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Railroad commissionaire Toll Royal Railways has held preliminary discussions with the government to begin passenger service on Cambodia’s railways.

The first line of the railway from Phnom Penh to Kampot was officially declared open at a ceremony held this morning, three weeks after freight services commenced to and from the costal province.

Toll Global Logistics CEO Wayne Hunt said that though freight remained the first priority of the company, a spirit of agreement had been forged between his company and the government as the two parties worked toward resuming passenger service.

“It will happen, it’s just a matter of time,” he said, but cautioned that the service would have to be demand-driven.

A steady increase in tourists would likely contribute to demand for the passenger service, he said.

“This is about putting Cambodia’s best foot forward now, for the opportunities that are here now.”

Toll Royal is 55 percent owned by Australia-based Toll Global Logistics, and 45 percent owned by The Royal Group, according to information from the firm.

Hunt said the new railway did not expect to jump to an immediate profit, but aimed to break even within two or three years.

The railway presently employs more than 150 people, which is slated to grow to between 600 and 700 when it’s at full capacity. The firm’s investment to date has been about $5 million in the first 12 to 15 months, he said.

The ADB has loaned some $84 million towards the rehabilitation of railway, which fell into disrepair during the Khmer Rouge era.

A loan of $13 million from the Organisation of Petroleum Exporting Countries’ development agency, and grants of $21.5 million from Australia, $2.8 million in kind from Malaysia, and $20.3 million from Cambodia have also been contributed to the project.

Ministry of Public Works and Transport secretary of state Tauch Chankosal said the now reopened Phnom Penh to Touk Meas stretch will be followed by the reopening of the full 254 kilometre Southern Line to Sihanoukville in 2011, and then the 388 kilometre Northern Line linking the capital to Poipet on the Thai border.

There was a 48 kilometre “missing link” between Sisophon and Poipet on the Thai border, he said.

Presently there is no link between Phnom Penh and Vietnam, one of the last connections required to complete the Singapore to Kunming Rail Link, but Tauch Chankosal said the Chinese government had stepped in to fund a survey on building the link.

The cost of the rail connecting the Kingdom to Vietnam has been pegged at $600 million but could change depending on what the Chinese survey finds, he said.

The Asian Development Bank said the Singapore to Scotland link could be completed as early as 2015 in a statement.

ADB transport economist Peter Broch said Cambodia and the rest of Southeast Asia operated on different gauge rails than China and India, though he did not consider this a major obstacle.

“That’s a problem that can be solved on the border where the problem is,” he said.