Harper cancels sale of B.C. shipping terminal

The Canadian Press
Tuesday, February 07, 2006

VANCOUVER -- The federal government has cancelled the sale of the Ridley Island shipping terminal in Prince Rupert, B.C., to an Ontario company.

Prime Minister Stephen Harper announced at a caucus meeting in Ottawa on Tuesday that he had signed the papers cancelling the deal with Fortune Minerals Ltd. (TSX:FT) of London, Ont.

The Ridley terminal, built in the 1980s, is an ice-free, deepwater harbour.

It was originally built as a Crown facility by the federal government at a cost to taxpayers of $250 million to load and ship coal from the Quintette and Bullmoose mines at Tumbler Ridge in northeast B.C.

The sale of the port to Fortune Minerals ignited a debate over whether other companies would get fair access to the terminal, something that concerned the provincial government.

As a result, B.C. Transportation Minister Kevin Falcon said the federal government did the right thing.

"I'm not at all unhappy with that (cancellation of the deal),'' said Falcon. ``We're very concerned about the issue of fair and open access to the port facility, so we were working with the federal government to ensure, at minimum, that they had language that would protect all the B.C. interests in having fair and open access to that port.''

The port has strategic importance because it is the western terminus for the CN Railway and the closest port in North America to Asia.

Over the last several years, with coal prices in the dumps and Quintette and Bullmoose shut down, the future of Ridley looked bleak.

The previous Liberal government said it wanted to sell the property because it was costing taxpayers $500,000 a month in subsidies to operate.

But the future of coal has recently brightened, especially due to China's booming economy, which caused other companies to show an interest in the way the terminal is operated.

New coal mines are being developed in B.C. and Alberta and Ridley management estimates that coal shipments will increase dramatically over the next several years.

Last year, only 1.3 million tonnes of coal was shipped and the terminal's capacity is 16 million tonnes.

A group calling itself the Ridley Shippers Coalition and consisting of about five shippers want to run the terminal as a non-profit co-operative. Fortune wanted to run it as a for-profit venture.

Shares in Fortune Minerals dropped three cents to $3.37 on the Toronto Stock Exchange on Tuesday.

© The Canadian Press