COS Weekly Newsletter - Friday, 21 February 2020


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          COS Weekly Newsletter
          Friday, 21 February 2020

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Local News


Time for the barricades to come down

Now into the third week of supply chain disruptions resulting from the Wet'suwet'en hereditary chiefs dispute over the Coastal GasLink pipeline project, the Prime Minister, Justin Trudeau, is calling for the barricades to come down. Requests for meetings from the Crown-Indigenous Relations Minister Carolyn Bennett to the hereditary chiefs are being ignored until the RCMP and Coastal GasLink workers move off the territory.
Two blockades are severely impacting operations Montreal and Toronto and have resulted in CN shutting down is eastern network and laying off 450 workers.  Via Rail served 875 workers with layoff notices with much of the passenger rail network being shut down. Other short-lived blockades in Edmonton and near Kamloops ended following a CN injunction and negotiation with CP respectively.
West coast anchorages are being fully utilized with demand exceeding capacity in the Lower Mainland and Gulf Islands.  The Port of Vancouver is managing the allocation of anchorages to best serve the day-to-day operational needs under the current circumstances.
Earlier this week we co-signed a letter with the Canadian Chamber of Commerce and other key associations seeking the removal of the blockades.

Looming decision on Teck Frontier project

Teck Resources $20.6-billion, 260,000-barrel-per-day project located in northeastern Alberta is hoping for the green light next week when the federal government is expected to make its decision on project.  Teck has indicated that it will take an impairment charge of about $1.13 billion if the federal government rejects its project.

BC Ferries christens Island class vessels

BC Ferries named and christened the first two Island Class ferries this week. The vessels, Island Discovery and Island Aurora, are the newest vessels to enter the fleet and will enter service in mid-2020, serving the Powell River – Texada Island and Port McNeill – Alert Bay – Sointula routes, respectively. The names were selected with community input and celebrate the beauty of the journey and the important connection to the coastal communities the ferries will soon serve.
Island Class ferries have the capacity to carry 47 vehicles and between 300 and 450 passengers and crew, depending on configuration. They are battery equipped ships designed for future full electric operation. The ships are fitted with hybrid technology that bridges the gap until shore charging infrastructure and funding becomes available in BC.  The design of the vessels reduces underwater radiated noise, lowers emissions and improves customer service.




BC 2020 Budget Released

The provincial government released its budget this week and concerns over possible changes to the BC Ports Property Tax Act or Assessment Act were allayed.  The land valuation appreciation will be linked to CPI plus 1 percentage point and municipalities may only have a distinct tax rate for ports when the class 4 tax rate is below the designated port tax rate cap and the new rate for ports cannot be higher than the class 4 rate set in 2017.  This change preserves the tax rate security for terminals by keeping the existing caps and avoiding unintended benefit of reduced tax rates due to non-designated land value increases.  These changes are consistent with the recommendations put forth by the BC Marine Terminal Operators Association earlier this year.

Update on CUSMA Bill C-4

The NDP has agreed to support the federal government’s attempt to fast track Bill C-4, Canada-United States-Mexico Agreement Implementation Act through the House of Commons.  Both the U.S. and Mexico have ratified the agreement, leaving Canada as the only outstanding nation. The deal cannot come into force until all countries pass it.  Bill C-4 is at the second reading stage in the House of Commons.

Canada announces HFO ban for Arctic

The Government of Canada has officially announced their support for a ban on heavy fuel oil in Arctic waters. They will be seeking a phased-in approach to the ban as Canada discusses ways to help balance the environmental benefits with the economic realities of northern, Indigenous and Inuit communities with IMO countries. The decision is based on conclusions from Transport Canada’s domestic impact assessment of the proposed heavy fuel oil ban in the Arctic, which can be found here: Let's talk marine fuel in the Arctic.

Ministerial Order on train speeds revised

As noted last week, the Transport Minister issued an order that reduced speed for trains carrying 20 or more cars by half.  This slowdown caused railways to loose nearly a third of their capacity. A revision to the Ministerial order was made on Monday following review.  The new speeds for trains either carrying a single dangerous goods commodity moving to the same point of destination or those that include any combination of 80 or more tank cars containing dangerous goods are set at:
  • Metro areas: 48 km/h or 40 km/h in non-signalled areas.
  • Non-metro in areas where there are track signals: 80 km/h.
  • Non-metro in areas where there are no track signals: 40 km/h.
Trains carrying 20 or more cars containing dangerous goods, or a train carrying one or more cars of toxic inhalation gas.
  • Metro areas: 56 km/h.
  • Non-metro in areas where there are track signals: 80 km/h.
  • Non-metro in areas where there are no track signals: 64 km/h.
Unfortunately, another derailment of a train carrying crude derailed west of Fort Frances, Ontario shortly after the order was revised   33 CN rail cars went off the tracks with three tank cars confirmed to be partially leaking oil.


