OTTAWA — Canada’s two major railways are teaming up to fight an effort by a small rival to grab some of their grain moving business, the National Post reports.
Edmonton-based Ferroequus Railway Co. Ltd. has applied to the Canadian Transportation Agency for the right to use Canadian National Railway Co.’s lines to carry grain diverted from lines owned by Canadian Pacific Railway Co.
Ferroequus wants to pick up grain where CPR lines meet those of CN at Lloydminster, Sask., and Camrose, Alta., and carry it on CN lines to the port of Prince Rupert, B.C.
While the amount of grain is relatively small, about 9,000 cars a year, the case could set a precedent in terms of competitive access to the rail system.
“What we’re doing is we’re trying to get a little competition into [the system]. The [Canadian] Wheat Board has told us they would like to get more of this grain moving to Rupert and we want to try and offer that solution to them,” said Bob Neil, chief operating officer of Ferroequus.
CPR has no line to Prince Rupert, so most the grain in its catchment area goes to Vancouver. CWB would like to see more grain moving to Prince Rupert to ease congestion in Vancouver as well as more competition for rail traffic, said an official with the organization.
Ferroequus, which last year had another bid to use CN lines denied by the CTA, won a small victory last month when the agency rejected CN’s request to have the application dismissed.
“It cannot be said that CN has any absolute right to a shipper’s traffic. The fact that CN may have benefited from the Canadian Wheat Board traffic originating on CPR lines routed to Prince Rupert in the past does not make this traffic CN’s forever,” said the agency in its ruling.
The agency has granted CPR intervenor status in the case and is weighing its request to deny Ferroequus’ application.
Mark Hallman, a CN spokesman, said the company is opposed because the proposal brings no benefit to the public.
Ian La Couvee, a spokesman for CPR, said it is concerned Ferroequus will start taking traffic. “Their request is basically to try and run a railway without having to own the assets, or invest or have a stake in the assets,” he said.