AUSTRALIA's Toll has entered into a 13-year rail haulage agreement with Pacific National Rail (PN Rail) to take over operation of the North Queensland rail service of its intermodal business from February 1.
The agreement helps Toll improve service to North Queensland, allowing long-term access to rail infrastructure and increasing operational flexibility, said Toll Group managing director Brian Kruger.
"It also reduces capital employed in this part of the business, which will result in an improvement in our return on invested capital," he said.
The agreement with Asciano, parent company of PN Rail, follows a number of deals between them, including an interstate rail haulage contract with the railway until 2022.
The new deal will cover PN Rail's acquisition of five Queensland intermodal rail terminals for A$70 million (US$62.5 million) at Cairns, Townsville, Mackay, Rockhampton and Brisbane, together with associated plant and equipment.
Additionally, Toll Intermodal will continue to operate its forwarding business at PN Rail terminals, thus eliminating Toll's minimum rail volume obligations in North Queensland from January 1.
Most Toll employees working railway roles are expected to transfer to PN Rail.
Source : HKSG.