Kelowna Pacific Railway shutdown impacts Okanagan businesses

Several Okanagan businesses are trying to figure how to deal with the closure of the Kelowna Pacific Railway, which went into receivership on Friday and suspended operations.

KPR's general manager told CBC News that the CEO of the company only informed him and the other employees that they were going into receivership on Friday.

The KPR employed about 40 people in Vernon, and moved about 16,000 rail cars of product every year.

The receiver, John McEown, with Boale, Wood & Company Ltd. in Vancouver, says the railway had not been profitable for some time due to a reduced volumes in the forest industry.

Shipments stranded

McEown says workers have been informed how to start the process to recoup wages they are owed and his company is also in discussions with companies that have product currently sitting on rail cars.

The short-haul line provided a connection to CP Rail's yards in Kamloops for several Okanagan industries including Sun-Rype Products, OK Builders Supplies and the Tolko wood products mills in Lumby, Armstrong and Kelowna.

Ron Bush, the operations manager for OK Ready Mix, says they used the KPR for weekly shipments of cement into operations from Vernon through to Penticton.

"We get cement sent to us from Vancouver and Kamloops. It depends on business. It could be five rail cars, it could be 20," he said.

Tolko vice-president Hardy Wentzel says the company was told late last Friday that it could no longer ship its wood products by rail.

"[It was] quite a shock, quite a surprise," he said. "But we worked through the weekend to develop the backup plan that we needed."

He says the company is finding other ways to move its product.

"We're very busy working with our trucking contacts to find trucking available in the area."