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Review Panel Established for Proposed CN Logistics Hub

December 9th, 2016

Canadian Minister of Environment and Climate Change Catherine McKenna and the Chair of the Canadian Transportation Agency (CTA) Dr. Scott Streiner have announced the establishment of a three-member panel to review Canadian National Railway’s (CN) proposed Milton Logistics Hub Project in Ontario. The project, located in Milton, Ontario, about 50 km west of Toronto, would include a railway yard with more than 20 km of track.

The Minister has appointed Lesley Griffiths as the Chair of the Review Panel and Dr. Isobel Heathcote and William McMurray as panel members. McMurray is a member of the CTA and has been assigned by the CTA Chair to decide whether the proposed rail construction should be approved under section 98 of the Canada Transportation Act.

The Agreement to Establish a Joint Process for the Review of the Milton Logistics Hub Project establishes the mandate and authority of the Panel, as well as the procedures and timelines for the conduct of the review. The Panel will conduct an assessment of the environmental effects of the project; consider Aboriginal tradition, comments received from the public and mitigation measures; conclude whether the project is likely to cause adverse effects; and identify required follow-up programs.

Information will be gathered to assist the CTA in its assessment of the reasonableness of the location of the new rail lines, the requirements for the railway operations and the interests of the localities that could be affected by the lines.

Alstom to Supply 20 MP14s to Paris Metro

December 9th, 2016
Alstom's MP14 for the Paris metro. Photo: courtesy of Alstom Design & Styling.

Alstom's MP14 for the Paris metro. Photo: courtesy of Alstom Design & Styling.

Alstom will supply 20 MP14 metros consisting of 6 cars each to Régie Autonome des Transports Parisiens (RATP) and Autorité Organisatrice des Transports d’Ile-de-France (STIF), which will both fund 50 percent of the order. The contract is worth 163 million euros.

The order is part of an option exercise of the MP14 framework contract signed in January 2015 between the RATP (mandated by the STIF and the SGP) and Alstom for the delivery of up to 217 MP14 trains over 15 years for a total amount of over 2 billion euros.

“Alstom is delighted to receive an additional order for this material, which will mobilize the entire French railway industry,” said Jean-Baptiste Eyméoud, Alstom France general director. “This metro contains numerous innovations, in particular related to reductions in energy consumption and total cost of ownership.”

The MP14 trains will be placed into service on Paris line 4, increasing the capacity and quality of transport on the line, with a targeted global service equivalent to that of line 1. The trains have been redesigned to enable full passenger circulation and feature air conditioning and audio-visual information, LED lighting and video protection. The material for the new trains represents a 20 percent reduction in energy consumption compared to the previous generation. The trains have 100 percent electric braking that recovers energy that is put back into the electrical system.

The vehicles will be manufactured at the seven Alstom France manufacturing sites.

Texas Central Appoints New Executives

December 9th, 2016

The Board of Directors of Texas Central Partners, LLC (Texas Central), the company developing a new high-speed train that will connect North Texas, the Brazos Valley and Houston, has named Carlos F. Aguilar chief executive officer of Texas Central and its subsidiaries, effective December 12, 2016. Tim Keith will be president, leading capital raising and external affairs.

“Carlos brings a significant mix of construction management and engineering experience, making him an ideal fit for our team as we move forward on this transformational project,” said Richard Lawless, chairman of the Texas Central board. “He has proven a leadership record in the management of large-scale infrastructure projects and has excelled in the energy, transportation and rail industries. We look forward to his many contributions as we continue to set the pace on providing a new and much-needed transportation alternative.”

Aguilar, formerly a senior vice president at the engineering company of CH2M Hill, has a background in industrial and infrastructure work. At CH2M, he served on its management committee and was chairman of the CCPP Project Consortium for the Ichthys LNG Facility. Prior to CH2M, he was president of BrightSource Construction Management and senior vice president at BrightSource Energy. Aguilar led the development, engineering, procurement and construction of the company’s portfolio of projects, including the development and construction of Ivanpah Solar Electricity Generating System.

