By Robb M. Stewart


Canadian National Railway said it remains committed to a proposed container transfer facility in southern Ontario after a court ruled against federal approval for the project.

The rail operator said Monday the proposed Milton Logistic Hub west of downtown Toronto is critical to handling growing demand. New capacity is needed in Canada's busiest and fastest growing region, and the hub would benefit the province and further strengthen the Canadian economy, CN Rail said.

The company authorization to build the project was subject to Canada's most extensive environmental review process, which resulted in an approval that included 325 conditions designed to protect the community and the environment.

The proposed 250 million Canadian dollars ($184.3 million) truck and rail facility in Milton was approved by the federal government in January 2021.

Last week, the Federal Court of Canada ruled in favor of Halton Municipalities and found that the approval decisions failed to fulfill a duty to protect human health.

In its ruling, the court said the government referral decision and a Cabinet justification decision for the C$250 million facility were flawed and didn't "meaningfully grapple" with the project's significant direct adverse environmental effects on human health. The court ordered that the decisions be set aside and remanded for redetermination.

The court noted that a review panel appointed under the Canadian Environmental Assessment concluded the project, after taking mitigation into account, would likely cause significant adverse environmental effects, including direct risks to air quality and human health as well as cumulative environmental effects on air quality, human health, wildlife and habitat, and agricultural land.

Following the decision, Halton Regional Chair Gary Carr said the local government was pleased with the court's determination regarding concerns about the health and safety of residents. The municipality said the project site is located within one kilometer of more than 34,000 residents, one hospital, 12 schools and two long-term care homes.


Write to Robb M. Stewart at robb.stewart@wsj.com


(END) Dow Jones Newswires

03-04-24 1339ET