MONTREAL, Feb. 12, 2013 /CNW Telbec/ - CN (TSX: CNR) (NYSE: CNI)
announced today that it is suspending 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 last August by CN and its partner La
Caisse de dépôt et placement du Québec (the "Caisse"), along with a
group of six mining companies. The study has been progressing steadily
over the past several months. However, the current market realities
have resulted in anticipated delays with mine development projects in
and around the Labrador Trough. A joint review of the project together
with the mining companies indicates that mine construction schedules
and diverging needs for each specific individual project will make it
difficult to obtain the critical volumes 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 is also a
factor in the much-lower-than-projected iron ore volumes that are now
expected to be shipped in the foreseeable future.
Luc Jobin, executive vice-president and chief financial officer of CN,
said: "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."
Michael Sabia, President and Chief Executive Officer of the Caisse,
added that "we understand that conditions in the global economy prevent
undertaking the project at this time. As a long term investor, the
Caisse remains open to participating in infrastructure projects that
will facilitate the development of Northern Québec, always in
partnership with an experienced partner that can minimize the
operational risks. The Caisse is convinced that the long-term
structural trends in the global economy will be favorable to the
development of Québec's natural resources sector."
CN - Canadian National Railway Company and its operating railway
subsidiaries - spans Canada and mid-America, from the Atlantic and
Pacific oceans to the Gulf of Mexico, serving the ports of Vancouver,
Prince Rupert, B.C., Montreal, Halifax, New Orleans, and Mobile, Ala.,
and the key metropolitan areas of Toronto, Buffalo, Chicago, Detroit,
Duluth, Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul,
Memphis, St. Louis, and Jackson, Miss., with connections to all points
in North America. For more information on CN, visit the company's
website at www.cn.ca.
Forward-Looking Statements
Certain information included in this news release constitutes
"forward-looking statements" within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and under Canadian
securities laws. CN cautions that, by their nature, these
forward-looking statements involve risks, uncertainties and
assumptions. The Company cautions that its assumptions may not
materialize and that current economic conditions render such
assumptions, although reasonable at the time they were made, subject to
greater uncertainty. Such forward-looking statements are not guarantees
of future performance and involve known and unknown risks,
uncertainties and other factors which may cause the actual results or
performance of the Company or the rail industry to be materially
different from the outlook or any future results or performance implied
by such statements. Important factors that could affect the above
forward-looking statements include, but are not limited to, the effects
of general economic and business conditions, industry competition,
inflation, currency and interest rate fluctuations, changes in fuel
prices, legislative and/or regulatory developments, compliance with
environmental laws and regulations, actions by regulators, various
events which could disrupt operations, including natural events such as
severe weather, droughts, floods and earthquakes, labor negotiations
and disruptions, environmental claims, uncertainties of investigations,
proceedings or other types of claims and litigation, risks and
liabilities arising from derailments, and other risks and assumptions
detailed from time to time in reports filed by CN with securities
regulators in Canada and the United States. Reference should be made to
"Management's Discussion and Analysis" in CN's annual and interim
reports, Annual Information Form and Form 40-F filed with Canadian and
U.S. securities regulators, available on CN's website, for a summary of
major risks.
CN assumes no obligation to update or revise forward-looking statements
to reflect future events, changes in circumstances, or changes in
beliefs, unless required by applicable Canadian securities laws. In the
event CN does update any forward-looking statement, no inference should
be made that CN will make additional updates with respect to that
statement, related matters, or any other forward-looking statement.
SOURCE: CN
