Friday, 31 March 2017 11:28

New transload facility for Prince Rupert

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The Port of Prince Rupert has announced an expansion project for containerized cargo on Ridley Island that will help crops from the Canadian agricultural industry reach international markets while expanding intermodal logistics capacities at the Port of Prince Rupert. Ray-Mont Logistics is developing an integrated logistics and container loading operation at the south end of the Ridley Island Industrial Site on the recently-constructed Road, Rail and Utility Corridor. The operation will involve pulses and cereals (such as lentils, peas, beans, soybeans, flax, and wheat) as well as other specialty agricultural crops transported in hopper cars by rail from Western and Central Canada and the US Midwest. The cargo will be transferred to ocean containers for export via the Fairview Container Terminal, which is currently undergoing expansion

 

Operation of the completed facility will employ an estimated 40 people. The ten-acre facility will include a rail loop corridor in excess of 100 railcars, a grain dumper pit, and a state-of-the-art conveyance system. The Ray-Mont facility will utilize rail tracks on the Ridley Island Corridor to take delivery of agricultural commodities and meet market demand for port-loaded export containers on the West Coast.  Agricultural products from Alberta, Saskatchewan, Manitoba and further inland will unload at the facility via a conveyor system. IDL Projects, on behalf of Coast Tsimshian Northern Contractor Alliance, will begin clearing the site this week and the new transloading facility will be operational in time for the 2017/18 crop year this fall. 

Friday, 31 March 2017 11:23

FMC updates service arrangements

FMC

 

final rule by the Federal Maritime Commission amending requirements for Service Contracts and NVOCC Service Arrangements (NSAs), announced earlier this month, will become effective on Friday, May 5, 2017. The amendments ease regulatory burdens and reduce the costs of compliance with the agency’s regulations. Carriers and NVOCCs will have additional time under the new rule to correct technical data transmission errors from 48 hours to 30 days and service contract errors from 45 days to 180 days.  The final rule in Docket No. 16-05 is now available on the Commission’s website and will be published in the Federal Register on Tuesday, April 4, 2017. 


The Federal Maritime Commission (FMC) also recently launched a redesigned, more user-friendly Agreements Library. This online library of carrier agreements makes it easier for the ocean transportation industry and members of the public to search for, identify, and review vessel-operating common carrier agreements directly through the Commission’s website.

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The International Maritime Organization (IMO),  the International Tanker Owners Pollution Federation Ltd (ITOPF) and the International Oil Pollution Compensation Funds (IOPC Funds) have launched an exhibition to mark 50 years of successful cooperation between government and industry to achieve a dramatic and sustained reduction in major oil spills from ships; to establish effective systems for preparedness and response if there is an incident and to create a comprehensive mechanism for providing compensation to those affected. It is a story to be proud of. 


A timeline from pre-1967 to the present day covers prevention – including improved safety of navigation, ship construction, training and risk reduction; preparedness and response – an area which has continued to evolve as both awareness and technology have advanced and practical experience has led to a better response to spills when they occur; and liability and compensation regimes, which have been developed to ensure  that a robust system of compensation and liability for ship-source oil spills is now in place and that appropriate funding mechanisms exist to finance an immediate and efficient response and compensate those affected.

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In cooperation with the Technical University of Denmark (DTU), the Danish Maritime Authority has developed a pre-analysis that is intended to inspire other projects that may support the development of autonomous ships.  The pre-analysis briefly summarizes how to define various levels of autonomy. From the lowest level with full manual operation, where the navigating officer gets his information from electronic charts and where he gets information about his own position, course and speed as well as an overview from radar that also presents other ships' course and speed; over increasing levels where automated decision-support takes over; to levels of actual autonomy. This part is based on the experience and knowledge gained from autonomous cars and unmanned aircraft and refers to ongoing reflections from similar ship-related projects.  The report concludes with proposals for specific research and innovation projects that are expected to be of benefit to the Danish maritime industry and Blue Denmark.

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At the opening of the St. Lawrence Seaway this week, CSL unveiled a unique contribution of artwork commemorating Canada’s 150th birthday. Between mid-February and early March of 2017, four urban Montreal artists worked together to create the mural on the forward façade of the accommodations block of the bulk carrier CSL St-Laurent that depicts a Canada goose with its powerful wings spread in flight, its forward motion a tribute to Montreal and to Canada. The Sea Keeper/Gardien des eaux is an original work of art conceived by Montreal urban artist Bryan Beyung and created by Beyung with artists FONKi, Ankh One, and Benny Wilding of the Ashop art collective. The monumental mural was created over a few weeks – a feat which is in itself is worth noting – and required the ingenuity of CSL's Technical Team to make it a success. Painting an original work-of-art of this scale on a ship was a first for the artists, a first for CSL and a first for a Canadian commercial vessel. CSL has also produced a video depicting the making of the mural, which is available at here.

