Saskatchewan’s newest short-line railroad has begun operating out of its home base at Leader.
In its first few days of operation, Great Sandhills Railway had already travelled the length of its 188 kilometre track – slowly – to serve its customers.
Although Canadian Pacific Railway used the track until the day before officially transferring it to its new owners March 14, most of the line is subject to a speed limit of 16 km-h.
GSR general manager Peter Skretting said the ties under all but 40 km of the track are in bad shape. It will take eight to 10 years and $3.5 to $4 million to fix them.
Still, the new owners think they can turn a profit and finance the repairs through cash flow.
“The amount of business that CP was able to generate did not justify the expense,” he said. “We’re a smaller company and we have lower costs.”
GSR operates from Swift Current to just past Burstall, Sask. about 2.5 kilometres into Alberta. It includes the CPR lines known as Empress and Burstall subdivisions and the Hazlet Spur.
A numbered company wholly owned by Great Sandhills Terminal, just outside Leader, bought the McNeill Spur at the same time and GSR will operate it as well.
The purchase price has not been disclosed but the private company took advantage of the provincial government program that provides a 15-year interest-free loan of 32 percent of the price.
“We have raised most of the other money from local investors, including all of the RMs and towns and villages on the line,” Skretting said. “Every one of them invested, including Cypress County in Alberta.”
The grain terminal is the major shareholder, and others include local producers and businesses.
The line is one of the few in Saskatchewan that aren’t grain dependent. Although it will move grain from terminals, elevators and producer loading sites, it will also move products from the Empress Gas plants in Alberta.
Highways and infrastructure minister Wayne Elhard, who is also the MLA for the area, said the long-term prospects for the line are good.
“That particular rail line runs parallel to Highway 32, one of the most notorious poor roads in the area and it’s going to be under construction over the next three years,” he said in an interview. “So this will be a way for grain to move out of the area.”
Elhard said there is always interest in short lines around the province from communities and organizations.
The people leading the efforts to develop short lines are key to a successful outcome, he said.
He added that rail movement is efficient and environmentally sound.
“There is so much concern in rural Saskatchewan about transportation-related issues and especially if highways are under pressure in the area,” he said.
GSR will employ 10 permanent staff; seven are moving to Leader as a result. Skretting said the qualified people now employed by the railway include those who formerly worked for both Class 1 Canadian railroads.
Skretting himself worked for Canadian National Railway out of Edmonton.
He said negotiations with CPR generally went well over the last two years.
“Canadian Pacific applauds the establishment of this new short-line railway, which will allow grain and other important commodities to be transported with a high level of service,” said Jane O’Hagan, CPR’s senior vice-president of strategy and yield, in a news release.
The new short line takes Saskatchewan’s network to a total 1,600 km.