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Along with shipping Saskatchewan
and Manitoba grains, oilseeds and
energy products out of the country,
Northgate may also look to be a supply
centre for dry commodities brought into
the country, including frac sand for the
oil and gas sector, dry cement for the
construction industry and fertilizer for
farmers.
Longtime Canadian grain
transportation observer Mark Hemmes,
president of Quorum Corp., said the
Northgate project could do well as a
regional player when it comes to rail
transportation.
“It appears to be another good
alternative for farmers, but its success will
depend a lot on how well it is marketed,”
he said.
Quorum, which is based in Edmonton,
was selected by the federal government
in 2001 as an independent, third-party
watchdog to monitor the efficiency of the
Prairie grain handling and transportation
system.
“We saw last year here in Canada how
a combination of severe winter weather
and a bumper crop resulted in a rationing
of rail capacity in Western Canada,” said
Hemmes. “And in many respects right
now, U.S. farmers south of the 49th are
also challenged by rail capacity. So the
challenge ahead for this project may be
to ensure it has the rail cars when they are
needed.”
Meanwhile, BNSF officials say they
are ready for the challenge. Noting that
improvement in the U.S. economy in
recent years has corresponded with
increased demand for rail service in many
parts of the U.S., BNSF undertook a major
capital improvement project. Out of an
overall $5-billion improvement program,
it included $1 billion worth of upgrades
to rail services in the Northern Corridor,
which spans the northern U.S. between
the Pacific Northwest and Chicago, and
includes the branch line running from
Northgate to Minot, North Dakota.
“Our capital upgrade program is
investing about $400 million in North
Dakota alone to expand rail capacity
and replace and maintain the network
infrastructure,” said Roxanne Butler,
media relations director with BNSF. “No
one can offer absolute guarantees, but
the company has invested heavily to
ensure it has capacity to meet customer
demands.”
Overall, Northgate appears to be a
good opportunity for Saskatchewan
farmers and oil and gas producers, said
Lyle Stewart, Saskatchewan minister of
agriculture.
“Certainly the government has been
supportive of the project, which will
provide producers with another outlet
for the commodities they produce,” said
Stewart. “With [Ceres’] plan and facilities
in place, we feel their service will be
very positive for both the agricultural
and oil and gas industries. Improved
access to these markets will create some
real opportunities for Saskatchewan
producers.”
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