 

 

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The BC provincial government announced on Wednesday that it is taking action under the Climate Leadership Plan to support investments by natural gas utilities that will increase the use of LNG and renewable natural gas in the transportation, marine and other sectors and reduce greenhouse gas (GHG) emissions. Amendments to the Greenhouse Gas Reduction Regulation (GGRR) under the Clean Energy Act will enable utilities to increase existing incentives provided to shipping companies for the conversion of vessels to run on LNG, invest in LNG bunkering (marine fueling) infrastructure, and increase the supply and use of renewable natural gas (RNG). Programs under the GGRR are funded by the utility, not the Province. The amendments are enabling only, and set the parameters for potential utility programs and investments that will reduce GHG emissions. The government asserts that converting just one ocean-going tanker, cruise ship, or container ship to run on LNG instead of heavy fuel oil will reduce GHG emissions by about 93,500 tonnes per year, equivalent to taking over 19,800 vehicles off the road. It hopes that utility investments in LNG fueling infrastructure will help establish B.C. as a marine bunkering centre on the west coast capable of providing LNG to an increasing number of LNG vessels and leading to global reductions in GHG emissions.

 

 

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The Board of Directors of Clear Seas Centre for Responsible Marine Shipping is pleased to announce the appointment of Peter Ellis to the position of Executive Director, effective March 20th, 2017. Peter comes to Clear Seas after a distinguished thirty-one-year career in the Royal Canadian Navy and the Canadian Armed Forces. Prior to his retirement in the rank of Rear-Admiral, he held a variety of operational and institutional leadership roles both at sea and ashore, having served in Halifax, Esquimalt and Ottawa. He has served in over a dozen Canadian ships and submarines, and sailed in several allied warships. He commanded the frigate HMCS Halifax and Canada’s Pacific Fleet. As Executive Director, Peter brings proven leadership to Clear Seas as the organization fulfills its mission to be the leading source of impartial information on marine shipping in Canada.

Peter Ellis, CMM, CD, is a former naval officer who retired from the Canadian Armed Forces at the rank of Rear-Admiral.

 

The Chamber of Shipping welcomes Peter to Clear Seas.

 

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American Club is advising that the Maritime Safety Administrations (MSAs) in Hebei Province and Tianjin Municipality have both reportedly penalized a foreign ship for use of fuel with sulfur content over 0.5%. It is not clear at this stage how the vessel was penalized. It has been reported that, in conducting the supervision and inspection survey of the foreign vessel that arrived at Tianjin Port, the MSA officer suspected that the vessel was using noncompliant fuel. Sampling results showed that the sulfur content of the fuel of that ship was 0.866%, which exceeded the maximum content of 0.5%m/m. This was the first reported case of the usage of non-compliant fuel in the PRC since the second and more stringent stage of control measures was implemented on January 1, 2017. The latest control measure requires ships to use fuel with a sulfur content of no more than 0.5% during berthing at key ports (excluding 1 hour after anchorage and 1 hour before departure).

Following the above referenced publicly reported case, there have been at least two other foreign flagged vessels that have been penalized by the MSA for allegedly using non-compliant fuel.  Vessels are urged to comply with the latest PRC ECA low sulfur content requirement regulations to avoid detention or some form of penalty.

 

 

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This week’s federal budget had some level of focus on transportation and infrastructure but it will likely not satisfy a marine transportation industry facing significant commercial challenges, issues of competitiveness, and an aggressive U.S. marketplace. While the intent of several new initiatives is positive and timely, it is yet to be seen whether or not the government can deliver programming quickly enough to support the competitiveness of Canadian gateways.

 

Transportation. As expected in recent weeks, the budget did lay out information regarding funding envelopes like the new National Trade Corridors Fund. Additionally, the government will allocate $50 million over 11 years to Transport Canada towards the launch of a Trade & Transportation Information System (housed in a new Canadian Centre on Transportation Data). Open-data portal that will provide performance measures and multi-modal data collection/analysis.

 

Infrastructure. Asset divestiture, such as privatizing Canada’s airports and ports, was not in the budget. However, in its expenditure management initiatives, the Government noted it would initiate a three-year horizontal review of federal fixed assets, organized and staged by asset type. While some groups have already raised concerns that Canadians remain “in the dark”, the fact is an extensive and extended review period is yet to come.

Budget 2017 restates the government’s commitment to the Canada Infrastructure Bank, which will provide $5 billion to the above-stated National Trade Corridors Fund (in addition to the $2 billion over 11 years that the Fund is receiving separately). The Bank will soon be recruiting for a new CEO and Board Chair, and will be operational, according to the government, by late 2017.

 

Trade. With respect to trade, the Government reiterated that all significant measures of the Comprehensive Economic and Trade Agreement (CETA) with the European Union are on track to be in force by the Spring. This has been of particular concern to Canadian maritime labour that views CETA as a threat to Canadian jobs. Further to remarks by President Trump and Prime Minister Trudeau earlier this month on U.S. and Canada regulatory cooperation, Budget 2017 outlines a renewed commitment to advancing regulatory alignment in support of trade. The Treasury Board Secretariat, home of the U.S.-Canada Regulatory Cooperation Council, will be receiving an additional $6 million over three years to continue its efforts in supporting business growth by promoting regulatory alignment with Canada’s trading partners.

