Transport Committee on Sept. 26th, 2018

[Marko Dekovic]

No. I think there is an opportunity for more backhaul. The only comment I would add is that Zoran mentioned containers that go into eastern Canada also as a gateway port. A lot of that cargo ends up in the United States. A lot of the cargo ends up in the U.S. Midwest as well.

[The Chair, Liberal, Judy Sgro]

Mr. Badawey is next.

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

I have to say that I've had the pleasure of working with some of you in the past, especially Zoran, with the port authorities, and stretching out from Halifax all the way down here to the west and everything in between.

My question is going to be relative to that, because I've been harping all day on the need for national collaboration—regionally, of course, but nationally and to some extent even internationally.

With that, I'm going to give you the opportunity, Zoran, to speak about some of the initiatives that the port authorities are collaborating toward right now, especially related to integrating the logistics and distribution system across Canada and, of course, into the international markets.

[Zoran Knezevic]

I mentioned to you earlier—and I'm glad that you actually had a session yesterday and included the port of Hamilton. Our friend Ian Hamilton from the port of Hamilton is in agreement with the idea of having more collaboration on a regional cluster of levels of ports, which I too believe should be the case.

I think we have four fairly identified regions in the country. We have Pacific, we have Great Lakes, we have the St. Lawrence Seaway, and we have Atlantic apart. I believe a greater collaboration between the ports and the stakeholders in the industry should occur and potentially may be sanctioned by the federal government through the port modernization process that it is doing right now.

[Vance Badawey, Liberal, Niagara Centre, ON]

With that said, we spoke yesterday in Niagara about the—I'll use the word “archaic”—mandate that is being imposed upon some organizations. I know the St. Lawrence Seaway is part of that, as well as some organizations here that may be part of that in terms of mandates that are imposed on them by either the federal government or other entities.

Do you see a lot of that hindering future growth, especially as it relates to not only today, but 30 to 50 years down the road in terms of your corporate strategies? Do you see mandates having to be changed so that both collaboration and the integration of those logistic and distribution sectors are more doable?

[Zoran Knezevic]

The way I see it, I think the port of Vancouver and the industry on the west coast, especially the Lower Mainland and Vancouver, have done a really good job in setting up especially the Asia-Pacific gateway, in my opinion. The Asia-Pacific gateway should be a really good example of the result of collaboration in the industry here.

However, I think the landscape has changed and we are moving forward. I think what I like to call the Asia-Pacific gateway 2.0 is needed. It will require some changes to the way we look at things right now, because the landscape has shifted tremendously, especially with the volume of cargo that we are moving, the challenges that we are facing, the ship size that is coming our way, and also the market share that we are slowly, I believe, losing on the west coast, especially in the container business, because everybody is chasing that mighty container, starting from our neighbours in Seattle and Tacoma and the east coast.

Just to mention it, each container brings about $1,600 to the local economy. I think with each container we lose, we lose a lot. We need to work collaboratively as a whole to make ourselves more marketable to the world.

[Vance Badawey, Liberal, Niagara Centre, ON]

With that, and looking at the success, quite frankly, that's happening out here in the western end of the country, do you see an opportunity to work with other jurisdictions out to the east in Halifax, Montreal, and even into the U.S. markets, in New York, Albany, Manhattan, Staten Island ports, Allegheny, and the list goes on—Cincinnati, Cleveland, Detroit? Do you see an opportunity to work closer together to enlarge that footprint of transportation success to then therefore add to our ability to move trade around the world?

[Zoran Knezevic]

Absolutely. I'll give you an example.

I was talking to my colleague from Thunder Bay. Thunder Bay has a great amount of storage space for grain. I said, “Tim, why aren't you moving more grain through here?” He said, “I don't know, Zoran. People don't want to move grain through the Great Lakes.”

I have been hearing, even today, that people want to move grain on the west coast, even when it's destined for Europe. To me it does not make any sense. I think we as a community, as an industry, have an opportunity to maximize our facilities. Instead of building more here, we have perfectly usable facilities in Thunder Bay for grain, and the grain is not going that way. I think we can influence that.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go on to Mr. Liepert.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

I only have three minutes, so I'm going to try to get some comments from anyone who wants to comment, but I want to start with Mr. Eshleman.

We see the environmental extremists lighting their hair on fire relative to the exportation of bitumen or oil out of the west coast. I see Kinder Morgan is one of your members. We had testimony when we were in the St. Lawrence Seaway area that if these extremists were really concerned about what is being shipped today, they would be astounded with the kinds of stuff that goes on boats. That isn't on a double-hull boat, for starters, so if anything every happened, it would be catastrophic, and yet it ships safely.

Could you make some comments on that?

The other thing, if you could make a comment on it, is it's my understanding that even though we as Canada have decided we don't want to burn coal anymore, coal shipments, especially from Alberta, going through your port here in Vancouver are increasing dramatically and going to Asia, where they're burning the same coal that we could be burning here. I would just like a couple of comments on how we could be shooting ourselves in the foot.

[Brad Eshleman]

I have a couple of comments.

One is a clarification comment. The Kinder Morgan member that's on our list here is actually Vancouver Wharves. It's not the facility in Burnaby.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

It's not Burnaby.

[Brad Eshleman]

That's right. It's Kinder Morgan, but it's Vancouver Wharves. The Burnaby facility is not a member of our association—

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Fair enough.

[Brad Eshleman]

—so it's probably not appropriate for me to comment on that particular item.

With respect to the coal being shipped out of B.C., a lot of coal being shipped—there are different types of coal, obviously—is metallurgical coal, the coal used in the production of steel. Given the manufacturing around the world, that coal is going to be in increasing demand in the world with respect to building infrastructure and producing steel and manufacturing products. You'll see an increase from that product alone.

With respect to the other type of coal that goes into use for energy generation—again, I'm not an expert on coal, but we have had some discussion on this—in Japan, given the earthquakes and the issues with respect to nuclear power, they've spent a lot of money looking at technology, emissions, and different types of technological solutions to deal with the burning of coal. My understanding is that there has been an increase of coal going into Japan also. Their technological side of it has improved the emissions side of burning coal in Japan.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

I'd just like to stop you because—

[Brad Eshleman]

Yes.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

—I know that, Zoran—I can't pronounce your last name—you were nodding your head during my question. Do you have anything to say?

[Zoran Knezevic]

In response to the subject of Kinder Morgan and the safety of the ships, I'd like to say that I was part of establishing, with Mr. Stewart from the Canadian Marine Pilots' Association, the process of escorting those tankers out of the Burnaby facility. I believe strongly that we have a really strong and very good process of escorting those tankers and ensuring that they are safely moved out of our waters. I believe that the B.C. Coast Pilots and the port of Vancouver have done a great job. The B.C. Coast Pilots and Pacific Pilotage Authority especially have done a great job in creating a safe process.

I'm not sure if they've done a great job in communicating that to the public. However, the process is in place. I want to use this opportunity to emphasize that.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Do I have any more time? Okay.

I have a question, Madam Chair.

Are there any comments about the trucking industry on this whole issue of what we're carrying, how safe it is, and all that sort of thing?

[Gagan Singh]

Are you using it for—

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Just about anything. How does it compare to trucking oil, as an example?

[Gagan Singh]

No, it's very hard to move oil on trucks, due to the liquid thing with the oil. It's not safe.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Okay. Then it's not an issue that you have to deal with.

[Gagan Singh]

It's not a safe thing.