Aguilar held several leadership roles at Bechtel Corp., including principal vice president, Bechtel Power Corp.; president, Bechtel Financing Services; and COO of Bechtel’s United Infrastructure Company. He also served as regional operations manager, chief engineer and environmental officer for the private sector equity and financing arm of the InterAmerican Development Bank Group.

Aguilar earned a Bachelor of Science degree in engineering, mechanical engineering and materials science from Duke University, a Master of Science degree and a Doctor of Philosophy degree in technological economics from the University of Stirling in Scotland.

“The Texas Central project is a once in a lifetime opportunity to develop the country’s first true high-speed train and I look forward to leveraging the great team in place and excited to be a part of it,” stated Aguilar. “This is a project that not only will address the state’s growing transportation demands but also will provide an economic catalyst and jobs in local communities for generations to come.”

Tim Keith has served as the Texas Central CEO For the last 16 months, where he was responsible for managing the development phase of the project, which included planning, government relations, public and business community engagement; regulatory processes; and the raising of equity capital. He will continue as Texas Central president, reporting to Aguilar and will focus on capital markets and financing, operations and external affairs.

Keith stated, “I’m proud to be part of this innovative project with the tremendous progress we have made and look forward to partnering with Carlos and using his experience to accelerate the pace of the overall project development.”

Alstom’s Citadis Spirit LRV Begins Testing in Ottawa

December 8th, 2016
Testing of Alstom’s Citadis Spirit in Ottawa. Photo: courtesy of Alstom.

Testing of Alstom’s Citadis Spirit in Ottawa. Photo: courtesy of Alstom.

Dynamic testing has started for Alstom’s Citadis Spirit light rail vehicle (LRV) on the O-Train Confederation Line in Ottawa, Ontario. The LRVs will be tested at the Belfast Yard Storage and Maintenance Facility and along four km of test track.

The trains will undergo various tests, including dynamic testing at speeds of 80 km/h to 100 km/h. Track testing of the vehicles will include traction and braking performance, train behavior, and comfort and performance of the bogies. Static testing will take place at Belfast Yard to validate function performance, including HVAC, doors, lighting, passenger information and on board data systems. More than 50 test procedures will be completed in this phase of testing, which will run until the end of March 2017. Upon completion of this first series of tests, more than a dozen tests will be conducted on a multiple unit train, with two trains coupled together.

Alstom is supplying 34 Citadis Spirit LRVs for the O-Train Confederation Line, which will be run by OC Transpo, the urban transit service of the City of Ottawa. Alstom will maintain the vehicles and the line’s infrastructure for a period of 30 years. The first phase of the O-Train Confederation Line comprises 13 stations along a 12.5-kilometre route, with 10 kilometers running at ground level and 2.5 kilometers underground. The line is expected to begin full revenue service in 2018.

Witnessing the train’s first tests were Member of Parliament for Ottawa South David McGuinty, on behalf of the Minister of Infrastructure and Communities, the Honorable Amarjeet Sohi; Provincial Minister of Transportation and Member of Provincial Parliament for Vaughan, the Honorable Steven Del Duca; City of Ottawa Mayor Jim Watson; Managing Director for Alstom in Canada Angelo Guercioni; and other dignitaries.

“The commencement of dynamic testing marks the first 100% low floor vehicle to enter validation testing in Ontario and brings the Citadis Spirit one step closer to the start of commercial service in the City of Ottawa,” said Guercioni. “This rigorous testing of the trains will ensure smooth and safe operation for both the operators and passengers alike.”

The Citadis Spirit is based on Alstom’s Citadis range of LRVs and is customized for the needs of the North American market, including operation in temperatures as low as -38°C. The Citadis Spirit features a 100 percent low floor design, offering easy accessibility from the street or the curb, and an interior layout that provides a safer experience. The vehicle can provide both light rail service, including urban service in cities running at grade and in mixed traffic, and suburban service on segregated rail infrastructure at speeds up to 100 km/h.

The Citadis Spirit is being assembled by a local workforce at Belfast Yard with the support of an established supply chain of over 60 Canadian suppliers to meet the 25 percent Canadian content requirement. The Alstom manufacturing facility in Sorel-Tracy, Quebec, is assembling the bogies for the vehicles.

