Churchill Video of the Week – A Trip Down the Tracks

Arnaud Maldague made this epic bicycle journey along the tracks of the Hudson Bay Line from Churchill to Gillam to bring awareness to the plight of Churchill, Nunavut and communities affected by the loss of rail service. For over a year the tracks have been unusable and no train is able to reach the northern terminus of Churchill. With a new deal for a local group and financial investor to buy the port in place, hopes are high that the isolation will end soon. Below is Arnaud’s account of the situation:

“After skiing the Arctic for 100 days, I arrived in Churchill, Canada, only to discover the city had no more functioning railroad. The rails were flooded on 23 may 2017 after a huge winter storm hit the region earlier this winter. The damaged rails suffered some washouts, which cut the city only ground supply and communication mean. Private owner Omnitrax, whom is legally bind to maintain the tracks, refused to repair the line, pretexting exaggerated costs and financial failure. The government refused to funnel money to the company, resulting in a political drama and no repairs. Churchill’s citizen are stuck with high prices, jobs cuts and a bitter feeling of being abandoned. The situation also impacted the whole Kivalliq region, Nunavut, which relied on Churchill rail supply line. One year later, nothing had changed… Since the rails were part of my itinerary and “The Manneken Trip” expedition, I decided to shoot this video while cycling the rails down towards Gillam and later Winnipeg. The idea was to generate some awareness and report on the state of the rails. As expected, the damages aren’t that bad, and could easily be repaired. It was a horrible ride with its lot of nice surprises! Nature was super beautiful however : the taiga, the boreal forest and lots of birds. Three days after finishing the trip, 41 communities joined together with private company Fairfax and AGT in order to buy the Hudson Bay Railroad and port. It’s an historic move from these community which retransfer ownership into local hands! However, no date has been set for the repairs yet… Due to intensive and long winters, repairs can only take place during the few summer months. If repairs don’t start soon, Churchill might have to face another winter without train.”

Arnaud Maldague.

Port of Churchill Sale Agreement in Place

port of Churchill

The Port of Churchill still vacant while the sale of the business is in limbo. Katie de Meulles photo.

There are no groundhogs in Churchill! So, there really cannot be a “groundhog” day. However, with the recent announcement of the Port of Churchill and the Hudson Bay Line being sold again there seems to be some confusion.

There apparently is another informal agreement that will reestablish ownership of the Hudson Bay Rail line and the Port of Churchill within the northern Manitoba community and keep the facilities under Canadian control.

One North and Missinippi Rail LP have joined forces with Fairfax Financial Holdings and come to an informal agreement to acquire the dormant assets from current owner Denver, Colorado-based Omnitrax.

Fairfax, a Toronto-based investment company, agreed to partner with One North and Missinippi Rail this past November, to purchase Omnitrax’s northern Manitoba assets.

The arrangement includes the participation of 41 First Nations and non-First Nation communities in northern Manitoba as well as seven Kivalliq communities in western Nunavut, along with Fairfax and AGT, the government said.

Omnitrax owner Pat Broe and Fairfax president Paul Rivett negotiated the acquisition, but there are multiple legal issues to finalize before prior to a finalized deal can be completed.

Churchill mayor and One North co-chair Mike Spence has been waiting a long time for this deal to materialize. Spence has been tirelessly lobbying for a deal since Omnitrax began reducing the frequency of rail service to Churchill nearly two years ago.
However, as we all have seen, this deal will not be official until papers have been signed and money exchanges hands. We have seen far too many deals or rumors of deals taken away with the tide of the Hudson Bay.

“Priority No. 1 will be rail line repairs in the very near future and to finalize the acquisition,” Spence wrote in a statement.

“This is a historic partnership involving Indigenous and northern communities with industry leaders that now positions the Port of Churchill as an Arctic gateway for future prosperity.”

The Hudson Bay rail line to Churchill was washed out by a flood runoff from two late spring blizzards in May 2017. Since then, Omnitrax has refused to repair the tracks and has been in an ongoing battle with the Canadian Government over responsibilities regarding the repairs. Initially, the costs of repairs were between $40 and $60 million. Omnitrax claimed it was unable to cover those high costs.

 

Canada Prime Minister Justin Trudeau stated last year that Omnitrax is responsible for getting the train line up and running again. While this is being settled, at this point most likely through new ownership, the federal government has been providing ongoing subsidies to northern residents to help defray escalating costs of goods shipped north.

First Nations Group Ends Churchill Port Bid

Via rail train engine at the port of Churchill.

Train engine being hoisted onto the cargo ship at the Churchill Port. Katie de Meulles photo.

The Port of Churchill is minus one prospective suitor for possible acquisition. The group, iChurchill and a First Nations consortium led by Glenn Hudson, Peguis First Nations Chief has withdrawn from bidding on the Port and the Hudson Bay Line.

“We are disappointed to have put so much time, effort and money into what would have been a timely solution for the people of Churchill and the economy of Western Canada, but we have apparently run up against politics,” said Louis Dufresne , CEO of iChurchill,

“We finally met last week with the government of Canada’s negotiator on the file, Mr. Wayne Wouters, and he made it clear that the government is willing to deal only with one specific company, a Toronto-based financial firm. We can’t understand why this is, given that our partnership meets all of the government’s stated criteria to support the restoration of rail service to Churchill.”