 

Climate Change and Environment. A number of measures to implement the Pan-Canadian Framework on Clean Growth and Climate Change were included in the 2017 budget. The budget signaled that the government intends to introduce a carbon pricing “backstop mechanism” that will apply in provinces and territories that do not meet the federal government’s carbon pricing benchmark. This will effectively enforce a national carbon price from the federal level. Beyond this, the budget also proposes $67.5 million in funding over four years to Natural Resources Canada to promote energy efficiency programs.

There will be various investments aimed at green transportation measures, such as $56.9 million over four years to Transport Canada to develop new greenhouse gas regulations for the marine, rail, aviation and vehicle sectors, and $17.2 million over five years to develop and implement heavy-duty vehicle retrofit and off-road regulations, as well as a clean fuel standard.

 

 

 

 

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TransCanada has applied to the National Energy Board for regulatory approval that would allow them to start contruction of the North Montney Mainline.The company has received conditional federal and provincial approvals for the NMML, however they are subject to a final positive investment decision by Petronas, the primary backer of the Pacific Northwest LNG Project on Lelu Island in Prince Rupert.  Construction is estimated to cost around $1.4 billion and will connect the NMML project with TransCanada's existing pipeline network, allowing the company to ship the gas to markets across Canada and into the United States.  If regulatory approval was provided, TransCanada could begin construction of the pipeline in the first half of 2018.

 

 

 

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The U.S. Department of Justice antitrust investigators served subpeona's on top container shipping container executives last week while they were in San Franciso to attend the Box Club meeting.  The Box Club includes CEO's of major containers lines and only the heads of each company may participate in it's twice yearly meetings. US antitrust attorneys sit in on the meetings, even when they are held outside the U.S, to ensure that discussions do not go into legally precarious territory such as pricing. Quite often, the group also invites economists or industry analysts to attend. Under limited US antitrust authority granted by the federal maritime regulators, container lines that belong to discussion agreements can meet to discuss and agree on voluntary rate guidelines. The carriers are subject to the DOJ's antitrust prosecution if they exceed this authority by jointly fixing rates.

Companies that have confirmed that they were served subpeona's include Maersk Line, MSC, CMA CGM, Hapag Lloyd, Evergreen and OOCL among others.  At this time no specific details have been released, and it should be noted that a subponea does not mean that a company has engaged in illegal behavior.

 

 

 

 

Dear Members,

The Minister of Finance presented Parliament and Canadians with Budget 2017 this afternoon. Budget 2017, titled Building a Strong Middle Class, offers targeted investments to tackle what it calls the "challenge of change." It offers little new spending, but fleshes out details on where dollars earmarked in last fall's economic update will be spent. While the Chamber will be reviewing the Budget Plan in further detail, some items relevant to the marine sector include:

Trade and Transportation
     • A new Trade and Transportation Corridors Initiative (modeled on the previously Gateway Strategy) that includes:
       o A National Trade Corridors Fund
       o A Trade and Transportation Information System
     • The National Trade Corridors Fund will target congestion and inefficiencies at marine ports such as Vancouver and Montreal, as well as rail road and highways around Toronto and other urban areas. It will invest $2 billion over 11 years. Another $5 billion to be provided through the Canada Infrastructure Bank             (which will be operational by end of year 2017).
     • $50 million over 11 years to Transport Canada to launch a Trade & Transportation Information System (housed in a new Canadian Centre on Transportation Data). Open-data portal that will provide performance measures and multi-modal data collection/analysis.
     • $76.5 million to Transport Canada to fund its operational work on ‘modernizing’ the transportation system, including regulations for autonomous vehicles, new pilot projects for unmanned vehicles/drones, etc)

Infrastructure
     • Regarding the potential for the privatization of ports, the government will launch a three-year horizontal review of federal fixed assets, staged by asset-type.
     • $256 million over five years to facilitate Canada joining the Asian Infrastructure Investment Bank.

Environmental Protection
     • Greenhouse gas regulation coming to the marine, rail, aviation and vehicle sectors, led by Transport Canada, with a proposed investment of $56.9 million over 4 years beginning 2018/19.
     • Development of clean fuel standards to reduce greenhouse gas emissions associated with the use of fuel.
     • New coastal protection measures – protecting 10% of coastal & marine waters.
     • The Oceans Protection Plan was highlighted but no new funding or announcements were attached to it.
     • $5 million for 2017-18 to DFO to support small craft harbours.

Overall, the new Trade and Transportation Corridors Initiative appears to be positive and aligns with the Chamber’s request of government to address issues of competitiveness through improved data transparency, collection and analysis. Notwithstanding, it is yet to be seen whether its development will be sufficiently aggressive to ensure the competitiveness of Canadian Gateways, and more specifically Canada’s marine transportation corridors in a vulnerable commercial marketplace. It is also positive that the government has listened to the concerns of stakeholders and will take a more deliberate and engaged approach to considering the privatization of ports. We will of course be interested to learn more about the intentions of the government around GHG regulations and if it intends to align with efforts of the International Maritime Organization.

Robert Lewis-Manning
President

 

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