In 1884 the Argentine government granted the Welsh immigrant Lewis Jones a concession to build and operate a railway between the valley of the Chubut River and Porth Madryn on the southern side of the Península Valdés.

Works began in 1886, directed by engineer Jones Williams, in both cities simultaneously, Puerto Madryn and Trelew.

Apart from the local workers, several groups of immigrants were brought from Italy, Spain, Syria, Wales among other countries on the Vesta ship.

[1][page needed] On 11 November 1888, a line 70 km long between Trelew and the quay in Puerto Madryn was opened.

CCR's track gauge was converted to 750 mm (2 ft 5+1⁄2 in) in 1922,[4] and later the line was extended from Dolavon to Las Plumas.

It was also expected that the Government acquired diesel locomotives and built a broad gauge line from Puerto Madryn to Sierra Grande, connecting with the Nahuel Huapi railway in San Antonio Oeste.

According to Clement Dumrauf, the railway was not expanded due to British settlers that were interested in preserve the Patagonia region only for sheep farming.

In 1950 the Argentine state acquired a railcar for the Trelew-Rawson line and built 17 houses for workers in Puerto Madryn and 8 in Trelew.

While rail tracks were untouched and the rolling stock stored at warehouses in Trelew, 15 coaches were destroyed by fire, which caused the project to be suspended indefinitely.