Rate Setting for the Tshiuetin Railway
The New Millenium mining company wished to use the Tshiuetin Railway to transport its iron ore between Shefferville and Emeril Junction.
The rate structure would cover a 7 to 8-year contract and transport of up to 4 million tons by the year 2013. Rates proposed by the Tshiuetin Railway to allow the New Millenium mining company to operate its trains on the line were deemed to be too high by the New Millenium Company.
The Tshiuetin Railway asked SYSTRA Canada (formerly CANARAIL) to conduct an independent review of the rates proposed by both parties in order to come to a mutually acceptable agreement.
The following activities were undertaken:
- Review of iron ore transport plan prepared by Tshiuetin;
- Review of costs (operating and capital) used by Tshiuetin to establish the proposed rates;
- Analysis of New Millennium’s proposed railway infrastructure investments;
- Establishment of rate set to transport iron ore to cover services provided by the railway, New Millennium’s investments, and operating costs.