KCS, CN offers first looks at 2023 capital plans

BOCA RATON, Fla. — It is probably no surprise that, as Kansas City Southern’s north-south main line becomes a focal point in its pending merger with Canadian Pacific, that route is also front and center in its capital spending plans for 2023, as well.

A number of capacity projects on that route figured in the 2023 capital plan presented by Steve Raiche, assistant vice president construction and engineering, in the latter stages of Friday’s presentations at the National Railroad Construction and Maintenance Association Conference.

Also presenting in the late stages of Friday’s program was Canadian National.

After focusing about 75% of its capital spending in Mexico for several years, that percentage moved back into the U.S. in 2022, Raiche said. The focus on capacity work in the U.S. will increase even more in 2023, he said, with the railroad doubling its budget for special projects, while the maintenance-of-way budget remains roughly equal.

Those special projects call for four siding extensions between Kansas City and Shreveport, La., and another three south of Shreveport. There will also be mainline alignment and yard improvement projects near Kansas City.

“We’re shifting from Houston to Kansas City,” Raiche said. “That’s going to be our main corridor spend for siding extensions, new sidings, for the next two or two three years.”

In Mexico, the key projects will mainly be in three areas: new sidings and a siding extension near Monterrey; a double-track bridge and siding extension near San Luis Potosi, and the Celaya bypass, a 21-kilometer line around its namesake community requiring six overpasses, four underpasses, and numerous grade crossings.

The link between those two parts of the capital plan, as well as the system, is the new International Bridge in Laredo, a second span paralleling the railroad’s existing U.S.- Mexico crossing. Groundbreaking ceremonies were held Oct. 31 [see “KCS breaks ground for second span …,” Trains News Wire, Nov. 1, 2022]; construction will begin in earnest shortly.

“We had 25 permits to get for this … 25 permits in the U.S., 25 permits in Mexico,” Raiche said. “A lot of time and effort put into getting permits. … It takes forever when you’re crossing an international border. This one took us two years; we finally got our last permit yesterday, so we will start construction shortly.”

Raiche appealed to the contractors on hand to help address the railroad’s needs on two fronts.

“I know everybody’s a U.S. contractor here, but if you have partners and suppliers that have things we are looking for a lot of material coming into Mexico,” he said. Similarly, he said later, the railroad is facing some challenges on its projects south of Kansas City, after a lengthy period of focusing on work in the Houston area.

“We know south Texas contractors,” Raiche said. “Our north-south run, we don’t have the contractors, because we haven’t been there for years. So my ask for all of you is we need contractors, big time, to work that corridor. We are struggling to do that, because the south ones don’t want to come to the north. So we are actively looking for folks to help us build all these projects.

“We’ve got a lot more planned after this year and next year — a lot of things happening on the north-south corridor.”

CN capital budget to be ‘slightly larger’ in 2023

With Canadian National’s capital plan still awaiting approval at the board level, Brent Laing — the railroad’s vice president, engineering, offered a relatively bare-bones look at 2023 plans, which he said would be “slightly larger” than 2022’s capital program.

Basic planning calls for replacement of 370 miles of rail and 1.4 million ties, along with replacement or rehabilitation of 162 bridges, 466 miles of track surfacing, and renewal of 597 grade crossings. “We look to be targeted in how we spend our money, and very judicious in our application,” Laing said. “We’ll work very closely with our contractor and supplier base.”

Special capital work — addressing capacity improvements, such as siding projects — tentatively will include approximately $100 million on eight projects in CN’s western region, $80 million on three projects in the eastern region, and $50 million on capacity and yard projects in the southern region. “I expect these projects will be tendered fairly shortly to ensure deliverly of the projects to my transportation partners as quickly as possible,” Laing said.

Laing has been in his position at CN for about six months, after six years out of the industry. Before that, he had spent more than 30 years with Canadian Pacific. Asked what had him excited about his return, he said, “For me, it’s really the people. I think people are very engaged; they want to do the right thing. If we provide that good vision of where we want to take the railroad, that’s very important … I’m thrilled to be back.”