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It will be the world's most northerly railway, a private line snaking across the permafrost and rock of Baffin Island at a projected cost of $10-million per kilometre.

The ambitious project is part of a plan to tap iron-ore deposits 900 kilometres northwest of Iqaluit. The plan is subject to regulatory approval and securing financing, but preliminary drilling is already under way, say officials of Baffinland Iron Mines Corp., which is listed on the Toronto Stock Exchange.

Construction of the 143-kilometre railway from Mary River to Steensby Inlet is expected to start the summer after next and take four years. (The Norwegian island of Spitsbergen had narrow-gauge trains running from mountain mines to the coast since the early 1900s, but they shut down in the 1970s and were nothing on the scale of the proposed Baffin railway.)

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The engineers, a few of whom worked on the line to Lhasa, Tibet, say the steady cold on Baffin Island actually offers some benefit, removing technical challenges present in areas with more temperature flux. But the harsh environment will make construction much more difficult.

"There's severe weather and all of our construction schedules have to be built around that," said Rod Cooper, Baffinland chief operating officer and vice-president of operations.

The current plan is to start building the railway from both ends. As construction progresses, a series of work camps will be established along the route. The line will use a special type of high-grade steel designed for the extremely cold environment. And care will have to be taken to ensure that the embankment acts as an insulating layer that stops the permafrost from thawing.

"The principle is fairly simple," Mr. Cooper said. "You're building the railway embankment out of a material that's not going to change its volume or shape as it freezes or thaws."

The scale of the project has drawn the admiration of a keen Canadian train spotter.

"The cost and logistics of building a line up there must be just unimaginable," David Graham wrote in an e-mail exchange. Mr. Graham, who indulges his passion for freight trains in the area of Guelph, Ont., and on trips farther afield, had been hearing tantalizing hints about the project.

"I would absolutely love to go see it," he wrote.

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The line will ferry workers to the mine site but will be used primarily to carry ore to the port, from which it will be shipped to Rotterdam. The projections call for four trains a day, nearly 300 days a year.

Mary River is projected to produce 18 million tonnes of iron ore annually for a generation, Baffinland says. This year, three ships will carry bulk samples to European blast-furnace operators, giving them the chance to verify the quality of the ore.

"It's an exploration project right now, we certainly hope it will become a mine," said Gordon MacKay, director of minerals and petroleum resources for Nunavut.

"It would be a tremendous anchor for the territory," Mr. MacKay said.

He said Nunavut would not receive any direct royalties, which flow instead to the federal government and the Inuit. But some of that money could find its way to the territory. And the indirect benefits are already being seen in jobs and local spending.

With Nunavut's population at fewer than 30,000, Mr. MacKay said the effect of hundreds of direct jobs added to the territory "is really dramatic."

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The company is trying to raise $4.1-billion to finance the entire project.

The 143-kilometre railway will join the Mary River mines to Steensby Inlet, allowing year- round shipping of ore to European steel makers. Delivery of 12.6 million tonnes per year of ore will require, on average, four trains per day, 293 days per year, to travel betweenthe open pits and the port facilities.

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