Businesses will need to commit to rail now or venture will fail

Source: Gisborne Herald – Friday 28th November 2014

News this week that KiwiRail has conditionally agreed to lease the Napier to Gisborne rail line to the Hawke’s Bay

Regional Council, and that HBRC will now commission a business case analysis for a proposed short-haul rail operation,

is exciting for all those who want the line reopened.

The developments are testament to the efforts and passion of the six men behind the Napier-Gisborne Shortline Rail

Group, including Gisborne transport operator Steve Weatherell – who was instrumental in getting loads of squash railed

south before the washouts that led to the line being mothballed two years ago.

Their confidence in the future prospects of rail for our two regions will now be tested over the next three motnhs. HBRC

and other potential investors, as well as KiwiRail, will want to see significant freight commitments for the line – not just

hopes and sincere intentions.

It is a reasonably tight timeline and it needs to be as the rail corridor is a significant asset that has lain idle for too long.

HBRC has already shown its support for reopening the rail line by setting aside $5.5 million to invest in this venture – which

its proponents say will need another $10-12m of private funding – in its draft long-term plan. Public consultation on that

decision is yet to take place and will need to follow the due diligence process, which HBRC wants completed by end of

February.

KiwiRail has given HBRC until March 1, 2015 to respond to the lease offer. That appears to be a deadline for completion

of the business case, and the council indicating its position, rather than an actual agreement. A deadline of June 30, 2015

has been set for the project by the regions’ mayors, which ties in with the completion of council long-term plan processes.

Hawke’s Bay and Gisborne businesses with potential freight transport needs will be visited once again and, if they want

to see the rail line reopened, they should sign on the dotted line. It will take lots of freight to make this venture work, and

if that is not forthcoming this proposal won’t get off the ground.

Labour MP’s Whaitiri, Nash ‘delighted’ at decision to lease rail line

Source: Gisborne Herald – Thurs 27th November 2014

KiwiRail’s decision to allow the Hawke’s Bay Regional Council (HBRC) to lease the Napier to Gisborne rail line is welcomed

by Labour’s East Coast Members of Parliament Meka Whaitiri and Stuart Nash.

Mrs Whaitiri, MP for Ikaroa-Rawhiti, said world-class transport infrastructure was vitally important to attracting industry to

the region.

“If we are ever going to provide jobs and opportunities to our people up and down the Coast, then we need to attract the

type of industry that processes raw commodities like logs and foodstuffs.

“These are the type of industries that need reliable access to a containerised export port.”

Tauranga was 400 kilometres and the Port of Napier 200km from Gisborne.  Reopening the line is a long term commitment

to the region and makes sound economic sense.”

Reopening the rail line was something she and Mr Nash, the MP for Napier, campaigned hard on during this year’s General

Election.

A significant number of people within the region understood the economic proposition that rail brought to the district.

“We are delighted by this decision and are both confident the HBRC will end up being the saviour of this important piece of

regional infrastructure,” said Mrs Whaitiri.

Mr Nash said leasing the line to HBRC, was an innovative approach to an issue, which had polarised the East Coast.

“This is a fantastic opportunity for us to now take control of our own future. If the HBRC, can make it work, then this is a

fantastic outcome for those who understand the value proposition that rail provides.”

Rail back on line…

Source: Wairoa Star – Tuesday 25th November 2014

KiwiRail agrees to lease.

KiwiRail has agreed to lease the mothballed Napier to Gisborne rail line to Hawke’s Bay Regional Council.

After nearly two years of regional pressure the lease offer has finally been made, subject to a number of conditions.

The line was mothballed in December 2012, after storms earlier in the year caused severe damage, particularly

around the Beach Loop area on the Northern side of the Wharerata hills.

Repairs are expected to cost close to $4 million.

The next step is for the regional council to consider KiwiRail’s offer to see if it makes sense as an investment.

It has until March 1, 2015 to respond to KiwiRail.

Hawke’s Bay Regional Council chairman Fenton Wilson is excited KiwiRail has given the council and the East Coast

this chance.

“Our challenge now is to seek regional council endorsement to spend some money on due diligence which will

include geo-technical work on the washout and a final engineering inspection and report.  Then we will review the

Napier-Gisborne Railway business case to ensure the numbers are accurate and realistic.

“We have another monthly meeting in three-weeks and I would hope in that time we would have the beginnings of

the answers to many of these issues,” said Mr Wilson.

