Alberta not ready to kick in funds on Calgary-Banff rail link despite new proposal

The company behind a proposed passenger rail service that would connect the mountain resort town of Banff, Alta., to the Calgary International Airport says the project would cost $1.5 billion, and it could use some funding from the Alberta government.

But while Premier Jason Kenney says he sees much merit to the project, the province isn't ready to dedicate funds toward it at this time.

Still, the owners of the Mount Norquay ski facility just north of the town have submitted a new proposal to the Alberta government in hopes the rail line could be constructed as a public-private partnership.

Liricon Capital Ltd. owns the ski resort and also holds a long-term lease for the Banff Train Station. It's newly named investment partner is Plenary Americas, a portfolio company of Caisse de depot et placement du Quebec (CDPQ).

The company has been working for years to develop a multi-modal tourism and transportation hub.

They say the link between the tourist town and Calgary would help reduce the burden of passenger vehicles in Banff National Park.

Not ready to commit, premier says 

On Wednesday, Kenney said the provincial government is looking at the proposal closely but isn't ready to put money behind it.

"We are not at any point ready to commit to money on this. We have to give this a very close rigour, and that's the stage we're at right now," he said.

Kenney says the train has "a lot of potential merit," such as improving tourism in the Banff area, increasing access to jobs in the Bow Valley and reducing carbon emissions.

Jan Waterous, managing partner with Liricon Capital, says the goal is to have the train run on hydrogen but "worst case scenario" they have the train run on diesel and electricity to start, then transition to hydrogen.

She said her company's proposal is to have half of the $1.5-billion capital cost provided by the Canada Infrastructure Bank, which has already signed a memorandum of understanding to complete studies and due diligence for the project.

The remaining portion would be covered by Liricon, Plenary and debt financing, Waterous said. While project partners aren't asking the province to commit any upfront capital funding, they are asking it to commit $30 million annually to the project. The province would not start payments until the rail line is complete, which could be as early as 2025.

"It's essentially a mortgage payment on half the capital. And the reason it's only on half the capital is because the other half we can cover from ticket prices," Waterous said in an interview. "So this is actually very good value for the province."

Liricon hopes to get a yes or no from the province by early February, Waterous said, so that it can move on to the advanced design phase of the project

Train stops

Should the project move forward, it could result in the establishment of a 150-kilometre passenger rail service that would potentially include seven stops:

• Calgary International Airport.
• Downtown Calgary.
• Calgary Keith (near Lynx Ridge Golf Club).
• Cochrane.
• Morley (Stoney Nakoda).
• Canmore.
• Banff.

The plan is have the train run from the Calgary International Airport to downtown Calgary every 15 minutes, and from downtown Calgary to Banff National Park every two hours, with 10 trips per day. Net ticket costs for Albertans would be priced at about $20.

The project will require twinning a heavily travelled portion of CP Rail's track. In an email, CP spokeswoman Salem Woodrow said the company is co-operating with all involved parties to fully understand and assess the magnitude of the project.

"Any proposal to co-locate a passenger rail service on CP property must preserve our capacity to move freight, both at current levels and those required to support future growth," Woodrow said. "Alberta's economy depends on a freight rail transportation system that can safely and efficiently move goods and commodities, especially through this critical trade corridor."

A tourism boost

Canmore Mayor Sean Krausert is excited by the potential of the project to boost local tourism and alleviate commuter traffic.

"Our infrastructure surrounding highways are busier than ever before with commuters and tourists alike, and we're trying to invest and upgrade some of those on our own," he said. 

"But the province needs to do the same, and a project of this magnitude will really, really help.

"We have a lot of people that work in Calgary that commute every day. If we could take a fraction of those and put them on the train, that would be awesome."

Environmentalists have previously raised questions about the impact increased rail travel could have on wildlife in the area, as well as the potential environmental harm that could come if the rail line proves popular and increases overall visitation to the park.