The construction of a railway in Tasmania was first considered in the years immediately following the establishment of responsible government (1856) the first line being planned to run between Longford and Deloraine. In 1865 the Tasmanian Government agreed to guarantee the interest on the bulk of the capital needed to finance the construction of the line based on a proposal put forwartd by a group of northern businessmen. ;;;;In 1867 the Launceston and Western Railway Company was formed. The Duke of Edinburgh turned the first sod on 15 January 1868 to commence construction of a line which was to be 45 miles long with a gauge of 5'3". Construction proceeded and on 19 August 1869 an excursion trip gave citizens of Launceston their first opportunity to travel by train. On 10 February 1871 the line was ready for its official opening with normal services beginning the 14th.;;;;The opening of the line however found the company in serious financial difficulties as rising costs had forced it to borrow additional funds from the Government. To ensure that the line between Launceston and Deloraine remained open parliament passed an amendment to the Company's enabling Act in 1872 to allow it to keep trading but bankruptcy appeared inevitable.;;;;A Special General Meeting of the Company shareholders on 18 July 1872 resolved to surrender the assets to the Tasmanian Government, with the proviso that shareholders would be compensated from any profit exceeding 24,000 pounds. Parliament legislated in 1873 to give effect to the resolution and provide for the Government to assume control of the assets and operate the line. The rights of the shareholders were only extinguished when the Tasmanian Government finally purchased the company assets in 1904 (at the conclusion of negotiations that had begun in 1900).