“The main news is that KiwiRail has given us a chance. There’s a lot of work to do in a short time-frame to meet

their deadline.”

“With regard to the Gisborne Distrcit Council we have not had any formal discussion about what the final funding

arrangements might look like.”

“I’m sure they are talking to their major businesses about what success looks like though.”

The regional council will meet tomorrow to discuss the proposal.

Wairoa Mayor Craig Little described the announcement as fantastic news”.

“Providing the offer is viable then this is a great way to get the ball rolling.

“This is the outcome the regional leaders wanted when we all met in Wairoa with potential line users earlier this month.

“There is no reason why the Wairoa to Napier part of the line can’t begin operating again straight away.

“For us that could mean a land-based road/rail hub or port based in Wairoa.”

Mr Little hoped the KiwiRail offer was a fair one and that KiwiRail passed on the same opportunities to the regional

council that they had received themselves.

Napier-Gisborne Railway Shortline Establishment Group chairman Don Selby said the consortium welcomed this

progress and hoped the regional council sees fit to follow it through.

“There’s a lot of planning and organisational work to do and we are just waiting for the green light.”

“We are still very keen to get on with the job and provide the area with a reinstated rail service,” Mr Selby said.

MP ‘extremely happy’ at news …

Wairoa-Napier Member of Parliament, Stuart Nash said this was great news.

“The fact that KiwiRail is prepared to think outside the box and explore partnerships with engaged local authorities

who have skin in the game is a real bonus for the East Coast.”

“While it isn’t a certainty that the Regional Council will reopen the Napier-Gisborne rail link, the East Coast has been

given a lifeline and I am extremely happy that this option is now able to be worked through.”

“I am 100 per cent supportive of this iniatiative,” Mr Nash said.

Council to spend $250k on Napier-Gisborne rail

Source: Hawke’s Bay Today – Tuesday 25th November 2014

by Simon Hendery    simon.hendery@hbtoday.co.nz

New life has been breathed into the campaign to reopen the Napier-Gisborne rail link with KiwiRail offering to lease the damaged line to Hawke’s Bay Regional Council.

The council is tomorrow expected to approve spending $250,000 to develop a business case to re-establish a freight service on the line.

A private sector investment of about $10 million to $12 million would then need to be found on top of a $5.46 million provision the council has earmarked for the project in order for it to get off the ground.

Earlier this year, the council asked the Government to repair the damaged line – at an estimated cost of between $3.7 million and $4.5 million.

The council was approached by the Napier-Gisborne Railway Shortline Establishment Group (NGR) who wanted it to become a shareholder in a rail freight operating business using the line.

But the Transport Minister at the time, Gerry Brownlee, refused the request for funding, saying the council’s plans to see the line put back into service did not make economic sense.

However, in a letter to the council last week, KiwiRail chief executive Peter Reidy said the company was willing to lease the line to the council, but would not commit any funding to the work required to reopen it, or for ongoing maintenance.

KiwiRail has given the council until March 1, to finalise its business case for the line, after which, Mr Reidy said in his letter, the company “will need to resume its process to lease the line for alternative uses, or fully close (it)”. The line has been mothballed since late 2012.

Under a “revised proposal” from NGR, to be considered at tomorrow’s council meeting, the rail group suggests paying the council up to $300,000 a year to sub-lease the line, depending on the cost of repairs.

Councillor Alan Dick, chair of the regional transport committee and an advocate for the re-opening of the rail line, said the revised NGR proposal reduced the risk for the council taking a stake in the freight business.

The group was confident it could raise the capital required to acquire locomotives, rolling stock and other assets to get the business up and running, but was looking to the council to be an “infrastructure provider” through the KiwiRail leae, Mr Dick said.

“There’s a lot of work to be done and there are some challenges but we’re confident that we can get there.

Napier Labour MP Stuart Nash, an advocate for re-opening the line, welcomed KiwiRail’s move to offer to lease it to the council. He said the company’s decision “recognises the tenacity and persistence” shown by Mr Dick, NGR and other rail supporters.

“I’m delighted by this decision and I am confident the HBRC will end up being the saviour of this important piece of regional infrastructure,” Mr Nash said.

Earlier this month the mayors of Napier, Hastings, Wairoa and Gisborne agreed to fully support the regional council’s efforts to secure a lease of the rail corridor.

