Media Release - Freight Victoria successful tenderer for VLF

[steam4me@enternet.com.au (Yuri J Sos)]

FROM THE OFFICES OF THE PREMIER AND THE MINISTER FOR TRANSPORT

The Premier, Mr Kennett today announced the selection of Freight
Victoria (FV) as the successful bidder for V/Line Freight Corporation
(VLF).   The consortium will pay the Government just over $163 million
for VLF under a 15 year renewable lease to operate and maintain
Victoria's country rail network.

The Premier said FV plans to develop VLF over the next five years.
Those plans played a significant role in the consortium being selected
to operate VLF.

FV will invest $36 million in the first two years to improve
infrastructure, modernise or replace part's of VLF's locomotive fleet
as well as upgrade the Geelong grain loop to include standard gauge.
The consortium also plans to increase key bulk traffic flows including
paper and logs, sand, grain and fertiliser.

The Premier said that as apart of the lease agreement, other passenger
rail and freight operators will have the right to run their own
services in competition with FV in accordance with standards set by
the Government.

"Paving the way for competition and having improved infrastructure is
a great result for Victoria, particularly in rural and regional
Victoria," the Premier said.

FV is a consortium of US rail freight operator RailAmerica, Macquarie
Bank, Goninan and Fluor Daniel which have wide ranging experience inn
running rail freight operations in Australia, the United States,
Canada and South America.

The consortium intends to invite up to 49% Australian equity
participation in FV.  

Transport Minister, Robin Cooper, said the introduction of private
enterprise will assist our farmers and industrial producers for whom
freight transportation is a key cost.  "An efficient, commercially run
rail freight service will help our wheat and barley producers, our
rice growers and other bulk industries to compete even more
successfully in their own markets."

Mr Cooper reiterated that Fast Track, VLF's parcel service, would
continue to operate and receive Government subsidies.

Having satisfied the legal and financial requirements laid down by the
Government, FV is expected to formally take over the running of VLF in
8-10 weeks.  The company will be required to obtain full safety
accreditation from the Director of Public Transport Safety before
taking control of VLF's operations."

Once the sale is completed, FV will take on the ownership of VLF's
rolling stock and key maintenance facilities, including the South
Dynon Locomotive Workshop and facilities in Geelong, Portland and
Wodonga.

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