repairing the line challenging and expensive, though doable. Rock and ballast will have to be brought in from Thompson, effectively a one-day trip each way.

Mitchell said even camp cars needed to house the 25 to 30 repair workers will be hard to access because rail companies across North America have not used them for years.

Touesnard reiterated the point Omnitrax has been making since 2015, when it announced it wanted to sell the line: the Hudson Bay Railway should be treated as a public utility and the public sector should be funding it.

“It has been a very challenging operation since we purchased it in 1997,” he said. “In 2015, we sat down with the province and First Nation leaders and had a discussion about the importance of the rail line to the community of Churchill.

“We see it as an essential service. I really believe it is a public utility because it is not commercially viable.”

He said the company continues to reach out to the federal and provincial governments for support. But with only weeks left before contracts need to be tendered in order for the work to be completed this year, there is still no plan in place.

Manitoba Premier Brian Pallister has said that he will make no commitments until he knows the total cost of repairs.

Touesnard said he hopes to discuss a potential takeover of the rail line with the province now that Omnitrax has a better idea of how much repairs will cost.

“It has been a very challenging operation since we purchased it in 1997” – Omnitrax CCO Peter Touesnard

However, a statement Tuesday afternoon from Infrastructure Minister Blaine Pederson didn’t provide any hope for Churchill that the province would jump on board to fund the repairs.

“Today’s technical briefing provided by Omnitrax was clearly inadequate,” Pederson said. “A final assessment of damages to the rail line and associated costs of repairs is not complete, resulting in many unanswered and hypothetical questions…

“What was made clear today by senior Omnitrax officials is that they are not prepared to repair, maintain or operate the rail line. It appears that they intend to abandon the line. If so, then it is their obligation to the people of Churchill and indeed Manitobans to communicate their abandonment decision to the federal government.”

The lack of communication between Omnitrax and the province has been an issue for more than a year. Even before rail service was halted in May, Omnitrax had made it clear it wants the federal or provincial governments to start assuming the costs of running the line.

The company has also said it’s been in discussions for more than a year to sell the line to a group of northern Manitoba First Nations, but no real progress has reportedly occurred.

Many community leaders have long favoured a solution that includes the exit of Omnitrax.

“I think it’s time to tell Omnitrax to take a hike,” said Flin Flon NDP MLA Tom Lindsey. “They’ve been horsing around for how many months now? It’s time to nationalize it.”

On Tuesday, Churchill Mayor Mike Spence said: “Enough is enough. We have to sit down with the province and the federal government as soon as tomorrow. Time is passing us by. If repairs are expedited and started right away the line can be open in time for polar bear season.”

He said despite plans that have been put in place, including an increase in storage capacity for diesel and jet fuel, it will not be enough to last the winter if rail service does not resume. A plan to bring in propane — the heating fuel used by most residents in Churchill — has still not been finalized.

“The community is getting more frustrated,” he said. “We have never faced this type of challenge before. It’s been two years of this. It is unacceptable.”

A spokeswoman for federal Transport Minister Marc Garneau said Tuesday the Liberals will ensure food and supplies reach Churchill — but she didn’t specify how.

“Omnitrax has an obligation to repair and maintain its line and maintain service to residents, and we expect Omnitrax to meet its obligations,” wrote Delphine Denis.

Otherwise, Denis wrote, Ottawa will “examine what are the next steps and alternatives.”

— with files from Nick Martin and Dylan Robertson 

martin.cash@freepress.mb.ca