Rail service is on track for improvement in the greater Edmonton area.

The news comes as a new rail service study shows there is a growing concern that the existing rail freight network in Alberta could soon be derailed if changes aren't made.

The survey, carried out as part of the Edmonton Region Rail Strategy Study 2006, shows 60 per cent of respondents were either "concerned" or "very concerned" that Alberta's rail carriers will not be able to satisfy their requirements for rail service in the next five years.

The survey of transportation users showed they expect their shipments to increase by five per cent a year for the next five years, growth described by Edmonton Economic Development Corp. (EEDC) officials as huge.

Jack Dagley, Business Edge
Athabasca Northern Railway Ltd.'s Bob Feeney sees intermodal service in company's future.

The survey attracted 111 responses, of which 53 are current Canadian National Railway (CN) or Canadian Pacific Railway (CP) rail customers in the Edmonton area. Forty-three per cent of the respondents would be considered as large shippers, spending more than $1 million per year on rail freight for shipments originating or terminating in northern Alberta, with 23 per cent being smaller rail shippers who spend less than $250,000 annually on rail services in the region.

EEDC commissioned the overall study - with funding from Western Economic Diversification and Transport Canada, Alberta Economic Development (AED) and Alberta Infrastructure and Transportation - to better understand the rail transportation needs of Edmonton firms, and the capabilities and constraints of rail service providers in the region.

It's also the first move of what could become a provincewide look into the rail network. However, other studies, including one by the Van Horne Institute in Calgary and one from AED that would look specifically at northern Alberta areas such as the Wood Buffalo region, are still only in the idea stage with no funding or timelines in place.

The Van Horne Institute, which focuses on transportation issues, would like to concentrate its efforts on the effects of the Pacific Gateway initiative - a strategy to prepare B.C.'s infrastructure to better tap into Asian-Pacific markets.

"We think there needs to be an investigation of the Pacific Gateway Strategy," says institute president and CEO Peter Wallis. "How can the strengths from a refurbished Pacific Gateway be translated into strengths here in Alberta?" Wallis says it's important to consider what the consequences of the federal government's plan to bolster the transportation gateway to the Asia-Pacific region will mean for Alberta and other points east, including Saskatchewan and Manitoba.

"We haven't gone very far with it (a proposed study that would encompass all transportation infrastructure such as rail and road), but that's what we're looking at," says Wallis. "We're in the process of seeing if we can find enough interest to help us defray the cost of the investigation."

But while the institute is in the preliminary stages and AED says it is too early to comment on plans to study rail services in the north, EEDC is moving into the next phase of its work.

"Within the next year, we would expect to see significant pronouncements around specific efficiencies as well as plans for infrastructure improvement to handle the increased forecast rail demand," says Lori Schmidt, EEDC director of industry and cluster development.

Schmidt adds EEDC decided it was time to move forward with a rail strategy because of construction of the Fairview Container Terminal at Prince Rupert, B.C., where Phase 1 is expected to be operational within the next 18 months. Another factor is the impact of northern development of boom areas such as Fort McMurray.

Bob Feeney, manager of business development for the Athabasca Northern Railway Ltd., which owns and operates the railway between Boyle, 70 miles northeast of Edmonton, and Fort McMurray is bringing a northern perspective to the Edmonton region study.

He adds he would like the review to address an intermodal strategy. "What we want to do is bring goods down from Fort McMurray to Edmonton where they could be transferred onto Class 1 rail systems (CN or CP)," says Feeney. "The business we bring down has an impact on Edmonton. If we can extend our business, that's going to affect Edmonton."

Fort McMurray doesn't have intermodal service, but Feeney points out that it's growing quickly enough to soon be justified. "The intermodal business in Canada is growing tremendously. Class 1 railways want to use those cars between the major centres. It's a matter working out a strategy to make everyone comfortable with it," says Feeney.

Because there is no intermodal system there now, container products that could be shipped by rail to Fort McMurray have to be transferred off flatcars, and emptied and loaded onto other types of railcars or be trucked up north.

"The huge growth in rail right now is all in the containers. It's a whole new chapter in rail," notes EEDC's Schmidt, who would also like to see Edmonton become a warehousing and logistics hub.

In the meantime, Schmidt says she and her colleagues are now working with CN and CP to see if they can improve efficiencies in the existing rail freight system.

(Laura Severs can be reached at laura@businessedge.ca)