Shane Jones says Northland rail upgrade won’t be cheap

Fixing Northland's rail network to relocate the Ports of Auckland will come with a hefty price tag

6th Mar 19, 12:37pm by Stephen Forbes

Upgrading the Northland rail network and installing a link to Whangarei’s Northport could cost up to $500 million, according to Infrastructure Minister Shane Jones.

He made the comments after questions about the Upper North Island Supply Chain Strategy working group which the government established last year to look at the development and delivery of a freight and logistics in the country’s Upper North Island. It has also been tasked with investigating the feasibility of relocating the Ports of Auckland to Northport in Whangarei.

The group is being chaired by former Far North Mayor Wayne Brown and includes KiwiRail chairman Greg Miller, who Jones describes as an international expert in logistics, as well as Susan Krumdieck, Shane Vuletich, Sarah Sinclair and Noel Coom.

The New Zealand First MP has previously stated his commitment to seeing the Ports of Auckland’s operation shifted to Whangarei’s Northport. But before that can happen the rail network north of Auckland would need to be upgraded to handle the massive amounts of freight that would be involved.

Jones says he’s waiting for a report by consultants Deloitte and Aecom looking at future rail options in the region.

“I’m expecting that report in the next month,” Jones says.

He says the study will tie in with the Upper North Island Supply Chain Strategy working group's final report which he hopes to present to cabinet soon.

But the proposed works won’t be cheap.

“There wouldn’t be any change out of $500 million to put in the spur and upgrade the northern rail line. And the task of rehabilitating the country’s rail network to the point of making it a real alternative to road based freight will take more than one budget,” Jones says.

“However, with the Provincial Growth Fund (PGF) we’ve always planned to use a big chunk of that for the rail network.”

Jones says while the government has earmarked $3.5 billion in the 2019 budget policy statement for capital projects, including rail, its goal of reducing net Crown debt to less than 20% of GDP in the next five years will also have an impact on spending options.

In January KiwiRail Acting Chief Executive Todd Moyle announced it had completed the first stage of an investigation into installing a 20km spur, or secondary line to Northport at Marsden Point.

“Our teams have spent the past three months drilling into hills, land and coastal areas to gain a full picture of the challenges of building what would be rail’s first new significant branch line in more than 50 years,” Moyle says. “This is not an easy job but it is a real signal of the Government’s commitment to boosting regional economies through rail.”

He said KiwiRail’s work had focused on the areas where the most engineering work would be needed.

“Concurrently we are looking at how we can upgrade the North Auckland Line between Auckland and Oakleigh. The tunnels on that line are old, low and narrow. We have had two significant derailments on the line in recent months due to a lack of funding for maintenance. It has been unable to carry passengers for the past year and freight options are restricted."

But any talk of upgrading Northland's rail network so the Ports of Auckland could be shifted to Whangarei won't sit well with Auckland Mayor Phil Goff who last month stated his opposition to such proposals.

He says the Ports of Auckland are an important asset for the council and the people of Auckland and any decision to move it or its operations shouldn't be taken lightly. The council has invested hundreds of millions of dollars in it over the years and it returns a healthy annual dividend of $51.1 million to the Auckland Council as its owner.

Goff says before the Ports of Auckland, or any of its operations are moved, it’s important that there’s a strong business case supporting it.

And he says before any agreement is reached it’s important that the Auckland Council, on behalf of the city, has its say.

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34 Comments

by Boatman | 6th Mar 19, 1:04pm 1551830655

Moving all the Auckland port operations will never happen , not in my lifetime or anyone else reading this.

There is no reasonable economic case for doing so
The costs of infrastructure upgrades are beyond our resource capacity both in money and manpower
There is plenty of spare capacity in Tauranga to take any excess freight ( It could absorb almost all of Aucklands freight, and way cheaper too )
The sunk costs of what will be required in Whangarei will prove to be throwing money into a bottomless pit for Government , for very little return.

by Withay | 6th Mar 19, 1:39pm 1551832740

Does an economic case figure too heavily in the thinking behind this? I don't think so. It's idealogical. If this goes ahead, this is an example of gov overstepping their bounds or atleast creating more unintended consequences (should be foreseeable consequences really).

