Rail Industry Issues PART TWO

1
Rail Industry IssuesPART TWO

• Grain Industry Advisory Council
• 8 August 2008

2
Key Outcomes

• In April 2008, Government announced funding of
  23.7m for upgrading Gold network (except
  Portland) and an additional 19m for general
  freight network maintenance
• ARTC leased Portland (Gold) line as part of
  north-east project and will spend 15 million to
  upgrade it
• Silver lines to be upgraded as required in
  consultation with grain industry. Silver line
  investment program presently being developed.

3
Korong Vale Junction of Kulwin and Robinvale
lines
4
RFNR recommendations

• Many RFNR recommendations implemented
• Access pricing reduced
• Network investment Gold lines, Mildura,
  North-East
• Port rail access Melbourne, Geelong
• Intermodal terminals Dooen, Shepparton (both
  funded), Altona

5
Mildura Line Upgrade

• 73 million upgrade of Geelong to Mildura railway
  line (53m in State funds/20m in Federal
  Government AusLink funds) commenced in Dec 07 for
  completion in 2nd half 09300,000 timber sleepers
  (12.5) 150,000 installed so far project is on
  time and within budget.Will provide 80km/h
  freight train standardReduce transit times from
  14 hours to 10 hours and improve
  reliabilityEnsure rail remains key transport
  mode for export of grain and agricultural
  products from States north-west

6
Mildura line at Dunolly
7
North-East Rail Revitalisation Project

• Conversion of 208km of broad gauge track between
  Seymour and Albury to standard gaugeTrack
  leased to Australian Rail Track
  CorporationWodonga Rail Bypass bypass of
  Wodonga city centreUpgrade and standardise
  broad gauge track to modern standards to
  accommodate faster passenger trains and faster,
  longer and heavier freight trains.
• Will result in 70 of Melbourne Sydney rail
  corridor being double track
• Project will help reduce Melbourne Sydney
  freight train transit times from 14 hours to 11.5
  hours because of fewer delays
• Increase capacity and reliability in critical
  north-south corridor to enable rail to increase
  market share of growing freight task Melbourne
  Sydney rail market share only 10 and needs to
  grow to reduce customer reliance on trucks

8
Interstate freight train in north-east corridor
9
Last 12 Months

• May 2007 intrastate rail lease buyback
  (133.8m)
• May 2007 25m provided to V/Line for track
  maintenance Dunolly - Boort/Wycheproof, Echuca
  Deniliquin and Shepparton Tocumwal lines all
  repaired
• June 07 Rail Freight Network Review (RFNR)
  commissionedJune 07 - AWB GrainFlow contracts
  with El Zorro for 2 year grain haulage contract
  (export and domestic)Dec 07 RFNR released and
  announcement of average 6/tonne rebate for
  domestic grain transported by railDec 07 - 73m
  (53m State, 20m Federal) Mildura track upgrade
  project commenced (due for completion 2nd half
  09)
• Dec 07 Pacific National (PN) threatens to
  withdraw from Victorian export container and
  container rail services
• .

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Last 12 Months

• Feb 08 Government announces 20m Rail Freight
  Support Package over two years providing rebate
  for containers and export grain transported by
  rail regional rail freight services to
  Warrnambool (El Zorro), Horsham (PN), Merbein
  (PN) and Shepparton/Tocumwal (PN) still
  operatingApril 08 Government announces 42.7m
  for regional rail freight network 23.7m in
  funding to rehabilitate Gold network and 19m for
  general maintenance across the freight only rail
  networkMay 08 PN/Asciano sign deal with
  GrainCorp for 8 grain trains for NSW/VICMay 08
  Federal/State agreement to lease north-east
  broad gauge corridor to Australian Rail Track
  Corporation and standardise it 501m project
  (330m Federal, 171m State)
• July 08 Maroona Portland line leased to ARTC

11
Investment

• 900m in rail freight projects presently being
  undertaken in Victoria
• 45m Tottenham Dynon project (Federal)
• 15m Tottenham flyover (Federal)
• 120m Dynon Port Rail Link (110m Federal,
  remainder State)
• 73m Mildura line upgrade (53m State, 20m
  Federal)
• 40m Geelong Rail Access Improvement Project
• 43m in Gold line funding and freight network
  maintenance
• 501m North-East Rail Revitalisation Project
  (330m Federal, 171m State)
• 45m Seymour Sunshine crossing loop extensions
  (Federal)
• In addition
• Regional rail network buyback 134m (May 07)
• Rail Freight Support Package 20m (Feb 08)
• Total 1 billion in rail freight investment

12
Opportunities

• Government wants rail freight to be virtuous
  upward cycle not vicious downward cycle
• trucking costs will increase driver
  shortages, fuel price, road user charges
• rail
• improves road safety
• reduces road wear and tear
• reduces fuel use and transport greenhouse
  gas emissions
• can efficiently handle large volumes

13
Opportunities

• Government working with industry, rail operators
  and infrastructure managers to
• identify rail freight opportunities eg Iluka
  mineral sands from States north-west to
  Hamilton containerised grain
• improve rail infrastructure to lower transit
  times, increase reliability and reduce costs to
  customers
• simplify rail regulatory environment to
  facilitate new entrants
• generally remove impediments to efficient rail
  operations

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Conclusion

• Government providing environment for rail
  freight
• Network buyback
• Access fee rebates for grain
• Container freight rebate
• Network investment
• Revised rail access regime
• david.hill_at_transport.vic.gov.au