MONTREAL (Reuters) - Canadian National Railway Co (CNR.TO) has moved 50 percent more crude oil by rail during the third quarter to date, compared with the same period a year earlier, and the company sees further growth, CN’s chief financial officer said on Wednesday.
Ghislain Houle, CFO of Canada’s largest railroad, told the Morgan Stanley Laguna conference that CN is locking in customers with multiyear contracts “at very favorable” rates.
“If you look at crude by rail in right now quarter-to-date in Q3, we’re up 50 percent versus last year,” Houle said, noting that it is on a revenue per ton mile (RTM) basis.
“There’s more demand than actually what we’re providing today, but we’re being prudent,” he said.
Houle said the Trans Mountain pipeline decision has “added years to crude by rail,” a reference to a Canadian court’s recent decision to overturn approval of the project’s expansion.
The Trans Mountain expansion would have nearly tripled capacity on an existing line from Edmonton, Alberta, to a port in the Vancouver area for export. It was approved by the federal government in 2016.
Reuters reported last week that Canadian oil producer Cenovus Energy (CVE.TO), signed a deal to move more crude with CN.
Reporting By Allison Lampert; Editing by Marguerita Choy