by sharetrader | 6th Mar 19, 2:41pm 1551836479

you are wrong about Tauranga for one reason, the kaimai tunnel, and the one rail line from Hamilton to Tauranga,
ask anyone in the industry what happens when a derail or maintenance happens, it bedlam and containers can take up to ten days to appear in Auckland.
to increase capacity would mean a new tunnel and double lining all the way.
the same would happen up north if they dont double line , fortunately a lot of the tunnels can be opened or a better route found.
they need to spend the money on rail in both directions so we can have real competition amongst the ports and security of supply

by NorthernLights | 6th Mar 19, 3:41pm 1551840097

No no !
Moving Auckland freight by rail ( & trucks ) from Whangarei will definitely build the area up and offer the sorts of “opportunities “ the elite in Northland can participate in $$$
Auckland City has extreme debt problems so why would it agree to give away any more port container freight etc simply to appease the empire building desires of notable Northlanders I won’t list here ?

by John | 6th Mar 19, 1:07pm 1551830860

Goff getting all precious abouts Ports, who cares what you invested, happens to private sector every day, why should the council be immune. Ports of Auckland are struggling and need more space, we need a step change, harbour is now too small and there are other stakeholders who would benefit from port moving.

by Lapun | 6th Mar 19, 1:36pm 1551832564

Great cities start by huddling close to a port. Then they get bigger and either the port moves or the city centre moves. Ref London and New York. Time Auckland reached stage 2 and used that valuable land for something other than parking cars and containers.

by GV 27 | 6th Mar 19, 1:55pm 1551833735

Then let them pay for the massive relocation costs, the infrastructure and the mop-up for the dividend forgone by the Council. Or as usual, are other people looking to push costs onto others so they can keep the trappings for themselves?

by NorthernLights | 6th Mar 19, 3:46pm 1551840398

John
Love your use of the word “Stakeholders” along with “Benefit”
Please don’t assume moving container traffic outside Auckland is of benefit to Auckland stakeholders
Think benefit to Northland stakeholders
Heck it’s been a long time since I lived in kiwiland maybe Aucklanders swallow these days whatever they’re told ?

by Foyle | 6th Mar 19, 1:55pm 1551833730

Put the money into 4-laning Warkworth-Whangerei and Bombay-Tauranga and in 3-5 years autonomous electric trucks will be able to do the freight in the dead of night. No more white elephant railways please.

by Shoreman | 6th Mar 19, 2:04pm 1551834240

Doyle - Exactly do the roads the rail link North is a dinosaur just like Jones !

by sharetrader | 6th Mar 19, 5:58pm 1551848317

autonomous trucks for NZ linehaul are miles away. more like 20 years before we will see them here.
Auckland port is only now introducing autonomous straddles that have been around the world for ten years +,
good news is they cant go on strike but they can go offline

by Foyle | 6th Mar 19, 3:49pm 1551840562

Tesla claiming Level 4 Autonomy later this year, Google Waymo also have taxis operating with paying customers at level 4 now. A number of other companies like Daimler are claiming that they will have level 4 autonomous trucks on the road this year. Allowing autonomous operation in well surveyed areas. That is sufficient for depot to depot truck driving to deliver containers. Level 5 is still likely a couple more years away, but the machine learning side of things is moving ahead at incredible speed, so I wouldn't bet against it being sooner.

Also trucks can afford to have far more expensive and extensive autonomous systems on board.

by sharetrader | 6th Mar 19, 6:04pm 1551848650

still a lot of problems to solve yet
Uber Suspends Autonomous Truck Testing After Arizona Pedestrian Death Involving Car
https://www.ttnews.com/articles/uber-halts-autonomous-car-testing-after…
What you probably won’t have heard about is the first-ever crash involving a self-driving truck, which occurred last November on California’s Junipero Serra Freeway in Silicon Valley. At 9:45 in the morning of November 9, a semitruck owned by startup Starsky Robotics was involved in a collision with a passenger car. The car hit the truck’s tires and broke a mud flap and had to be towed from the scene

Fortescue Metals Group insists a crash between two driverless dump trucks at its Christmas Creek iron ore mine in the Pilbara this week was not a failure of its autonomous haulage system.

by powerdownkiwi | 6th Mar 19, 1:55pm 1551833718

Rail is advocated by those who anticipate trouble getting and maintaining bitumen.

But some who get that, forget the other ramifications - a lot less trade being one.

