Brookfield asks CBH for more
Brookfield Rail has thrown down the gauntlet to CBH ahead of talks today aimed at reaching agreement on the future of WA's grain freight network.
Chief executive Paul Larsen said yesterday that Brookfield had no choice but to increase the access fees paid by the farmer-owned co-operative as part of a solution to issues surrounding the carting of grain on rail.
Mr Larsen would not reveal how much extra CBH would be asked to pay but said it was less than the ceiling cost determined by the Economic Regulation Authority under WA's Railway (Access) Code.
"The access price reflects what is necessary to deliver a self-sustaining grain freight rail network for the next 10 years," he said in a statement.
Mr Larsen said Transport Minister Dean Nalder had notified Brookfield that the State Government would not contribute any funds to the network despite the threat of some lines closing.
The Government has also refused to intervene to reopen lines known as Tier 3 which closed last year despite the findings of a parliamentary committee which criticised oversight of Brookfield's 49-year lease over the State-owned freight network.
Brookfield and CBH have been miles apart in negotiations on a long-term access deal and are now entering unchartered territory in terms of the code.
Today's talks mark the start of a window for negotiations between the warring parties under a formal process launched by CBH in December 2013.
If no agreement is reached after 90 days, an arbitrator will be appointed to determine access costs. The arbitrator's decision is binding on Brookfield, but not on CBH.
Mr Larsen said Brookfield would present CBH with a plan to provide certainty for growers without the need to seek investment from the Government.
"The proposed access fees will cover the actual annual maintenance and operating costs as well as underpinning the necessary capital investment to deliver CBH's requested operations on the rail network for the next 10 years," he said.
"It includes all capital investment in both the Tier 1 and Tier 2 lines (including the Miling line), as well as the significant upfront investment to bring the specific Tier 3 lines to which CBH has sought access back to operational capacity."
CBH said it wanted a "fair and reasonable" outcome for its grower members.
Mr Larsen said the fee increase sought by Brookfield was reasonable. An interim access deal is due to expire on April 30.