Final EIR Certified for LAX Metro Connector Transit Station

December 8th, 2016

The Los Angeles County Metropolitan Transportation Authority (Metro) Board of Directors has voted to certify the Final Environmental Impact Report (FEIR) for the Airport Metro Connector 96th Street Transit Station. The transit station will be added to the Crenshaw/LAX Line, which is currently under construction, and will provide an easy transfer to a future Automated People Mover (APM) that will connect to the LAX passenger terminals.

The transit station will be the new “gateway” to LAX for transit riders and will be served by the Metro Green and Crenshaw/LAX Lines. The station will feature three light rail platforms, a bus plaza, a pick-up/drop-off area coming by private vehicle, a bicycle hub, amenities for pedestrians and a Metro hub/terminal building that will provide the connection to the people mover.

Metro Board Chair John Fasana said, “Today’s action speaks volumes in terms of connecting our entire rail system with LAX – one of the busiest airports in the United States and a major employment center in Southern California. Getting this report certified means we can now design the station and then build it.”

The APM is being planned and will be built and operated by Los Angeles World Airports (LAWA), with Metro and LAWA working cooperatively on the two projects. The Crenshaw/LAX light rail project is being built by Walsh/Shea Corridor Constructors, which has committed to completing the project to allow rail service to begin in the fall of 2019.

“This is a shovel ready project, funded by Measure M that can now proceed toward the construction stage,” said Phillip A. Washington, Metro CEO. “In fact, as part of their commitment, the contractors working on the Crenshaw/LAX line are well on their way to delivering accommodations for the future Airport Metro Connector 96th Street Transit Station.”

FTA Updates House Panel on WMATA Oversight

December 8th, 2016
Welbes testifying before the House panel. Photo: courtesy of FTA.

Welbes testifying before the House panel. Photo: courtesy of FTA.

In an update to the U.S. House Oversight and Government Reform panel, the Federal Transit Administration’s (FTA) Executive Director Matthew Welbes has stated that the Washington Metropolitan Area Transportation Authority (WMATA) is implementing needed safety changes to its Metrorail system, but it must do more. The FTA assumed temporary and direct safety oversight of WMATA Metrorail in October 2015 due to serious incidents and safety lapses at WMATA, and the shortcomings of the Tri‑State Oversight Committee’s (TOC) oversight and enforcement authority.

“While FTA has seen improvements at WMATA, significant work remains to bring the Metrorail system into a state of good repair, develop and improve WMATA’s safety culture, and improve WMATA’s financial outlook,” Welbes said to the panel. “WMATA must continue to prioritize safety over service, and commit to providing customers and workers with the assurance that their safety is the first priority.”

Welbes noted that the WMATA leadership has taken significant steps in prioritizing safety over revenue service, pointing out, however, that “establishing and ensuring an enduring safety culture is the critical task ahead.”  He also noted that the FTA’s oversight role is temporary and will continue only until the District of Columbia, Maryland and Virginia set up a new State Safety Oversight Agency (SSOA) for WMATA to replace the TOC, which did not effectively respond to critical Metrorail safety oversight issues.

The FTA’s safety directives have guided WMATA prioritization of SafeTrack work to locations where urgent repairs were most required to reduce the risk of smoke and fire events, with WMATA correcting numerous degraded fire and life safety equipment in tunnels that affect emergency passenger evacuations. Welbes pointed out that the SafeTrack repairs are necessary and long overdue, and that once made, “they must be sustained with a long-term preventative maintenance plan as well as a strong safety culture or else WMATA will fall right back to an unacceptable condition.”

In February 2016, the FTA informed Virginia, Maryland and the District of Columbia that they must receive FTA certification of a new state safety oversight program— including creation of a new SSOA compliant with Federal requirements— by February 9, 2017.  Failure to meet this deadline could result in withholding up to $15 million in federal transit funding from 23 communities throughout Maryland, Virginia and the District. The FTA is preparing to transition safety oversight to the new SSOA in 2017.

