The government of Mexico has hired Canadian rail operator Canadian Pacific Kansas City (CPKC) to carry out a feasibility study for a 220km high-speed railway between Mexico City and the industrial centre of Querétaro, the Mexico Daily Post reports.

In 2014, Mexico awarded a contract to build such a railway to a Chinese-Mexican consortium, but later cancelled it.

Speaking on 13 July, Mexican president Andrés Manuel López Obrador said the agreement had been signed about two weeks ago.

CPKC is a company formed in April by Canadian Pacific’s US$25bn acquisition of Kansas City Southern. It now operates some 32,000km of rail across Canada, the US and Mexico, including the freight line between Mexico City and Querétaro.

Obrador said the idea was to modernise this line and make it suitable for passengers.

In 2014, the railway was to have been a $3.7bn showcase project for Chinese-Mexican cooperation (see further reading).

The work was awarded to a consortium made up of China Railway Construction Corporation with local companies Prodemex, Constructora y Edificadora GIA, Constructora Teya and GHP Infraestructura Mexicana.

But the deal was cancelled eight months later by then-president Enrique Peña Nieto after complaints were made by members of the Mexican parliament over the way the deal had been done, and the fact that the Chinese-led consortium was the only bidder.

The government paid $16m in compensation to the consortium members, and relations between the Mexican government and Chinese companies cooled.