At the same time, Parliament’s Transport and Industrial Relations Committee is considering a request to fund a feasibility study into the possibility of converting the rail corridor into a tourist cycling trail.

The history and costings

Source: Wairoa Star Thursday 20th November 2014

 
The mothballed Napier-Gisborne rail line is the northern section of the Palmerston North/Gisborne line. It was built in the

period from the 1920’s to 1940’s and opened in 1943. It was one of the last main line rail constructions in New Zealand and built

to high engineering standards.

In March 2012 the line was damaged in the Beach Loop area with four washouts over a 4.7km section.

Repairing the culverts would cost $3.30m to $4.29 million with the Big Hut slip the most expensive at $750,000-$950,000

and expected to take six to nine weeks to complete. Repairing the south end tunnel was estimated at between $670,000-$870,000

and could take up to 10 weeks.

The May 18, 2012 KiwiRail Napier-Gisborne Line report said all four washouts occurred because culverts were inundated with flood

debris.

At the time of the weather event in March 2012, the culverts in this section of track were code-compliant and were last maintained

in May 2011, according to the report.

Detailed culvert inspections were performed once every six years and focused on the structural integrity of the culvert, inlet and

outlet. The detailed inspection also looks at the stream condition as well as blockages and debris build-up. The detailed inspection

was supported by a weekly track inspection.

After a severe weather event a special inspection was carried out in the affected area. The report concluded that because of the

susceptibility and climate inspections could be annual rather than six-yearly.

This would add a further $6000 to the inspection cost per year. The maintenance work found from the extra inspections was

estimated to cost between $40,000 and $70,000 per year.

The KiwiRail report recommended reducing line washouts due to slips and dropouts by undertaking prudent engineering works.

It said the Wairoa to Gisborne section was more vulnerable than the Napier to Wairoa section and this was reflected in the repair

estimates. In this section alone there were at least 13 embankments of similar height to those that failed and might pose a similar

risk of embankment collapse due to upstream ponding.

It noted another high-risk area needing significant work was the section of the line alongside the Kopuawhara River. A combination

of river protection, slope stability and drainage work was required along this stretch of the corridor. Removing these risks was costed

at between $0.8m to $1.5m.

The KiwiRail repair bill included a nominal amount for the Napier to Wairoa section to acknowledge there were many rivers that the

railway ran close to.

Taking into account past history, the report said major infrastructure outage due to weather every two to four years could be

expected on this line. The geography of the line made it difficult to eliminate damage against such events.

But the report stated improvements at risk areas and maintaining drains, culverts and slopes after severe weather events would limit

damage.

Getting back on the rails

Source: Wairoa Star Thursday 20th November 2014

The future use of the mothballed Napier-Gisborne rail line has inspired a road deviation proposal, a private rail shortline consortium and rail bike proposals.

Now another player in the transport world has suggested utilising part of the line could be more productive than reinstating the whole line.

In a discussion document submitted to the Hawke’s Bay Regional Council on its ‘Big Six’ strategic priorities, Napier Port chief operating officer Chris Bain said any rail infrastructural improvements should be demand-tested with a strong emphasis on Napier-Wairoa.

“If there is any case for sustainable rail capacity investment Napier-Wairoa cargo opportunities are likely to comprise proportionately more of the cargo than those of Gisborne origin.”

“In other words, Napier-Wairoa cargo opportunities may more readily meet return-on-investment criteria where the addition of Wairoa-Gisborne coverage may not,” he said.

He saw forestry product as the prime opportunity saying whoever operated the rail needed to make a compelling case to log exporters to have the freight moved by rail instead of only by road.

“The case for change means moving from 100 percent road use to a mix of road and rail. Additional handling costs transferring product to rail will need to be overcome.”

He said the journey between Wairoa and Napier was apparently hard on trucking gear and there may be economic sense to using rail from Wairoa to the Napier Port.

“The key issue is whether there’s sufficient committed cargo for the sustained use of rail. If there is, a Wairoa hub may be possible.”

“It could mimic similar rail-based operations which serve ports, such as in Wanganui,” Mr Bain said.

Hawke’s Bay Regional Council chairman Fenton Wilson said the Wairoa-Napier link was the easy step, but in reality long-term success of the service depended on the Gisborne link.