FEIS Completed for Baltimore and Potomac Tunnel

December 8th, 2016

The Federal Railroad Administration (FRA) has finished the final environmental impact statement (FEIS) for replacing the Civil War-era Baltimore and Potomac (B&P) Tunnel in Baltimore, Md. While Amtrak owns the B&P Tunnel, FRA leads the environmental review process in cooperation with Maryland’s Department of Transportation.

Compared to the existing tunnel’s 20-foot depth, the new tunnel would be approximately 100 feet underground, which would nearly eliminate any noticeable vibrations from passing trains.

The FEIS includes review of the Alternative 3B route. In response to the community input provided during more than two dozen meetings held over the last two years, the FRA has changed several items on the final FEIS. The ventilation plant has been relocated to West North Avenue to preserve a community garden, the number of land parcels and historic properties impacted has been reduced, proposed relocations have been decreased, and the proposal to rebuild a larger and ADA-compliant West Baltimore MARC station has been maintained.

“Rebuilding the B&P Tunnel is a significant undertaking along the Northeast Corridor,” stated U.S. Transportation Secretary Anthony Foxx. “I am encouraged by the input provided by the communities, and that much of that input led to changes to make this project better for everyone involved. This is a great example of the value that public engagement and community involvement bring to the transportation planning process.”

The review includes proposed mitigation measures to address the impacts created by the route. These measures include establishing several grant funds to support community development and recreation facilities, providing project-related job training and hiring preferences for local workers of social and economic disadvantage, implementing construction noise and vibration mitigation plans, and establishing a grant fund for historic preservation.

“This project is better because communities provided input on how a new tunnel could be built with as little impact as possible, and where there was an impact, how we can reduce it,” said FRA Administrator Sarah E. Feinberg. “The new tunnel will keep trains moving along the Northeast Corridor and create jobs in Baltimore.”

The federal government has invested $60 million for the preliminary design and environmental review for this project.

Wabtec Acquires Majority Ownership of Faiveley Transport

December 7th, 2016

Wabtec Corporation has announced the acquisition of majority ownership of Faiveley Transport S.A., a provider of systems and services for the railway industry, after purchasing the Faiveley family’s stake, which represented approximately 51 percent of the company’s shares outstanding. Wabtec acquired the family stake for approximately $212 million in cash and 6.3 million shares of Wabtec common stock. Prior to the acquisition, Faiveley Transport S.A. was a subsidiary of Faiveley Transport.

“The acquisition of Faiveley Transport is an excellent strategic fit, expanding our geographic presence, broadening our product and service capabilities, and strengthening our technology and innovation initiatives,” said Albert J. Neupaver, Wabtec executive chairman. “The combination of two rail industry leaders creates compelling growth opportunities and synergies, and strengthens the diversity of our revenue base. We’re pleased to welcome the Faiveley family as long-term Wabtec shareholders with representation on our Board of Directors.”

Wabtec is planning to launch a tender offer for the remaining public shares in December in which the public shareholders of Faiveley Transport will have the option to elect to receive €100 per share of Faiveley Transport in cash or 1.1538 Wabtec common shares per share of Faiveley Transport.

The total purchase price for 100 percent of the shares of Faiveley Transport is approximately $1.7 billion, including assumed debt and net of cash acquired. The $1.2 billion cash portion of the transaction will be funded from approximately $325 million of cash on hand, the net proceeds from a recent $750 million senior notes offering and the company’s existing revolving credit facility and term note.

The combination of Wabtec and Faiveley Transport will create a rail equipment company with revenues of approximately $4.2 billion and a presence in key transit and freight rail regions worldwide. Faiveley Transport has annual sales of approximately $1.2 billion. Wabtec expects to realize at least $50 million in annual pre-tax synergies from the combination by year three, and the transaction will be accretive to Wabtec’s earnings per diluted share in 2017.

Raymond T. Betler, Wabtec’s president and CEO, stated, “Our combination with Faiveley Transport brings Wabtec many complementary products, a strong presence in the European and Asia Pacific transit industries, and solid relationships with blue-chip, global customers.”

