GWA boosts locomotive fleet

To support the increased shipments under the two contracts, GWA will invest $60 million to purchase new narrow gauge locomotives and wagons as well as to construct a standard gauge rolling-stock maintenance facility.

Rail Express understands that five 2260 kW narrow gauge locomotives have been ordered from Downer Rail for delivery in March next year.

GWA currently transports approximately six million tonnes of iron ore per year over narrow gauge rail lines owned by Arrium from mines in the Middleback Ranges to Whyalla, South Australia. The amended narrow gauge contract allows for an increase in this tonnage by more than two million tonnes per year in the first half of 2013.

In addition, GWA amended the previously announced standard gauge contract to haul 3.3 million tonnes of export iron ore from Arrium’s Peculiar Knob mine, which is located near GWA’s Tarcoola to Darwin rail line. GWA has already invested $67 million for new locomotives and facilities to support shipments from the new mine, which are expected to commence in the fourth quarter of 2012.

The amended standard gauge contract increases the Peculiar Knob tonnage by more than half a million tonnes per year and also includes rights for GWA to serve other potential iron ore tenements in South Australia, including Hawk’s Nest.

President and CEO of GWA’s US parent company Genesee & Wyoming Inc., Jack Hellmann said, "We are pleased to be expanding our service relationship with Arrium to an annual run rate of 11 million tonnes by mid-2013 and looking forward to supporting Arrium’s expansion to even higher tonnages in the future.”