Northern is considering buying new rail equipment. The following information is available:

1. The new equipment will generate annual pre-tax savings of $50,000 over 10 years. Costs for depreciation are included in the pre-tax savings.
2. A payment of $1,100,000 will be required immediately. The equipment will be straight line depreciated over 10 years, has a salvage value of $100,000 and is subject to normal CCA tax rules.
3. Fuel worth $100,000 will need to be kept on hand at all times.
4. The tax rate is 30%, and the CCA rate on equipment is 20%.
5. The investor is also considering a similar investment that will generate an after tax return of 12%.

Required: Calculate the Net Present Value of this project.