Canadian National eyes East Coast ports for new intermodal traffic NEWSWIRE

NEW YORK — Canadian National’s strategy to rely on the American consumer to help fill up its railroad east of Chicago just got bigger.

CN has been aiming to turn the Port of Halifax, Nova Scotia, into the Port of Prince Rupert of the East, an uncongested gateway for international containers to reach the U.S. Midwest.

Now added to the plan: A new big ship container port proposed for Quebec City.

“We think there’s room for two such terminals on the East Coast: one in the St. Lawrence River, one in Nova Scotia,” CN CEO JJ Ruest told an investor conference today.

The Quebec Port Authority on Tuesday announced a partnership to develop the $775 million Laurentia container port on the St. Lawrence with CN and global terminal operator Hutchinson Ports.

The new container facility would have “big ship, big train” efficiencies similar to Prince Rupert, British Columbia, Ruest says. Containers would move directly from ships to trains, and the facility will be able to launch long double-stack trains to Toronto and the U.S. Midwest.

Prince Rupert is the fastest-growing container port in North America, with most of its traffic bound for the U.S. Midwest on CN stack trains. The balance of the traffic moves to Canadian markets via CN, the lone railroad to serve the port.

CN’s route from Chicago through Toronto and Montreal to Quebec City and Halifax has plenty of capacity to handle additional traffic, Ruest says.

Singapore-based PSA International this month was selected as the new operator of the Halterm Container Terminal in Halifax, beating out a joint bid from CN and partner CMA-CGM. The Halifax Port Authority is expanding the terminal to handle two container ships simultaneously.

CN will work with PSA to help develop more container traffic at the port, Ruest says.

“One way or another we will try to make this Halifax terminal more successful to the middle of the continent,” Ruest says.

CN officials have said Halifax would land some traffic that currently heads to the Midwest via the Port of New York and New Jersey. It was unclear whether the Quebec City port would siphon traffic away from Montreal, which relies on smaller ships.

Ruest spoke at Bernstein’s 35th Annual Strategic Decisions Conference.