KiwiRail would allow Hawke's Bay council to lease Napier-Gisbourne line

Kiwirail, the state-owned railroad, has conditionally agreed to lease the mothballed Napier-to-Gisborne line to Hawke's Bay Regional Council, effectively giving the local authority an option to resurrect the unprofitable route.

KiwiRail mothballed the line in December 2012 after storm damage it estimated would have cost $4 million to repair. At the time it said ongoing maintenance costs would have mounted up to a further $6 million a year.

By mothballing the the 212 kilometre Gisborne-to-Napier line, KiwiRail left open the possibility it could re-open in future if it became more economic. The railroad spent up to $4 million to make the line safe while closed, with annual maintenance costs of up to $800,000.

HBRC said it has until March 1, 2015, to respond to KiwiRail's offer and before then it will assess whether the line would make sense as an investment.

Some local businesses have been campaigning to get rail services re-instated.