Canadian Pacific building transload facility for gas industry in Taylor, Pa.

February 14, 2001 Canadian Pacific is joining the procession of railroad facility developments to handle freight shipments for the area's emerging natural-gas drilling industry, the Times-Tribune reports. Canadian Pacific, based in Calgary, Alberta, Canada, is developing a transload facility at its Taylor yard to process sand for Marcellus Shale natural gas development, CP spokesman Mike LoVecchio said.

Well-drilling
companies use large volumes of sand and water at each well site to fracture
rock and free gas for extraction.

"It
looks like we will create about 10 jobs out of this transload facility," LoVecchio
said. "The expectation is, it will move upwards of 30 rail cars of ‘frack
sand’ a week."

The
company will hire full-time yard workers and materials handlers at Taylor yard
to process the material, which will be trucked to drilling sites, LoVecchio
said.

CP’s
venture follows recent gas-extraction developments at two area rail yards.

"There’s
a lot of railroads now that are putting in facilities," said Joe Gerdes,
executive director of the Keystone State Railroad Association, a
Harrisburg-based group that represents freight carriers and short lines.
"They have found carloads that they were not expecting from Marcellus.
It’s bringing in drills, it’s bringing in pipe, its bringing in sand."

Last
month, Linde Corp., a Honesdale-based utility and heavy construction
contractor, opened a transload facility at a Carbondale yard in a joint venture
with a Texas energy development services company. The two will develop and ship
a clay-based compound that helps seal gas wells and extract drill cuttings.
Linde invested about $500,000 in the facility and leases the property from the
Pennsylvania Northeast Regional Rail Authority.

Last
year, Reading and Northern Railroad, a Schuylkill County shortline, teamed up
with a Warren County sand supplier to invest about $100,000 in a transload
development at Coxton Yard, a former Conrail property in Duryea.

Canadian
Pacific, which acquired Delaware & Hudson Railway’s assets in 1992 through
bankruptcy and has about 700 employees in Pennsylvania and New York State, sees
possibilities for new business in the developing gas industry, LoVecchio said.

"It
represents a terrific market opportunity for us," said LoVecchio, who
declined to detail the railroad’s investment or whether it has a partner in the
development. "We are attempting to be nimble and respond to the market as
the opportunities present themselves."

Opportunities
will continue to grow as the gas industry matures, Gerdes predicted. "The
freight is coming, one way or another," he said.