Federal CIB notches first project in Alberta

OTTAWA • The Canada Infrastructure Bank will partner with the Alberta government to study a proposed rail line between Calgary and Banff, notching its first contract in the province.

The bank on Tuesday said it would launch a cost analysis of the rail line, which could still remain years from a final investment decision. It is the first announcement by the Canada Infrastructure Bank since its chief executive, Pierre Lavallée, stepped down unexpectedly in April, amid criticism that the bank had been slow to approve projects.

The bank at the same time appointed Michael Sabia, head of the Caisse de dépôt et placement du Québec, as its new chairman, in a move widely seen as an effort to reinvigorate the $35-billion bank. Lavallée has not yet been replaced as chief executive.

The cost of the Calgary-banff rail line is pegged at $660 million in a 2019 report by the City of Calgary, Banff and municipalities. The 130-kilometre project would include six stops, leading from Calgary International Airport to downtown Calgary, then on to Cochrane, Morley, Canmore and Banff.

John Casola, chief investment officer at the bank, said the feasibility study comes after months of negotiation with the province. He said the bank's involvement could advance the project more quickly than in the absence of Ottawa's financial support, but declined to confirm whether it will eventually invest in the rail line.

“We're going to make it go as fast as we can possibly make it go,” he said, adding that the bank would avoid “just throwing money at projects for the sake of throwing money at them.”

The project was first pitched to the bank by private investors Adam and Jan Waterous, whose family owns the Mount Norquay ski resort in Banff.

The Liberal government established the $35-billion bank as part of its sprawling infrastructure spending plans, saying it would fill the gap for riskier projects that could not secure sufficient funding in the private sector. Its agreement with Alberta is the 11th contract it has signed since it was established in 2017.

Months before the bank opened, then-infrastructure minister Amarjeet Sohi said it would give Canada the ability to build more “transformational” projects that generate real revenue. However progress has been slow, with most of the 11 contracts non-financial agreements to offer advisory services.

So far, it has invested just $3.65 billion, with $2 billion of that going to the GO Expansion rail project in the Greater Toronto Area and $1.28 billion in low-interest loans to the Réseau express métropolitain rail project in Montreal.

Casola said it would be unlikely that a Calgary-banff rail project, an idea that has been kicked around for decades, would get built without the support of the CIB.