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COMPETITION WATCH: CPR begins capacity expansion in western Canada

CALGARY, Alta. -- Canadian Pacific Railway has begun a major expansion of the track network in its western corridor...


CALGARY, Alta. — Canadian Pacific Railway has begun a major expansion of the track network in its western corridor extending from the Prairie region to the Port of Vancouver.

The expansion is expected to cost approximately $160 million. When completed this fall, it aims to increase CPR’s capacity in western Canada by 12 per cent, or more than 400 freight cars a day, says the railway.

“There have been positive developments in our customers’ markets as well as sufficiently encouraging signals in the federal government’s Bill C-44 that CPR has decided to take the first step to expand our western track network,” said Rob Ritchie, President and Chief Executive Officer of CPR.

CPR recently signed a five-year contract with its largest customer, Elk Valley Coal Corporation, providing for an increase in coal volumes and rates through 2009. Three major potash producers, all served by CPR, have announced
plans to increase production by a total of 2.6 million tonnes per year between the second quarter of 2006 and the fourth quarter of 2007.

Bill C-44, as drafted with amendments to Canadian transportation law, would provide a sufficiently stable regulatory environment to give CPR the confidence to invest in more capacity.

CPR’s $160-million expansion program this year is in addition to planned
capital investment of approximately $760 million.

The expansion work this year involves 25 projects, including:

-10 projects between Moose Jaw, Sask., and Calgary to extend sidings and lay sections of double track;
-three projects between Edmonton and Calgary to extend sidings and build a new siding;
-12 projects between Calgary and the Port of Vancouver to extend sidings and lay sections of double track.


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