Canexus crude-by-rail project in Alberta sees costs soar by 40 per cent

CALGARY – Canexus Corp. (TSX:CUS) says the price tag of its oil-by-rail terminal expansion project in Bruderheim, Alta., has risen by 40 per cent over the previous cost estimate of $225 million.

The stock was down about 13 per cent to $6.56 at mid-day on the Toronto Stock Exchange.

CEO Gary Kubera says the company is disappointed with the revised estimate, but noted Canexus has “established a state-of-the-art facility.”

The first phase of the expansion is in the process of starting up and the company expects to load 14 unit trains, or about 30,000 barrels per day of crude, during February.

The project is expected to be complete later this year.

Canexus expects to fund the incremental cost from its committed credit facilities.