Railway Track & Structures - February 2008 - (Page 5) INDUSTRY TODAY CN to acquire Athabasca Northern in oil sands region CN plans to acquire the Athabasca Northern Railway Ltd. to preserve a critical rail link to the oil sands region of northern Alberta. CN’s purchase and rail-line rehabilitation plan are premised on long-term traffic volume guarantees that the company has negotiated with shippers Suncor Energy Inc., OPTI Canada Inc. and Nexen Inc. CN will pay C$25 million for ANY and invest C$135 million in rail-line upgrades over three years to improve transit times and service consistency. The 202-mile ANY connects with CN at Boyle, Alta., located 101 miles north of Edmonton. CN’s plans for the line will preserve market access to existing and potential receivers along the rail corridor. Today, sulfur and petroleum coke move southbound on ANY, and increased volumes of these commodities are expected to move over the line in future. CN’s line rehabilitation, including upgraded rail, ties, bridges and new ballast, will allow greater volumes of northbound shipments of construction materials and machinery to support oil sands development. Without the commitment and investments being made by Suncor, OPTI Canada, Nexen and CN, the rail CN is acquiring the Athabasca Northern and plans to spend C$135 million to upgrade it. line faced abandonment. ANY marks CN’s third shortline transaction in northern Alberta in the past two years. In January 2006, CN purchased the Mackenzie Northern Railway and Lakeland & Waterways Railway for C$26 million, and in December of that year it acquired the Savage Alberta Railway, Inc., for C$25 million. In 2006 and 2007, CN spent C$58 million to upgrade the rail infrastructure of the former MKNR and SAR and is planning C$22 million in further improvements in 2008. On the labor side, United Steelworkers Union at CN's Canadian operations ratified a new four-year collective agreement. The agreement www.rtands.com Railway Track & Structures February 2008 5 http://www.rtands.com
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