Shipping industry members are anxiously awaiting a decision from CN Rail as to which shipping line will be calling on the Fairview Container Terminal upon its completion later this year.
It’s a decision that many had expected to have been announced by now, but CN apparently is playing its cards close to the vest as it seeks out the best deal for its users and the “unique opportunity” that the Rupert port presents.
The Daily News featured the background of the negotiations thus far and how they may impact on the railway and the container port.
CN RAIL SAYS SHIPPING LINE IS TO BE KNOWN SOON
As work on first phase of container port nears end, deal is likely imminent
By Leanne Ritchie
The Daily News
Tuesday, April 24, 2007
Pages one and three
CN Rail expects to announce in the very near future who will be using the new Fairview Container Terminal to ship products.
“We are on schedule to open the facility in the fourth quarter, maybe slightly earlier. Customer interest continues to be extremely strong and we are hopeful we will have an announcement there in the near future,” said Claude Mongeau, executive vice-president and chief financial officer for CN Rail.
People in the shipping industry had anticipated an announcement of an agreement with a shipping line back in December or early January.
Given that the facility is expected to open in October of this year, analysts questioned whether CN would soften its rates if it did not soon see an agreement.
“We are sitting with a unique project at a unique doorway into North America for these containers, and therefore, as I have said in the past, I think that unique opportunity should be priced appropriately,” responded Mongeau, speaking during yesterday’s first-quarter results conference call.
“I think that is recognized by the steamship community and their customers and we will be having some announcements in the near future on that.”
Construction of the new facility is actually ahead of schedule, noted company officials.
The Fairview Container Terminal is a joint venture between CN Rail, Maher Terminals and the Port of Prince Rupert. Maher Terminals will operate the $170 million facility that will be able to move 500,000 (TEUs) average-sized containers from ship to rail each year.
While the investment industry has been waiting for the announcement of a shipping agreement, both Maher Terminals and CN Rail have had a busy first quarter.
In March, Maher Terminals announced it is being purchased by RREEF Infrastructure, a division of Deutsche Bank’s Asset Management division.
And since January, CN’s shipments have been slowed by bad weather and the company has been suffering ongoing labour action.
Just prior to the conference call, the federal government announced the appointment of a mediator to solve the rail line’s dispute.
In February, the harbour in Prince Rupert was full of grain tankers waiting to load after bad weather and the labour action slowed grain shipments.
Speaking from New Brunswick, Hunter Harrison, CN Rail’s president and CEO, said it has been the most challenging quarter in his 40 year experience.
“I’ve got a big smile on my face, there’s no mud slides, no avalanches, no rain, no high winds, no labour strikes, no lockouts, life is goods,” said Harrison.
“It’s as good a performance as I have ever seen, given what we have had to deal with.”
CN’s first-quarter profits were $324 million, 10 per cent below its year ago earnings, because severe winter weather, hampered operations in a “challenging” period.
“Our results for the quarter were affected by unusually difficult winter weather in Western Canada during January and February, a work stoppage by conductors and yard-service employees across Canada in February and then avalanches and landslides in Western Canada that blocked out the main line to and from Vancouver in March,” said Harrison.
The major rail carrier said its earnings amounted to 63 cents per share diluted, compared with net earnings of $362 million or 62 cents per share in the same quarter of fiscal 2006.
A strike by conductors and yard service employees cost the company $35 million in profit, or about seven cents per diluted share, said CN Rail which reported its results after the close of financial markets.
Revenues for the three months that ended March 31 were essentially unchanged at $1.9 billion.
Locked out employees began returning to work last Thursday after the federal government passed back-to-work legislation, ending CN’s lockout as well as the workers’ strike action.
The railway left its second-quarter dividend unchanged at 21 cents per share. Its shares closed down 45 cents at $55.85 in Monday trading on the Toronto Stock Exchange.
It’s a decision that many had expected to have been announced by now, but CN apparently is playing its cards close to the vest as it seeks out the best deal for its users and the “unique opportunity” that the Rupert port presents.
The Daily News featured the background of the negotiations thus far and how they may impact on the railway and the container port.
CN RAIL SAYS SHIPPING LINE IS TO BE KNOWN SOON
As work on first phase of container port nears end, deal is likely imminent
By Leanne Ritchie
The Daily News
Tuesday, April 24, 2007
Pages one and three
CN Rail expects to announce in the very near future who will be using the new Fairview Container Terminal to ship products.
“We are on schedule to open the facility in the fourth quarter, maybe slightly earlier. Customer interest continues to be extremely strong and we are hopeful we will have an announcement there in the near future,” said Claude Mongeau, executive vice-president and chief financial officer for CN Rail.
People in the shipping industry had anticipated an announcement of an agreement with a shipping line back in December or early January.
Given that the facility is expected to open in October of this year, analysts questioned whether CN would soften its rates if it did not soon see an agreement.
“We are sitting with a unique project at a unique doorway into North America for these containers, and therefore, as I have said in the past, I think that unique opportunity should be priced appropriately,” responded Mongeau, speaking during yesterday’s first-quarter results conference call.
“I think that is recognized by the steamship community and their customers and we will be having some announcements in the near future on that.”
Construction of the new facility is actually ahead of schedule, noted company officials.
The Fairview Container Terminal is a joint venture between CN Rail, Maher Terminals and the Port of Prince Rupert. Maher Terminals will operate the $170 million facility that will be able to move 500,000 (TEUs) average-sized containers from ship to rail each year.
While the investment industry has been waiting for the announcement of a shipping agreement, both Maher Terminals and CN Rail have had a busy first quarter.
In March, Maher Terminals announced it is being purchased by RREEF Infrastructure, a division of Deutsche Bank’s Asset Management division.
And since January, CN’s shipments have been slowed by bad weather and the company has been suffering ongoing labour action.
Just prior to the conference call, the federal government announced the appointment of a mediator to solve the rail line’s dispute.
In February, the harbour in Prince Rupert was full of grain tankers waiting to load after bad weather and the labour action slowed grain shipments.
Speaking from New Brunswick, Hunter Harrison, CN Rail’s president and CEO, said it has been the most challenging quarter in his 40 year experience.
“I’ve got a big smile on my face, there’s no mud slides, no avalanches, no rain, no high winds, no labour strikes, no lockouts, life is goods,” said Harrison.
“It’s as good a performance as I have ever seen, given what we have had to deal with.”
CN’s first-quarter profits were $324 million, 10 per cent below its year ago earnings, because severe winter weather, hampered operations in a “challenging” period.
“Our results for the quarter were affected by unusually difficult winter weather in Western Canada during January and February, a work stoppage by conductors and yard-service employees across Canada in February and then avalanches and landslides in Western Canada that blocked out the main line to and from Vancouver in March,” said Harrison.
The major rail carrier said its earnings amounted to 63 cents per share diluted, compared with net earnings of $362 million or 62 cents per share in the same quarter of fiscal 2006.
A strike by conductors and yard service employees cost the company $35 million in profit, or about seven cents per diluted share, said CN Rail which reported its results after the close of financial markets.
Revenues for the three months that ended March 31 were essentially unchanged at $1.9 billion.
Locked out employees began returning to work last Thursday after the federal government passed back-to-work legislation, ending CN’s lockout as well as the workers’ strike action.
The railway left its second-quarter dividend unchanged at 21 cents per share. Its shares closed down 45 cents at $55.85 in Monday trading on the Toronto Stock Exchange.
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