$40M CG Railway deal to create 600 N.O. jobs

Gov. Kathleen Babineaux Blanco announced Thursday that New Orleans-based CG Railway, a wholly owned subsidiary of International Shipbuilding Corp., will relocate a rail car cargo facility from the Port of Mobile in Alabama to the Port of New Orleans' Elaine Street Wharf in eastern New Orleans.

The $40 million project is expected to generate up to 600 jobs and lead to between 1.5 million and 2 million tons of new cargo at the Port of New Orleans.

It should be apparent by our actions this year, and our rate of success, that we are serious when we say that Louisiana is open for business, said Blanco, who joined in negotiations with CG Railway during a November visit to San Antonio. We are competing head-on with other states and bringing home opportunities instead of just hope for Louisianians.

Blanco also credited Louisiana Economic Development Secretary Michael Olivier and his economic development team, the city of New Orleans, Greater New Orleans Inc., the New Orleans Public Belt Railroad, the Port of New Orleans, the Crescent Pilots Association and the Associated Branch Pilots for helping land the project.

The state of Louisiana is investing up to $15 million in infrastructure improvements at the Port of New Orleans to accommodate CG Railway's rail and cargo activities. Additional improvements will be made by the city of New Orleans, the Port of New Orleans and the New Orleans Public Belt Railway.

The project is expected to generate a total of $32 million in tax revenue over 10 years. CG Railway now moves 10,500 rail cars annually via a water rail service between Mobile and Coatzacoalcos, Mexico, near Mexico City. The company plans to expand in 2005 to accommodate up to 25,000 railcars annually at the new site.

Erik Johnsen, chairman of the board of International Shipholding Corp., said Louisiana refused to take no for an answer and created an economic package tailored to the specific needs of CG Railway. Today's decision is about what New Orleans and Louisiana did right in attracting new business to the region, said Johnsen. We were presented a competitive package that emphasized the natural transportation advantages that New Orleans and Louisiana offer a business like ours.

CG Railway will relocate to a 60-acre site on the Mississippi River Gulf Outlet in New Orleans and use two rail yards operated by the New Orleans Public Belt Railroad and the Port of New Orleans. The company will invest significantly in equipment upgrades and improvements to the planned site in New Orleans and the current facility in Mexico.