1

Maritime Awards Society of Maritime Awards Society of CanadaCanada

Oceans Governance on Canada’s Oceans Governance on Canada’s West CoastWest Coast

Shipping Industry PerspectiveShipping Industry Perspective

Dunsmuir LodgeDunsmuir LodgeUniversity of VictoriaUniversity of Victoria

Rick BryantChamber of Shipping

June 8, 2007

2

Outline

• Overview of West Coast Shipping Activity

• Emerging Issues Drivers and Concerns in Marine Transportation

• Governance of Shipping

3

Marine Industry Economic Impact in Canada

Source - LeCG - Estimating Economic Impact of the Canadian Marine Transportation Industry – March 2004 – Preliminary Draft

Direct + Indirect Contribution to GDP(3751 Million Dollars)

77309

157

699

757

1449

124

1118150

NF PEI

NS NB

QUE ONT

MAN SASK

AL BC

BC

ONTARIO

QUEBEC

Maritimes

BC economic

impact 38%

4

Value of Trade Commodities(Billions of Canadian dollars)

  MarineAll

ModesTrans-border      

   Exports 13.57 347.89

   Imports 2.69 208.65

   Total U.S. 16.26 556.54Other countries

     

   Exports 40.57 63.68

   Imports 60.67 146.06

   Total 101.24 209.75

Total value of commodities shipped = $117.5B

Approximately 40% of the activity is in BC

5

Flag Shares of Shipping Volumes

95.4

50.2

40

99.9

4.5

0102030405060708090

100

Domestic Transborder Foreign

Pe

rce

nta

ge

of

To

tal

Canadian Flag US Flag Foreign Flag

Domestic shipping regulated by Coasting Trade Act – 95% Canadian

Trans-border shipping open competition – 50% Canadian

Import/Export open competition – 99.9% Foreign

6

Shipping and Growth in Global Trade

Key Average Global Growth Indicators (1990 -2004)

% Change

GDP 3.3Trade 6.4Container volume 8.9

Source: Cosco/ Drewry

7

International Shipping in BC

Bulk CarrierGeneral Cargo

Container Ship

TankerVehicle Carrier

Cruise Ship

Number of Voyages in BC, by Vessel Type

General Cargo,

482, 14%

Motor Vehicle Carrier, 228, 6%

Tanker, 267, 7%

Bulk Vessel,

1217, 34%

Container, 915, 26%

Cruise Ship, 434,

12%

Misc, 22, 1%

8

Coastal TowingThe Canadian Transportation Agency

estimates that the Canadian fleet of tugs and barges included 328 tugs and 1,203 barges and scows

9

Ferry Services in Canada

BC Ferries: 2004

• 22 million passengers

• 8.6 million vehicles

BC MOT

• 7.2 million passengers

• 3.3 million vehicles

La Société des traversiers du Québec

• 5.4 million passengers

• 2.7 million vehicles

Marine Atlantic

• 417,500 passengers

• 207,000 vehicles

10

Cruise IndustryCruise Ship Passengers

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1999 2000 2001 2002 2003 2004 2005 2006

Victoria

Prince Rupert

Vancouver

Drop in Passenger Count in

Vancouver offset by growth in

Victoria and Prince Rupert

New opportunities in Cruise BC

11

Marine Traffic Vessel Density Coast of British Columbia 2003 

Source: Canadian Coast Guard

12

Emerging Issues

Driving Factors and Concerns

• Competition; For markets, between modes and between carriers

• Infrastructure capacity lagging trade growth• Sub-optimum performance of inter-modal

logistics system due to lack of integration • Fragmented marine policy and regulatory

responsibilities • Concerns over labour continuity and labour

supply• Threat of terrorism• Increasing environmental concerns• Poor public image and lack of awareness• Slow uptake of technology and innovation

14

Growth in Trade(Bigger Safer Cleaner Ships)

WESTAC commodity forecast projects significant growth in bulk and container shipping through 2015

• Bulk exports led by coal increase at 4%/year– 2004 - 63 million tonnes – 1200 ships– 2015 - 96 million tonnes – 1600 ships– Average size 50,000 dwt to 60,000 dwt

• Containers up 300%– 2004 1.8M TEU – 915 ships– 2015 5.4M TEU – 1350 ships– Average 2000 TEU to 4000 TEU

15

Environmental FootprintNational Marine and Industrial Council footprint issues

Areas Examined– Marine Air Pollution– Oil and Chemical Spills– Oily Wastes– Sewage Discharge– Other Wastes

Factors Considered– Current status of regulations, technology and action– Obstacles to reaching desired outcomes– Opportunities for government and industry

– Aquatic Invasive Species

– Port Development– Physical Impacts– Ship Recycling

16

BC OGV Contribution to GHG in Canada

758.0

1.3

CO2 Emissions

• Canada produced 758 mega tonnes (mt)of GHG in 2005, 2% of total global emissions.

