Canadian Pacific Kansas City to restart railway operations following order on arbitration

The Canadian railroad strike that remained in effect for about 18 hours is being called off with Canadian Pacific Kansas City stating it is preparing to restart railway operations in Canada following the federal government intervention, the railroad said late Aug. 22.

The return to work comes in the wake of the Canadian Minister of Labor's announcement that he will exercise his authority under Section 107 of the Canada Labor Act to direct the Canada Industrial Relations Board to impose final binding arbitration and for railway operations to resume forthwith, CPKC said.

"Our teams are already preparing for the safe and orderly resumption of our rail network and further details about timing will be provided once we receive the CIRB's order," the railroad said.

The Canadian Labor Minister Steven MacKinnon told reporters Aug. 22 that following a stalemate in the bargaining process between Canadian National and CPKC railroads with the Teamsters Canada Rail Conference, a decision was taken to instruct the CIRB to extend the current collective agreements, order a return to work and send the remaining issues to binding arbitration.

"These collective bargaining negotiations belong to these parties, but their effects and the impacts of the current impasse are being borne by all Canadians," MacKinnon said.

Both CN and CPKC went on a strike Aug. 22 seeking better working conditions and higher compensation.

From an oil and gas perspective, railcars haul nearly 90,000 b/d of crude oil from Western Canada to refineries primarily in the US Gulf Coast and Midwest and small volumes to the US East and West Coast.

Also, Western Canadian Sedimentary Basin LPG is shipped in railcars to the Canadian Pacific Coast in British Columbia for exports to Asia-Pacific.

In 2024, Canada is expected to produce on average 330,000 b/d of propane and 220,000 b/d of butane, excluding imports, according to S&P Global Commodity Insights.

A high percentage of this volume is moved via railcar, whether it be export demand or domestic demand. Also, another 120,000 b/d of propane is for domestic demand, serviced either by truck or rail, and 170,000 b/d of butane is consumed domestically, largely in the refinery sector for gasoline blending. The balance of about 210,000 b/d of propane and 50,000 b/d of butane is exported.