“This enables the resumption of containers and other bulk products, not just logs, which is the main Wairoa opportunity.”

“The unanimous support from the mayors supporting the regional council in its ambition to lease the line is encouraging.”

Chairman of the Hawke’s Bay Regional Transport Committee Alan Dick said there was evidence the line was viable in the long-term, if it operated between Napier and Gisborne because the Gisborne containerised produce and other trades were growing substantially.

“This will supplement the log harvest, which will be intense for the next 10-12 years, but is expected to decline to lower levels after that until the next harvest cycle.”

“This ensures we don’t put all our eggs in one basket and means the line is more sustainable,” Mr Dick said.

Another proposal to create a deviation for State Highway 2 along part of the mothballed rail corridor was also discussed at the regional leaders’ meeting in Wairoa earlier this month.

Spokesman for the group, local farmer Rex McIntyre said they had received a positive response in Wairoa and from most Gisborne transport operators since they floated their proposal at the leader’s meeting.

The former Hawke’s Bay Regional Council and transport committee chairman said people were keen to find out more details and how it could work.

The new route from Sandy Creek to Eskdale would open up two tunnels and include a new viaduct near the existing   Waikoau rail viaduct as well as another new viaduct at Waikare and a bridge over the Esk River.

Mr McIntyre said trucks made “just-in-time” economics possible for East Coast businesses and delivered everything from big warehouses to local businesses in a tight timeframe. The gains made in fuel and time savings from the alternative route were greater than the cost of the $12.50 levy, he said.

Other improvements on State Highway 2 could include a Waihua Bridge upgrade so it could take the heavier class of transport; and an elimination of Ohinepaka overbridge and upgrades for two to three bridges north of Wairoa to take a full 62-tonne container straight to the Port of Napier.

Mr McIntyre said feedback was that people saw the alternative route as an opportunity to open up Wairoa. “If there is enough support we will hold a meeting in Wairoa and make a full presentation of the proposal,” Mr McIntyre said.

They hope to arrange a meeting with the Transport Minister Simon Bridges to discuss their proposal.

Wairoa rail-hub a key benefit

Source: Wairoa Star – Thurs 6th November 2014

A Wairoa-based inland hub would bring significant benefits to the district, Napier-Gisborne Railway Short-line

Establishment Group chairman Don Selby told the region’s leaders at Tuesday’s rail corridor meeting in Wairoa.

He confirmed three private forestry companies want their logs weighed, scaled, and measured in Wairoa and

transport by rail to port. Mr Selby proposed the main traffic from Wairoa would be logs from private logging

companies to the port of Napier in the short-term, and Gisborne in the medium-term.

“Scaling and measuring the logs in Wairoa gives the private forestry companies an advantage as graded logs

could go straight to the port,” Mr Selby said.

Resurrecting the rail line also favoured future tourism ventures from both the Gisborne and Napier steam train

operators and cruise ship market. Mr Selby said there was great tourism potential with passenger services alongside

the freight and links to boutique accommodation in the region, mountain biking in the Wharerata hills, hiking in the

Mahia Peninsula, fishing and historic and cultural trails and a rail cart tourism operator who was also interested in using

the line.

The company was organising private investment funding to complement the Hawke’s Bay Regional Council’s investment.

The designate chief executive was Neil Buchanan, a civil/mechanical engineer who was employed by KiwiRail for 40

years at senior levels.

Mr Selby said the line was an asset to the region and once pulled up it would never be replaced.

He speculated the railway would quickly become profitable with freight volumes quickly rising from 250,000 tonnes

to over 400,000 tonnes per annum within six years.

If the cost of repairing the washouts was excluded, it would break even in four to five years.

The consortium had gained independent specialist advice on the condition and estimated costs of work needed for

the track, bridges and other infrastructure. Once repaired the line would need catch-up work in culvert and drain clearing,

spot sleeper replacement and forward planning for risk resilience, but was otherwise in sound condition for the next 10

years. There would be a gradual increase in maintenance needs over the following 10 years to address aging infrastructure.

The group sees the Napier Gisborne Railway as a regional venture providing improved transport infrastructure for forestry

and primary produce and was part of a growing worldwide trend of regional short lines serving businesses in their local

communities.

Long standing rail supporter Steve Weatherell of Weatherell Transport, Gisborne, said when the line was damaged it was

running at half its potential and could have been running six trains a week with the coming squash season.