The essence is whether Auckland can be fed 'locally', when things break down and get local. The problem is that almost nobody sees this as a possibility.

by Foyle | 6th Mar 19, 2:00pm 1551834012

Concrete is perfectly viable as a road surface, most of US interstates are concrete, and we can synthesise bitumen using nuclear heat sources for similar cost to current oil in distant future when it is required.

Tech doesn't stand still Mr Malthus..

by Averageman | 6th Mar 19, 2:05pm 1551834358

This is a "think big" project for this generation. Yes it will be expensive but it will underpin security of port operations for Auckland from two directions, underpin Whangarei as an economic location just like the port in Tauranga has for that region, and provide a source of afordable housing for that work there and in support businesses. Port of Tauranga, rail and an inland port faculty has proven to be a very successful model.

Imagine London if it continued to ship all its imports in via the Thames?

by solardb | 6th Mar 19, 2:33pm 1551836002

As usual , the all or nothing comments kick in, and it becomes a white elephant. Northland needs a upgraded railway , with port access. Auckland needs the port area to be made more resident friendly. Some of its traffic could be transferred to Northland , some to Tauranga. Some could stay in a smaller prot area , probably container traffic , possibly the pacific island services. We are probably talking a 10 to 20 year timeframe.

by Pragmatist | 6th Mar 19, 2:49pm 1551836984

"Auckland needs the port area to be made more resident friendly"

We've been doing just fine with our resident unfriendly port for years.. not sure about this "need" actually existing.

by xingmowang | 6th Mar 19, 2:41pm 1551836467

I could link up with some renowned Chinese infrastructure building companies.

Without any comprising on quality, the cost and time of building those infrastructures would be 60% of what Shane said.

by RickStrauss | 6th Mar 19, 2:47pm 1551836867

We could probably get some CCP financing under the One Belt, One Straitjacket initiative too, I'd bet. We may not own our infrastructure by the end, but oh well.

by xingmowang | 6th Mar 19, 2:48pm 1551836938

only if NZ were too poor, as African countries, to fund herself.

by saving4AUhouse | 7th Mar 19, 11:27am 1551911238

I could link up with some renowned Chinese infrastructure building companies.

No thanks hsingmowang, the PRC is not exactly renowned for quality... well anything.

by Tim Depositor | 6th Mar 19, 3:11pm 1551838317

Excellent work NZF!

by waymad | 6th Mar 19, 8:58pm 1551859121

Indeed, if the 'biz case' pans out (cue selected ~~cronies~~ 'experts' with whom to stack the judging panel), this will be an Excellent Vote Purchasing Scheme for NZF.

by Boatman | 6th Mar 19, 3:35pm 1551839738

Shades of Muldoon in this idea

by KH | 6th Mar 19, 3:45pm 1551840340

Tauranga. And double line the railway there.

by JB | 6th Mar 19, 4:17pm 1551842264

Could someone explain how freight trains are going to merge with passenger trains running every 10 mins on the western line - there is only one way for the northern line to enter / pass Auckland.

This whole scheme is about as mad as one could devise. Driven by the Greens and their public transport vision - or apparition.

Build a 4 lane motorway to at least Whangarei and further north to Kaitaia.

Northern areas will remain zombie towns until they have reliable fast transport.

Autonomous driven trucks are very close and we should build for future technologies - not rail.

Govt can today borrow long term for ~ 3 % - very very low by any standard. Borrow up big time to find these major transport initiatives - It won't get any better than today.

Also provides long term certainty for future work force opportunities.

Just driving down to Hamilton on the new safe high speed highway demonstrates what a difference they can make to ease and speed of getting around.

Add buses if you must - far far cheaper and more flexible than any train service that can only ever be point to point

by RickStrauss | 6th Mar 19, 8:07pm 1551856020

Could someone explain how freight trains are going to merge with passenger trains running every 10 mins on the western line - there is only one way for the northern line to enter / pass Auckland.

