and two alternative schemes were developed. One was for a narrow gauge line from the Llanfyllin terminus of the Cambrian Railways branch. The other was for a standard gauge line from Porthywaen, four miles south of Oswestry. After deliberation, the latter was adopted. The Cambrian Railways agreed to work the line for 60% of gross receipts, and a Treasury grant of £22,000 was agreed, as well as an interest-free loan of £6,000. Financial assistance was also made available from local councils; the share capital of the Company was £15,000. The General Manager of the Cambrian Railways, Mr C. S. Denniss, estimated the capital cost of the line at £46,000. Receipts would be £2,950 per annum. After interest and fixed charges, this would enable a dividend of 4% to be paid. "The margin is admittedly small", he commented. The same newspaper report asserted different figures provided by the Town Clerk of Oswestry, Mr J. Parry-Jones. The total capital of the Company was to be £65,500. Local authorities had promised £18,500 in loans or share subscriptions; £18,000 had been promised as a free grant (though with conditions) by the Treasury; £20,000 had been promised by the Trustees of the Llangedwyn Estate, probably as a share subscription; £1,500 in shares by the Earl of Powis, and about £4,000 by other local investors. "The company's borrowing powers are £12,000, so that towards the £65,500 capital required, they are sure of over £55,900." On this extremely shaky basis the company was founded. The Light Railway Order was granted on 12 September 1899, although modifying Orders were needed in 1904 and 1908 to assist in raising capital. J. Strachan of Cardiff was selected as the contractor: he had been the contractor for the construction of the Welshpool and Llanfair Light Railway. The first sod was cut at Porthywaen on 12 September 1899 by the Countess of Powis, but construction did not start until July 1901. During the construction period, Strachan arranged to convey passengers free of charge on market days over part of the line. Some goods traffic probably also passed at this time. Contemporary travellers reported: "The little six-wheeled engine ... was spinning along a quite a rate, considering its small wheel diameter; the carriage was a four-wheeled one, painted a dull red, and probably used at other times to convey the navvies to and from their work." The line was inspected by the Board