Churchill’s mayor Mike Spence and town council said iChurchill had previously announced that they were still negotiating with Omnitrax and the Canadian government to try and reach an agreement on the sale.

Now, iChurchill states that the federal government is catering to one exclusive buyer and will only offer financial assistance for track repairs to the Hudson Bay Railway for that group exclusively. Trains have not run to Churchill since last May and it appears that the hopes of starting the repairs this summer are fading again.

“Our team believes that these assets can be operated profitably,” said Dufresne. “My head cares about the commercial interests. But my heart is with the people of Churchill and the First Nations of Northern Manitoba. It’s been a year since a flood washed out their only land link to the rest of the country. I hope they can get their railway back online this year, but without a change in position on the part of the federal government, I’m not optimistic.”

We will have to wait and see what other potential buyers and investors arise in the near future.

Churchill Video of the Week – Murals Trailer

With the crisis in Churchill continuing to affect the everyday lives of all 800 residents, a recent art project coordinated by Kal Barteski has brought hope and promise of change to the isolated northern town. Barteski organized artists from around the world to gather and paint northern themed murals on neglected and mostly abandoned buildings around the subarctic outpost on the Hudson Bay.

Now a short documentary film has been made portraying the roots of the project and how it became a reality.

“I Know I’m Here” is a collaboration of 18 artists looking to leave a mark of reassurance and hope for this small community fighting through some very tough times. Within the past couple of years, the Port of Churchill has been shut down, the Hudson Bay Line has been washed out and inoperable for a year, and just recently the most popular restaurant, Gypsy’s Bakery, burned to the ground. The strife has been constant and the heart and resilience of the residents are being tested beyond belief.

As Churchillians deal with stresses from being shut off from the south with the only way in and out of the town being by air, Kal and her group of artists have created these massive murals have transformed the landscape and instilled some hope in the community.

China Firm Enters Ring to Buy Port

Churchill Port, Churchill , Manitoba

Port of Churchill grain shipping operation on the Churchill River. Port of Churchill photo.

Just when you thought the Port of Churchill and accompanying Hudson Bay Line were in a negotiated sale…again…another potential suitor has arisen to acquire the assets and begin shipping from the port.

Executives from Herun Group Co. Ltd., a Chinese company with massive agricultural interests as well as a wealth of port-operating experience, visited Churchill a month ago to gather more information and inspect the port facility. The company is one of the largest firms in China and seemingly has the financial clout and long-term experience in the shipping industry to offer a long-term solution to keeping the port and train line open.

Concerns that the Port of Churchill would fall into foreign hands and their primary interests would be alleviated by an agreement with the Manitoba Metis Federation and thus have that group own 51 percent of the company. Herun has also agreed to pay the $20 million price to Omnitrax without relying on any additional support from the Canadian government according to Manitoba Metis Federation president David Chartrand.

“Herun made it very clear they’re prepared to come up with a substantial amount of cash,” he said.

Herun owns and operates 11 international ports and recently closed a deal to acquire a port in Brazil, the country China trades the most with. Since Herun also processes various grains and oilseeds, interest in Churchill’s port facility is paramount.

“To me, in order to make this situation work for the railroad and Port of Churchill, you really need to have a company that is in the business,” said Joe Ng, chairman of JNE Group of professional engineers based out of Hamilton, which arranged the tour.

Port of Churchill. Claude Daudet photo.

“Otherwise, new people come in and after two years they can’t utilize the rail and port and they bail out.”

Herun’s interest stems from the fact that it imports raw materials such as soybeans and canola for its China crushing facilities.

Missinippi Rail and One North, a consortium of First Nations and Toronto-based Fairfax Financial Holdings Inc. are also in partnership to purchase the facilities. Omnitrax and Ottawa have been in negotiations with each other since late last year.

However, Omnitrax Canada President, Merv Tweed, reported that the latter group has only signed a letter of intent and Omnitrax has received inquiries from several other Canadian companies. “We are continuing discussions with a number of interested parties,” Tweed said.

A most recent inquiry and potential buyer, another First Nations group named iChurchill, appeared this past week with a comprehensive proposal that includes utilizing Churchill’s port and rail line to ship wood and possibly oil in addition to grain.

Ng conceded Herun is not first in line with their new proposal. “We’ve come in late so we have to wait until other people finish talking. It’s no different than a lineup at a counter,” said Ng, the 2016 winner of Entrepreneur of the Year awarded by the Association of Chinese Canadian Entrepreneurs.

Any new deal with the prospective buyers would include the damaged rail lines, as well as some buildings and land and in other northern towns like Gillam. The estimated $46 million in track repairs would be covered by the company that ends up purchasing the facilities. The governments annual $5 million in maintenance payments currently paid to Omnitrax would continue with the new owner.

Even though Churchill has a pretty short shipping season, Herun is looking ahead to the future according to Ng. “As far as they’re concerned, the world’s turning warmer every year, and there might be longer and longer shipping seasons as years go by,” he said.

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