Hey there, time traveller!
This article was published 15/1/2016 (2356 days ago), so information in it may no longer be current.
A deal is in place between Omnitrax Canada and a group of First Nations led by Mathias Colomb Cree Nation to acquire the Hudson Bay Railway and the Port of Churchill.
Details were not released, but the players made it clear it would not be a conventional cash transaction and there would have to be an element of public-sector support to be able to finalize it.
A previously announced 45-day period of diligence expires Tuesday.
"We are proud to champion this effort to reinvigorate the north in a meaningful way, " said Arlen Dumas, chief of the northern Mathias Colomb First Nation.
Dumas said the transaction will eventually include support from various "partners."
He was cryptic in his response to questions about the structure and the financing of the deal, suggesting it would reflect new realities -- a historic transfer of land and infrastructure back to their rightful owners.
"These processes (the manner in which the railroad was owned and operated) were developed 50 years ago, and they may have worked 50 years ago, but they need to be re-shuffled," Dumas said. "We need to move in a different direction.
"Fundamentally, the way we have been doing business in the north is a convention of an outdated time."
How that will manifest itself in the transfer of ownership of about 1,000 kilometres of railroad line and a deep water port on the Hudson Bay remains to be seen.
However it works, Merv Tweed, president of Omnitrax Canada, seemed to be on the same page.
"We have looked after the property for 17 years," Tweed said. "We recognize it is time to move back to the rightful owners."
Again, while no details were disclosed on how the deal is to be structured, Tweed acknowledged it would not be a conventional commercial transaction.
"It has been a real experience regarding how these deals are put together," he said.
"I see the positives in the outcome. It is new to us."
Omnitrax has been unsuccessful in diversifying the cargo shipped out of the port and has relied exclusively on grain exports. But grain volumes fell dramatically this year and may have prompted Denver-based Omnitrax to take steps to get out of the Manitoba market.
Mathias Colomb Cree Nation, along with two other northern bands, have experience in the railroad business.
They acquired the line from Pukatawagan to The Pas from Omnitrax in 2006 and have run the Keewatin Railway Co. successfully since then.
That deal was done in a way that does not allow the owners to make a profit.
"It's doing very well," Dumas said. "We are acquiring additional assets and contracts... It just depends on how you look at profit. To me, the benefit of having 10 families working for the last 10 years is immeasurable."
Four other bands have submitted official letters of support of the current deal, but Dumas said he is looking to include every First Nation in the railroad's jurisdiction.
Tweed said he's optimistic the negotiations would be completed by Tuesday.
Discussions have been taking place with federal and provincial government officials.
Dumas indicated federal support seems to be forthcoming and said he "invited" participation from the provincial government.
A spokeswoman for provincial Infrastructure and Transportation Minister Steve Ashton would only say: "We can confirm that senior officials from several departments have met with the First Nations and Omnitrax. We are engaged and supportive."
Sinclair Harrison, the president of the Hudson Bay Route Association, which promotes use of the rails and port, said the association would support whatever the ownership structure looked like.
"We are not picking favourites," Harrison said.
"We have been around for 73 years, and we will support whoever is successful and do what we can to help them make it a successful operation."
Martin Cash has been writing a column and business news at the Free Press since 1989. Over those years he’s written through a number of business cycles and the rise and fall (and rise) in fortunes of many local businesses.