CN CA and Coalspur Mines Limited announced that they have signed a memorandum of understanding under which they will develop a high quality logistics supply chain to transport export thermal coal from Coalspur's Vista Coal Project (Vista) near Hinton, Alta to Western Canadian ports starting in 2015.

The MoU establishes the framework for an agreement that will accommodate Coalspur's plan to commence coal production in 2015 at a rate of approximately 2.5 million tonnes per annum rising to about 11.2 million tonne per annum by 2019.

CN will transport Vista production to west coast ports including Ridley Terminals Inc located at the Port of Prince Rupert, B.C. Coalspur recently signed a throughput agreement with RTI to handle up to 8.5 million tonnes per annum of export coal at the terminal.

CN and Coalspur will jointly design and build a rail siding at the Vista site capable of handling the loading of 175-car unit trains at a full capacity of gross weight on rail of 286,000 pounds per car.

The two parties expect to negotiate a definitive transportation agreement in 2012, following completion of Coalspur's ongoing Bankable Feasibility Study on Vista.

Mr Jean-Jacques Ruest executive vice-president and chief marketing officer of CN said that "CN will work closely with Coalspur to build an efficient and effective logistics process for its export coal. CN has developed a comprehensive, end-to-end supply chain strategy to manage coal flows from mines to west coast terminals. This approach, coupled with strong customer collaboration, will help Coalspur maximize sales opportunities in global markets."

Gene Wusaty MD AND CEO of Coalspur, said: "Rail is a critical link in connecting Vista's coal to international markets and an agreement with North America's most efficient rail carrier will help ensure a reliable and effective supply chain."