Faiveley Transport chairman of the management board and CEO Stéphane Rambaud-Measson has joined Wabtec as president and CEO of its Transit Group and as a corporate executive vice president, reporting to Betler. Philippe Alfroid and Erwan Faiveley were elected as new members of the Wabtec Board of Directors.

“Wabtec’s Transit Group, under the Faiveley Transport brand name, will pursue its objective to be a global leader in railway equipment and services,” remarked Rambaud-Measson. “The passenger transit business typically provides a steady flow of new projects and aftermarket growth opportunities, and we are well positioned in key global markets such as Europe and Asia Pacific.”

Including the effects of the acquisition, Wabtec updated its 2016 guidance with full-year revenues expected to be down approximately 10 percent to about $2.95 billion. Full-year, GAAP earnings per diluted share are expected to be between $3.45 to $3.50. The company expects to record restructuring and transaction-related costs of about $60 million pre-tax and a one-time effective tax rate adjustment for non-deductible transaction costs that will result in additional tax expense of about $10 million during 2016. These items equal about 50 cents per diluted share after-tax. Excluding the restructuring and transaction-related costs, and the tax-rate adjustment, Wabtec expects full-year adjusted earnings per diluted share to be between $3.95 to$4.00.

Wabtec provided preliminary information for the full year of 2017, which include the effects of the acquisition. Revenues are expected to be about $4.2 billion. Excluding restructuring and transaction-related costs, adjusted operating margin is expected to be about 15 to 16 percent, and adjusted earnings are expected to be about 8 percent higher than the company’s adjusted earnings in 2016. Wabtec will update this preliminary information when the company reports its 2016 results.

Freight Rail Improves Chicago Region Train Management

December 7th, 2016

The Association of American Railroads (AAR) has stated that freight railroads operating in Chicago are better prepared to manage rail traffic in the Chicago region due to the establishment of the Chicago Integrated Rail Operations Center (CIROC), which opened in December 2015. CIROC includes direct connections to each carrier and track views to assist employees with resolving operational issues and identifying and addressing congestion issues, reducing train delays.

According to the AAR, the railroads that make up the Chicago Planning Group and the Chicago Transportation Coordination Office established CIROC to monitor and facilitate efficient rail operations within Chicago.

“Chicago is the epicenter of the nation’s freight and passenger rail system with about 25 percent of all U.S. freight rail traffic going through the region,” stated Edward R. Hamberger, AAR president and CEO. “Freight railroads have long taken steps to identify critical factors impacting rail operations in the area. Coordination between Chicago railroads is key to achieving the benefits of the extensive planning, particularly during challenging winter weather.”

The establishment of CIROC improves Chicago-specific visibility, metrics and measurements that work as early warnings for potential problems, said the AAR, equipping railroads to communicate on an ongoing basis, review train schedules and routing protocols. It also improves the ability to have the necessary equipment, materials and personnel in place to keep trains moving.

“Operational planning and plan execution are extremely important for all railroads across the nation’s 140,000-mile rail network,” Hamberger added. “Under the new system, rail traffic issues will be better pinpointed through the CIROC’s monitoring process.”

The AAR also noted that, according to the U.S. Department of Transportation (USDOT), the volume of imported and exported goods transported via rail in Chicago is forecast to increase nearly 150 percent between 2010 and 2040.

G&W Australia Acquires Glencore Rail

December 7th, 2016

Genesee & Wyoming Inc. (G&W) has announced that G&W Australia (GWA) has completed the acquisition of Glencore Rail (GRail), which includes nine train sets (30 locomotives and 894 wagons) for A$1.14 billion. GWA also concurrently issued a 49 percent equity stake in GWA to funds and clients managed by Macquarie Infrastructure and Real Assets (MIRA).

In conjunction with the acquisition, GWA has entered into a long-term, take-or-pay contract with Glencore Coal Pty Limited (GC) to exclusively haul all coal produced at GC’s existing mines in the Hunter Valley to the Port of Newcastle, subject to existing agreements and certain limitations.

The acquisition adds a significant presence for GWA in the Hunter Valley coal supply chain and complements GWA’s existing intermodal, agricultural and mining business in South Australia and the Northern Territory.