I'm going to go with "trial and error".

by Foyle | 6th Mar 19, 8:50pm 1551858653

Wrongthink. We need 20th century inflexible expensive archaic transport infrastructure that favour monopolies and unions and restrict peoples freedom of movement and generally crappifies their lives in order to satisfy Green misanthropy, not any of this pragmatic 21st century technology solutions that might actually improve living standards.

by JimboJones | 6th Mar 19, 4:45pm 1551843909

Shouldn't the location of port and the transport options to the port be decided by an independent assessment?
Does it make sense for it to be Northland and Rail just because Shane Jones says so?
I mean it might be the best outcome, but can we really afford to go by someone's 'gut' feeling?

by WestieAJ | 6th Mar 19, 10:09pm 1551863350

Auckland port has a space problem because it wants to handle the car trade. Cars and other vehicles that come via ro/ro take up a lot of space because they can't be stacked like containers. So Bledisloe wharf which used to be a 2nd container terminal has cars and trucks parked all over it. So all container operations need to handled at Fergusson which struggles to cope with the volume. Most of the new cars that arrive in Auckland are transferred by car carriers to large storage sites all over Auckland while they await sale and distribution to the dealer network which involves another car carrier trip.If car ships were to call in Northport the vehicles could be stored on the port at low cost and distributed from there direct to dealerships on as required basis. Compliance of used vehicles could also be relocated to Northport Area. Once complied the could then be driven direct to dealerships in the Auckland area or transported via truck. This could be a possible employment opportunity to create driver teams to manage this task. Would probably need to be moved at night due to traffic issues. Also, low cost on port storage in the Northport area could be offered to used import dealers as well. The former container terminal at Bledisloe could be used again to handle the overflow of containers from Fergusson. The automated straddle carriers coming into service would make this more economical. Car trade is very lucrative for ports of Auckland. so they won't want to give it up. But they have political masters who are well connected to central government. Plans to extend Fergusson terminal into the harbour and to build a giant parking garage on Bledisloe to store cars are both political poison.

by sharetrader | 6th Mar 19, 11:41pm 1551868915

fergusson is a nightmare at the moment , the ports of Auckland are trying to automate and have cut staff already, importers and exporters are paying for it in extra charges from the delays that are being caused

Ports of Auckland working on several projects to ensure they can handle freight demand for the next 30 years
, including the partial automation of Fergusson Container Terminal; a large and complex project being undertaken while keeping existing operations running
. This has seen a yard capacity reduction of between 20% to 30%
.Once automation is complete, Port estimate it could take up to 12 months to fully optimise.
50% of vessels are arriving out of schedule and exchange sizes being increased at short notice to evacuate surplus empty containers from the Auckland market.
This has impacted their productivity and service levels at the ship and the gate.
•VBS, the changes made over the last few months will remain. The transport
industry has stressed the need for transparency of slots released and POAL need that to manage demand. As yard congestion increases this affects the number of slots they
can handle each hour
Vessel Exchange, assuming ships are on window, yard capacity is at its maximum utilisation on a Sunday. To deliver more realistic truck turn times on Monday/Tuesday
the Port has reduced the number of slots per hour they make available to match
achievable straddle moves per hour.
POAL will provide an additional day’s import demurrage free time to those vessels to
compensate for the truck slot reduction.
Exports, early receivals will not be accepted, with rolled bookings being monitored and the appropriate storage charges to be applied
Resource, labour shortages on port are acute with the need to increase operational headcount by 20-30 on fixed term contracts

by rastus1 | 7th Mar 19, 9:59am 1551905983

Simple solution is to stop importing so much shyyyyt. Much of what we import lasts 5 minutes and then hits the landfill. Just take a stroll around the warehouse....unnecessary temporary c##p

by The_4th_estate | 7th Mar 19, 11:19am 1551910755

Having ex'd and imp'd out of both Akl and Tga while being based in Tga and Hamilton, I can say with certainty that Tga is utterly constrained by out of date infrastructure connecting to the port, while they work extremely quickly on the port itself (although in very outdated modes) once the box hits the ground its very slow from there due to lack of capacity to move boxes by road or rail, one car crash or a hiccup in the tunnel and it goes haywire. Btw the kaimai tunnel is at capacity, approaching its refurb date, the track bed has been pulverized and the option of a second tunnel has never been addressed. Future planning? Not! Auckland is severly congested and even worse. Move the ports up north build a transport corridor combining road and rail, sometimes thinking big is good, it means you are actually thinking about the future and building a nation instead of sweating existing assets and doing nothing about tomorrows needs, as we have done in this country, disasterously for so long. The Auck waterfront could have a london docklands redevelopment and a small commuter airport as well!