• OGV emissions within 50 nautical miles - 1.3 mt

• Total marine activity approximately 1.8 mt in BC

• Growth roughly tied to trade volume

0.17%

17

North Coast TankersKitimat identified as site for three new tanker

trades• LNG - 120,000 dwt tankers - 5 per month

• OIL - 5 VLCC tankers per month

• Condensate - 20 ships per year

• Safety Considerations– Oil tankers are new with double hull and twin propulsion and

steering– New powerful tugs for berthing, escort and firefighting– Pilots, ships crew and tug crews trained as a team– LNG shipping – 80,000 transits without a major incident– World-wide tanker incidents dropped from 1000 in 1979 to

160 in 2006

18

Flags of ConveniencePort State Inspection Programs

(Reputation is worse than reality)

Excellent Performance

• Bahamas• Bermuda• China• Liberia• Marshall Islands• Philippines• Korea

Poor Performance• Bolivia• Cambodia• Georgia• Honduras• North Korea• St. Vincent• Tonga

19

Governance of Shipping

20

Industry Expectations in Ocean Management

• Full engagement in process• Clearly articulated expected outcomes• Coordinated single entity inter-departmental

government action• Best use of existing mechanisms• Consistency for all areas and between

applications• Adequate lead time for implementation• Clear and simple compliance requirements• Consistency with International Convention• Predictability of operational costs and risks• Risks linked to international insurance

practice and available coverage• Equity between carriers of all flags

21

International Maritime Organization (IMO)

• IMO founded in 1958 as a specialized agency of the United Nations responsible for measures to improve the safety of international shipping and to prevent marine pollution from ships.

• Member governments create international conventions that are enforced through domestic law that embody the regulations in the convention

22

Key IMO ConventionsSafety• Safety of Life at Sea • Load Lines• Preventing Collisions at Sea• Training Certification and Watch-keeping• Removal of Wrecks

Environment• Prevention of Pollution• Ocean Dumping• Anti-fouling• Ballast Water

Liability and Compensation• Civil Liability for Oil Pollution• International Fund for Compensation• Bunker oil Damage• HNS Liability

23

IMO Conventions Links to Oceans Management• Ocean Dumping – designation of areas.• AIS and LRIT – ship tracking• Ship Routeing Systems – traffic lanes• Vessel Traffic Services – mandatory

management• Removal of Wrecks – removal criteria• Places of Refuge – risk assessment and

selection• Sensitive Sea Areas – designation• Areas to be Avoided – designation• Sulphur Emissions Control Area - designation

24

Particularly Sensitive Sea Area Designation

A sea area where oceanographical, ecological and traffic conditions exist that require mandatory methods for prevention of pollution by oil, noxious liquids or garbage

Criteria for application to IMO – MEPC• Habitats of rare, threatened, or endangered species• Ecological processes of such areas are highly

dependent on biotically structured systems• critical spawning or breeding ground• highly susceptible to degradation by natural events or

the activities of people.• evidence that international shipping activities are

causing damage

25

GUIDELINES ON PLACES OF REFUGE

Masters and Salvors• Appraisal of the situation • Identification of hazards and assessment of risks • Identification of required actions • Contacting the authority of the coastal State • Establishment of responsibilities and communications• Response actions • Reporting proceduresGuidelines for actions expected of coastal States • Assessment of places of refuge • Event-specific assessment • Decision-making process for the use of a place of refuge

26

Use of TermpolTERMPOL• a multi-agency project assessment

managed by Transport Canada that requires proponent to identify pollution risk of new terminal operations and to identify and implement mitigation measures

TERMPOL could be used to create preconditions for projects of a particular type such as oil export terminals specifying pilotage, tug, VTS, navigation aids and other requirements