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The last gap in the $9 billion freight railway linking Melbourne to Brisbane won't have to be filled for two decades because of a lack of demand, according to its chief executive.
Inland Rail CEO Richard Wankmuller said trains capable of carrying shipping containers stacked two high would not be able to travel along the last 38km of the track from outer Brisbane to the Port of Brisbane.
The ability of what are known as double-stacked trains to use the single interstate rail line is one of its selling points to freighters, along with a cut in shipping time from 33 hours to less than 24 and a claimed 30 per cent reduce in cost.
Although branded as a visionary infrastructure project linking Victoria and Queensland, the government-owned railway doesn't need to upgrade the rail line from Acacia Ridge to the Port of Brisbane, Mr Wankmuller said, because there won't be enough demand for freight for many years.
AFR National Infrastructure Summit 2018. From left: Richard Wankmuller, CEO, Inland Rail; Paul Broad, CEO, Snowy Hydro; Anthea Antonio, Executive Director, Technical Delivery, Yarra Trams; Connie King, Building Operations Manager, John Holland. Peter Braig
"It will meet capacity requirements up to about 2040," he told The Australian Financial Review Infrastructure Conference in Sydney. "You have got to phase in capacity to what the market wants."
The Port of Brisbane and the Infrastructure Association of Queensland want the line extended to the port, an addition that would add $2.5 billion to a project that some economists already don't believe will ever make a positive financial return.
The railway, which will be rented to freight haulers, won't become profitable until 2062, according to a study commissioned by the government-owned Australian Rail Track Corporation. Over the next 50 years it needs a $5.7 billion government subsidy – and that doesn't include interest payments on the $8.5 billion borrowings for the construction cost.
Fifty-nine per cent of the line, which is as far as 450km inland, already exists. The tracks will be strengthened to carry heavier loads. Wooden and steel sleepers will be replaced by concrete, which doesn't expand or buckle in the heat.
Wooden sleepers on some railway bridges in Western NSW are so degraded that trains are required to slow to 20 kilometres per hour.
In a presentation to the Summit, Mr Wankmuller emphasised that the commercial success of the government-owned project would be influenced by community perceptions.
The rail line project, which only started one year ago, needs to have a positive public image to attract shippers, who at the moment mainly use trucks because rail transport is slow and inflexible.
"This is about building credibility with the public," he said. "They have to believe this is going get built and get built well. The more they can see it getting built the more they are going to take a little risk [as customers]."
Mr Wankmuller was chief executive of Cardno, an engineering firm, for 14 months until August, 2016. He was previously US head of rival GHD.
This article first appeared on www.afr.com
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