US News


Canada and US Sign Plan for Dixon Entrance

US and Canadian Coast Guards came together in Juneau this week to sign the newly revised Dixon Entrance Annex to the national Canada-United States Joint Marine Pollution Contingency Plan. The updated annex includes basic content and format changes in accordance with new national guidelines, clearer pollution notification and response protocols, and refreshed references to U.S. Customs Service procedures for transboundary movement of personnel and resources. It also incorporates organizational changes within the two Coast Guards.

US-Mexico rail link for Houston

The Kansas City Southern of Mexico (KCSM) line is planning to open an inland port, increasing rail options between the US and Mexico. The 540-acre Southwest International Gateway Park is located on the main KCSM northbound line about 60 miles southwest of Houston. The park will give shippers a more direct and efficient route into the Houston market, and potentially lower costs. The park also seeks to help exporters in the booming Gulf Coast resin sector, creating an alternative departure point through which area resin manufacturers can send shipments to Mexico by rail, and to Asia through Mexican ports.


International News


Huge impacts from Coronavirus

The effects from the Coronavirus (COVID-19) have started to have a negative impact on a number of shipping-related industries and markets, from the dry bulk market, to the tanker and from ship-repair businesses in China, to crew-training schools in the Philippines. Oxford Economics warned that the spread of the virus to regions outside Asia would knock 1.3% off global growth this year, the equivalent of $1.1tn in lost income.
The travel and tourism industry will face the biggest hit.  Royal Caribbean Cruises has cancelled 18 cruise sailings in Southeast Asia and modified several itineraries due to travel restrictions aimed at containing the coronavirus. It is estimated that cruise bookings are off by as much as 15 percent. China has been one of the travel industry’s biggest growth markets in recent years, and, trips in the Asia-Pacific region make up about 10 percent of the industry, according to the Cruise Lines International Association, a trade group. Between 8 and 9 percent of passengers on cruise lines represented by the trade group are from China, Macau or Hong Kong and the number of ships deployed in Asia grew 53 percent between 2013 and 2017.

BIMCO joins Japan in seeking regulate carbon emissions from existing ships

Several parties are joining Japan in their proposal to regulate the carbon intensity of existing ships through use of an Energy Efficiency Existing Ship Index (EEXI), much like the Energy Efficiency Design Index (EEDI) which is mandatory for new ships. The proposal offers a simplified way to comply by using estimated speed/power curves and power limitation. Together with Greece, Japan, Norway, Panama, The United Arabic Emirates, ICS, INTERTANKO and RINA, BIMCO is proposing a comprehensive package of amendments to MARPOL Annex VI and associated guidelines for calculation of EEXI and application of Engine or Shaft Power Limitation. The package will require existing ships to comply with the energy efficiency limits of new ships at the time of adoption.

Ghost ship washes ashore in Ireland

Ghost ship, MV Alta, ran aground on the Irish coast after drifting for over a year at sea. The vessel’s 10 crew members were rescued by the US Coast Guard back in September 2018. The Tanzanian-flagged ship became disabled while underway from Greece to Haiti in September 2018, and its crew members were unable to make repairs. The crew was reportedly stuck on the ship in the middle of the Atlantic for almost 20 days. The hull of the vessel reportedly remains intact. Contractors are now in the process of completing a risk assessment, though there is no visible visible pollution within the Ballycotton Bay Special Protection Area or the nearby proposed natural heritage areas.

PIL withdraws transpacific service

Pacific International Lines’ (PIL) is withdrawing its services from the transpacific market. The Singapore line’s last transpacific sailing will be in March and the Canadian offices closes its doors next week. The decision comes as part of a wider strategic review at the SS Teo-led company which will see PIL, the world’s ninth largest liner, focus on strengthening its position in the North-South trades such as Africa, Middle East / Red Sea, India Sub-Continent, Latin America, and Oceania.


Upcoming Events


Feb.25 - Vancouver Grain Exchange Board Meeting

Feb.26 - PACMAR/NANS Committee Meeting

Feb.27 - Vancouver Shipping Lunch

Feb.28 - COS Annual General Meeting

Mar. 4 -  Regional Canadian Marine Advisory Council Meeting

Mar. 5  - VMAA Board of Directors Meeting

Mar. 5 -  Plimsoll Club Pub Night

Mar. 6  - IIMS Canada Conference Canada

Mar.17 - ISSC Board of Directors Meeting
Mar.28 - COS Liner Committee Meeting

Apr. 3  - IMDG/TDG Dangerous Goods Training Course



Ship of the Week


Feb 21 - Ronja Islander

Grieg Seafood’s newest vessel, the Ronja Islander, completed construction in Norway in late 2019, and was custom built to address some of BC’s salmon farming challenges, including sea lice and safe fish handling during live transfers to farms. The vessel was designed using input from our stakeholders and Indigenous partners. In addition to its state-of-the-art removal treatments for sea lice, the process features 100% capture of the detached lice which will be disposed on land. The CAD $40 million wellboat will operate on both coasts of Vancouver Island, servicing 16 of Grieg Seafood’s salmon farms.  
Length: 69.86 m
GT: 1850
Built: 2019
Capacity: accommodations for up to 12 crew members