These Denver & Rio Grande Western units should be quite used to a bit of tunnel running, even if it is on Union Pacific rails. This train is southbound in Nevada's Meadow Valley Wash; that's Nevada Highway 317 along the base of the opposite canyon wall. The dirt road is a railroad MOW road; the wash itself can be made out winding along between the two.
A brief note on terminology: the canyon is Rainbow Canyon, through which the Meadow Valley Wash flows (sometimes; sometimes a lot).