(The following article by John Rebchook was posted on the Rocky Mountain News website on August 28.)
DENVER — Denver-based OmniTRAX is one of four finalists bidding to privatize BC Rail in British Columbia, the third-largest railway in Canada.
OmniTRAX is one of the largest privately held railroad companies in North America.
British Columbia plans to continue to own the railway right of way, rail bed and the 1,898 miles of track. British Columbia wants a private-sector investor to take over the operation and management of the freight-rail service and provide needed improvements.
OmniTRAX owns 11 railroads, including one in Loveland, with a total of about 1,500 miles of track.
BC Rail generates more than $300 million in revenues annually, but it has been a black hole as far as finances.
In the past 15 years, it has cost Canadian taxpayers $964 million – $608 million in asset write-offs and debt of $356 million.
Jeff Knight, a spokesman for the Ministry of Transportation in British Columbia, said he has no details of the bids, such as how much it would cost to take over BC Rail or when the government will make a decision.
Officials from OmniTRAX declined comment.
A report in The Vancouver Sun last month, however, said it had obtained internal documents from the government that indicated OmniTRAX might have the inside track in landing the deal.
OmniTRAX already is a “provincially regulated railway” and it would face less red tape, regulations and taxes than Canadian companies, according to the newspaper report.
An OmniTRAX deal “also offers shippers a perception of an independent, third-party owner for BC Rail,” according to one document obtained by the paper.
The other three finalists are Canadian Pacific Railway, Canadian National Railway and RailAmerica. RailAmerica also is based in the U.S. and has a large Canadian presence.
In Colorado, OmniTRAX owns the 80-mile Great Western Railway, which serves customers such as Amalgamated Sugar, Anheuser- Busch, Colorado Sweet Gold, Eastman Kodak, Universal Forest Products, Wedron Silica and Western Sugar, as well as many companies in the fertilizer, grain and building materials markets.