Rail operator resumes maintenance work

Brookfield, which operates 56 freight rail lines in WA totalling 5500 kilometres, including the Kwinana to Kalgoorlie section of the interstate standard gauge line, announced it has taken over all regular track and civil maintenance from Monday.

John Holland has been maintenance contractor for Brookfield Rail and its predecessors since the State's freight rail network was leased out in 2000 for 49 years.

Brookfield Rail said it would continue to use external contractors for major project and specialised maintenance work.

It was already responsible for signalling and communications systems maintenance.

General manager asset management and projects Paul Lowney said Brookfield had been working closely with John Holland to implement the regular maintenance responsibility transition in a "safe and considered manner".

"The transition provides genuine career and development opportunities for our current and future employees, and will help future proof Brookfield Rail for long-term growth, expansion and sustained success," Mr Lowney said.

"This move enables Brookfield Rail to be more adaptable and flexible, as well as have greater control and security over our costs, data, knowledge and intellectual property.

"We firmly believe that in-sourcing track and civil maintenance will enable Brookfield Rail to focus on improving the way we run our core business - a safe, efficient and reliable railway," he said.

Wheatbelt shire councils have long complained about the cost of civil works within three metres of Brookfield's rail lines - primarily level crossings on shire roads.

Up until Monday works on shire infrastructure involving Brookfield rail lines, such as reconstructing or asphalt resheeting of level crossings, was required to be carried out by rail maintenance contractor John Holland without opportunity for shires to put the works out to tender to obtain best prices.

The end of the mining boom is also considered to have influenced Brookfield's decision to put track maintenance costs back under its direct control.

Last year its iron ore miner customer Cliffs Natural Resources, in response to falling iron ore prices, announced it was bringing forward the proposed closure of its Koolyanobbing operations near Southern Cross to within three and a half years.

Cliffs rails its iron ore to Esperance where it makes up 75 per cent of exports through that port.

Another Brookfield iron ore customer Mineral Resources, which currently rails its ore from the Carina mine - also near Southern Cross - to Kwinana on the higher-cost main standard gauge line, is understood to be considering railing its ore at lower cost to Esperance once Cliffs pulls out.

Long-term operations of two more Brookfield iron ore customers railing to Geraldton port are also dependent on global ore prices recovering and stabilising at a sustainable level.

According to Brookfield, the iron ore miners are its biggest customers and supplied 40pc of the tonnage carried on rail in 2014, up from 17pc in 2005.

Brookfield also faces further uncertain revenue projections with the arbitration process with CBH Group set to determine a fees schedule for grain trains covering the next 10 years.

Conducted in strict secrecy, the process allows arbitrator Kevin Lindgren QC to determine the fee schedule if CBH and Brookfield fail to agree.

If the arbitration process looks like dragging on beyond the December 31 sunset clause in the existing grain trains arrangement, CBH can ask Mr Lindgren to extend interim provisions.

Grain carting comprised 12pc of Brookfield's business in 2014, down from 17pc in 2005.

Since the State's freight rail network was leased out in 2000 the annual tonnage carted on rail has increased 138pc from 31 million tonnes to 74mt.