Vic govt outlines rail modernisation plans

The Victorian government has outlined a plan to modernise and boost the freight carrying capacity of rail infrastructure in the state's west.

The Murray Basin Rail Project will cost up to $220 million and will involve replacing hundreds of kilometres of outmoded "broad gauge" tracks.

A new "standard gauge" railway line from Mildura to Geelong is expected to be complete by 2018.

"By converting the existing broad gauge tracks to standard gauge, the Murray Basin Rail Project will deliver modern rail infrastructure, and transform Victoria's freight network, to meet the increasing demand for freight services," Victorian Deputy Premier Peter Ryan said on Saturday.

"It will improve transport efficiency and enhance access to the ports of Portland, Geelong and Melbourne for Victorian exports."

The upgraded freight lines will enable trains to carry an additional 300 to 400 tonnes - a 15 per cent productivity improvement.

Mr Ryan said it would also support the reintroduction of passenger train services to Mildura and, ultimately, could allow the creation of a new "transcontinental link" and jump-on point for Victorian trains on the Sydney-to-Perth rail line.

The first stage will cost $41 million and involve upgrades to the Mildura to Maryborough, and Hopetoun to Murtoa, rail lines.

"The final cost and alignment of the full Mildura to Geelong rail standardisation will be guided by the final business case to be delivered by the end of the year," Mr Ryan said.

The plan was announced in Mr Ryan's keynote address to The Nationals state conference, in Benalla.