Canadian National Railway has suspended the feasibility study for the construction of its proposed rail line and terminal handling facility to serve the Quebec/Labrador iron ore range.
The feasibility study was initiated in August 2012 by CN and its partner La Caisse de depot et placement du Quebec, along with six mining companies.
“Current market realities” have resulted in anticipated delays with mine development projects in and around the Labrador Trough, CN said in its release. A joint review of the project together with the mining companies indicates that mine construction schedules and diverging needs for each project will make it difficult to obtain the critical volume of iron ore necessary to support the building of new rail and terminal infrastructure by CN.
The decision by some miners in the region not to join the group of mining companies supporting the CN infrastructure project was also a factor in the lower-than-anticipated iron ore volume.
“We have invested considerable effort and resources towards the feasibility study, but in light of the circumstances, CN has concluded that it is not advisable to continue with the feasibility study at this time,” said Luc Jobin, executive vice president and CFO of CN, in a written statement.