The British Columbia Railroad was province owned, and there was an extensive effort for a while to extend the railroad north to develop new parts of the province. There is a more recent study on rebuilding the White Pass you can find on-line. I don't recall if a gage change was part of the conclusion, but the purpose was to service new mineral deposits they wanted to develop. As I recall, it considers both an extension of the railroad to the proposed mining area, or reinstating White Pass's previous intermodal truck-rail-marine-??? operating pattern.
What would be the demand to change gage? The majority of the proposed traffic is bulk, and the concentrates may be moved by container anyway. If there was a substantial amount of general freight, then there would be an advantage to use standard gage to allow for rail car movement by barge service out of Skagway.
As far as passenger service, that would make nullify much of the investment over the recent years in new passenger equipment. There might be a resale market for some of it, or I guess the newer equipment could be initially converted to standard gage. Standard gage passenger equipment isn't an off the shelf item. Even if they jumped in immediately and bough all the vintage equipment that is available from Iowa Pacific's receivership and private owners dumping equipment to Amtrak's policy change, all that equipment would have to be rebuilt to some kind of common standard. Also - they are looking for seating capacity, or do they change their minds and try to offer a first-class experience like they do on the Alaska? New equipment is possible, but extremely expensive. And locomotives become an issue as new passenger locomotives are in the $4-6 million price range as most are basically being custom built and bring the Tier 4 emissions issues with them. It may be a struggle to find enough older passenger diesels, especially since many of them are being disabled/scrapped as part of government programs/grants for their new "greener" replacements.
As long as the customers like the "vintage" one day White Pass experience and there is no huge return of freight demand, I don't think I could financially justify the cost of gage conversion, any real operating advantages and there really isn't a clear operating equipment source.
