Canadian Pacific Railway reached a new one-year agreement with Teck Coal, a major shipper of high-heat coal needed for steelmaking furnaces, to haul the fuel from Teck’s mines in southeastern British Columbia to Pacific Coast ports.
CP said terms were confidential but included freight charges “similar to current rates.” But it also said the rates are volume-based, and would rise “should Vancouver export volumes fall short of target levels.”
The companies had crafted a short-term contract last July that lowered Teck’s rates until April 7, after an arbitrator ruled the coal shipper could shift about 15 percent of the coal it sent by CP over to rival Canadian National Railway. Reports said that ruling also stopped a rail practice of tying rates to the price of coal.
The railroad also said that “during the term of this new agreement CP and Teck intend to enter discussions toward a longer term arrangement.”
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