Churchill waits as blame game continues

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This article was published 17/10/2017 (2910 days ago), so information in it may no longer be current.

OTTAWA — The federal government rejected an offer by Omnitrax last week to restore restricted service along the northern Manitoba rail line to Churchill before next month’s freeze-up, the Free Press has learned.

The Denver-based company said it presented an engineering report Oct. 6 that outlined a way lighter trains could use the flood-damaged line within 30 days, at a cost of between $5 million and $10 million.

The province already has spent $6 million shipping emergency propane reserves up to the town of 900 on the shore of Hudson Bay, some 1,600 kilometres north of Winnipeg.

Earlier this summer, Omnitrax had AECOM Canada create a $43.5-million plan to restore service along the line 60 days before the November freeze. This report, also published by AECOM, involves a much lighter price tag to restore “very restricted service” within 30 days, but adds full service likely would cost close to the original estimate.

The report says cars similar to those used for rail maintenance could be used “to take emergency supplies/provisions to Churchill during the winter of 2017-18. Clearly, neither regular train service nor Via Rail service should be contemplated until permanent repairs are carried out.”

A spokeswoman for Transport Minister Marc Garneau confirmed Monday negotiators received a “last-minute suggestion” from Omnitrax in recent talks aimed at transferring the rail line and Port of Churchill into local hands.

“It is disappointing that Omnitrax continues to deflect responsibility for fixing the line to everyone else but themselves,” Delphine Denis wrote in an email.

According to the report, repairs would involve 20 people each working a maximum of 10 hours each day, provided they had sufficient lodging, equipment and weather. The report notes the major pieces of equipment are “readily available.”

The report concedes it might be too late, with the last rail test taken in August and the last full inspection in early July. “The impact of higher temperatures with only skeleton track to restrain the buckling forces may have resulted in additional track damage that now has to be repaired,” it reads.

Denis said Ottawa is interested in giving federal dollars only to the line’s potential new owners.

“Omnitrax has a clear responsibility to fix the line and we expect them to do so. The federal government will not give further funding to Omnitrax when it is already in breach of its agreement and has shown no interest in being a responsible owner of the line,” she wrote.

Churchill Mayor Mike Spence — who is part of the talks to transfer the rail line and port to two northern Manitoba groups — was skeptical of Omnitrax releasing the new report.

“In late May, they said the rail line was catastrophically damaged. Now they say there is a quick-fix option. Why did they not look at a quick fix to restore service sooner? They directly are jeopardizing the safety of our community and the communities that rely on the Bay Line,” Spence wrote Monday.

He lamented the propane shipment that arrived Sunday possibly could have been brought up by rail, and blamed Omnitrax.

“They are holding our community hostage and this needs to end. I expect the federal government to take swift action.”

Meanwhile, Churchill’s rail line woes had various authorities pointing fingers at each other Monday, with the government casting doubt on Omnitrax’s claim Ottawa refused a visit to inspect the damaged rail line to Churchill, and Omnitrax playing down suggestions it blocked another company from inspecting the line. On Friday, the federal Liberals issued a notice they intend to sue Omnitrax for breach of contract if it doesn’t fix the line within a month. (Ottawa since has revealed the deadline is for a response, not construction.)

Omnitrax responded Friday with a lengthy statement from its Canadian head, Merv Tweed, which chastised the federal government. It also accused the transportation department of dragging its feet.

“When the flood came, we immediately informed our regulator of the damage and requested that they come view this damage first hand. Transport Canada declined to personally inspect the damage,” Tweed said.

An Omnitrax official, who spoke on the condition he wouldn’t be named, said Monday he met June 16 with three Transport Canada officials at their Prairie-region offices at 344 Edmonton St. in Winnipeg, to discuss the damage and invite them to come survey the line.

Garneau told the Free Press he was “not aware of the specific details.”

Meanwhile, Garneau clarified his month-long ultimatum is for Omnitrax to adequately reply — not to get the rail line under construction. “The 30-day timeline is for them to respond to the letter that I am sending them,” he said.

That’s despite a news release Friday from Energy Minister Jim Carr, which said Transport Canada had sent Omnitrax a notice of default “demanding that it complete all railway repairs and resume rail service within 30 days.”

Carr had told the Free Press he’d be consider avoiding a lawsuit if Omnitrax showed some progress. The minister is planning to visit the northern Manitoba town later this week.

Meanwhile, Spence said Sunday Omnitrax had denied Keewatin Railway Company access to the line, after it offered June 23 to repair the line, and said July 6 it could be fixed for $2 million.

But Omnitrax said Monday it had reached out to KRC’s general manager, Tom McCahill, after that estimate, providing some of its engineering findings about the damage. (McCahill did not immediately respond to an interview request.)

“We’ve never received a formal request from them to come on-site. Nor had we ever sent them a formal notice saying they couldn’t go out on the line,” the Omnitrax official said.

He noted the two companies regularly work together on the line’s western flank.

The province said Monday it’s still considering whether it would follow Ottawa in suing Omnitrax for breach of contract.

Carr’s notice Friday said if the rail line wasn’t repaired, the feds would sue Omnitrax for $18.8 million — that’s how much Ottawa has already paid of $20 million pledged under a 2008 agreement.

That agreement had the province and Omnitrax itself each pledge to also contribute $20 million over 10 years, to keep the rail line running — but the province’s contribution fell under a separate contract and the province paid the full amount by 2013.

“Since the closure of the rail line, our government has focused primarily on the safety and security of the community, mainly with respect to critical supplies of food, propane and other fuels,” provincial Infrastructure Minister Ron Schuler said Monday.

He said Ottawa’s legal threat was “not surprising, given the company’s inaction.”

“Our government had a sense this step was coming and clearly understands the federal government’s position.”

dylan.robertson@freepress.mb.ca

AECOM report on 30-day fix for rail line to Churchill