Churchill, Man., railway deal in works, say First Nations and private company

A group of Manitoba First Nations says it has formed a partnership with a private company that will lead to the reopening of the rail line to Churchill.

The First Nations say the deal involves an acquisition agreement with the U.S.-based owner of the Hudson Bay Railway, the Port of Churchill and other assets.

The news release issued by the First Nations and iChurchill on Thursday night does not mention Omnitrax by name.

Rail way owner Omnitrax confirmed Friday afternoon it had received a signed letter of intent from a private company with First Nations support, but said it has also received letters of interest from "several other Canadian companies."

"We are continuing discussions with a number of interested parties," the Denver-based company said in a news release.

Indigenous leaders say the railway and port are crucial to the existence of all First Nations in northern Manitoba.

The rail line owned by Denver-based Omnitrax was washed out by floods last spring.

A company called iChurchill Inc. says it hopes to conclude the agreement by mid-June so the rail line can be repaired before fall.

"A consortium of Manitoba First Nations, led by Chief Glenn Hudson, and in partnership with iChurchill Inc., a private Canadian company, has entered into an acquisition agreement with the U.S.-based owner of the Hudson Bay Railway, the Port of Churchill and associated assets," the release says.

"We are proud to have formed this historic partnership and are excited to be working together with the First Nations to restore rail service to Churchill and build a successful business that protects the sustainability of these vital assets well into the future," said Louis Dufresne, president of iChurchill.​

Churchill is home to 900 people and has been struggling after losing its only land connection to the south.

Last May, Omnitrax signed a memorandum of understanding with Missinippi Rail LP, a consortium of about 15 Manitoba First Nations, to acquire the rail line and port for $20 million. In September 2017, the consortium joined forces with One North, originally a separate group representing communities and First Nations along the damaged rail line, to buy the rail line.

On Friday, a spokesperson for the federal government said Ottawa's negotiating teams have not had discussions with iChurchill.

Alexandre Deslongchamps wrote in an email to CBC News that Ottawa continues to support Missinippi.

"The Government of Canada recognizes the importance of the rail line to the people of Churchill and the surrounding area and supports the partnership of Missinippi Rail Partners and Fairfax Financial Holdings as they undertake discussions with OmniTRAX to transfer ownership of their assets in northern Manitoba," said Deslongchamps.

Mayor first heard story in media

Churchill Mayor Mike Spence said he hasn't had any discussions with iChurchill.

"The Town of Churchill continues to work diligently with our partners in the federal government, OneNorth, Missinippi Rail and Fairfax/AGT towards an agreement with the current rail line owner," Spence said in an emailed statement to CBC News.

"There is great urgency to arrive at a negotiated agreement as soon as possible. I remain confident a transfer of ownership and restoration of rail service can move forward this spring and this remains my No. 1 priority.

"I first learned of the iChurchill story through media and have not had discussions with this group." 

Manitoba Premier Brian Pallister said he is happy to hear another group has shown interest in taking over the rail line and port.

"Hopeful always when I hear these announcements, but of course like the people of Churchill, I just really would like to see the rail line rebuilt and the port reopened with solid commitments with whoever is going to take charge of the ownership that they are committed for the longer term."

Omnitrax has said it will not repair the track because it would cost too much money on an already money-losing line.

That has meant people have had to rely on costly air transportation to move goods, including vital supplies such as groceries, as well as people.

Last fall, the federal government filed a lawsuit naming Omnitrax over the need to repair the rail line.

The new deal would still have to be approved by the federal government. Federal Natural Resources Minister Jim Carr is expected to release a statement Friday.