By Brian Dunn

Montreal Gateway Terminals Partnership (MGT) is celebrating its 50th anniversary this year as it prepares to tackle new challenges in a changing industry environment. The company has been operating since 1970 under different auspices, including Cast Terminal and CP Ships, until 1998 when it became MGT after the Cast and Racine terminals merged operations. In addition to CP Ships, MGT has been owned by Hapag-Lloyd and Morgan Stanley. In March 2015, a consortium led by Fiera Axium Infrastructure Inc. acquired a 100-per-cent ownership interest in MGT from Morgan Stanley Infrastructure Partners for a reported $650 million. The consortium consisted of Fiera Axium Infrastructure Canada II L.P., Desjardins Group, through its insurance subsidiaries and its Pension Plan, Manulife, Fonds de solidarité FTQ and Industrial Alliance. In December, 2015, Fiera Capital agreed to sell its participation in Axium Infrastructure Inc.

The sale to a group of local investors was a vote of confidence for the company, said MGT President and CEO Michael Fratianni at the time of the sale. And they continue to be very active today. “Their interests pretty much align with ours in terms of growing volume in Montreal. And like us, they’re always aware of their environment and social responsibilities.”

Between 2019-21, the company plans to invest $100 million in new equipment and technology improvements, including the purchase of 10 Liebherr electric rubber-tired gantry cranes and four postpanamax ship-to-shore cranes. The ten new gantry cranes have a maximum payload of 40.6 tonnes and can handle six containers. The four ship-to-shore cranes will be able to handle 21 containers across the deck compared to 14 on existing cranes with a capacity of 65 tonnes of payload.

“We are ready for the future with ships in the 6,000 TEU range,” noted Mr. Fratianni, who joined MGT in September 1986, when it was known as Racine Terminal. “My wife sort of got me the job when she worked at CP Rail. My background was in banking and insurance and she sent my CV to HR (human resources) without my knowledge and I accepted a job in one of the company’s subsidiaries.”

For the past few years, MGT has been using the Navis N4 terminal operating system to help optimize terminal productivity and enable further enhancements of service deliveries. N4 allows customers to run their operations from a single terminal to multiple terminals managed from a central location. By consolidating all systems on one platform, the move enables MGT to modernize its IT infrastructure, optimize terminal efficiency, and facilitate ongoing logistics innovations. “The next evolution will be blockchain as another form of expediting data, only in a more secure way,” added Mr. Fratianni.

As a port terminal operator, the challenges for security are multiple, and MGT has several layers of protection as a result, noted Frederic Provost, Vice President Risk Management. “We have managed to centralize the access control of everybody accessing the installations. The truck driver that comes to pick up a container, a crew member that disembarks from the vessel or a longshoreman that comes for his shift, will all be managed by the same centralized access control system, named CCure.” The CCure system is linked to the terminal’s Avigilon camera monitoring system which covers the installation in high definition resolution.

“Another important tool MGT has implemented in the last year is the electronic security report system called Control Perfect. Under the system, security officers log details of all events in the terminals which can be shared instantly with the authorities,” noted Mr. Provost. “This helps us with the different federal authorities in terms of reporting and notifying requirements. This system is also a way to standardize data entry for different kinds of situations and builds a powerful database that would help us find solutions for daily issues.”

MGT handles about 60 per cent of the Port’s international container business through its Racine and Cast terminals, both served by CN and CP. It serves seven global shipping lines, namely CMA CGM, COSCO Shipping Lines, Hamburg Sud, Hapag-Lloyd, Maersk Line, MSC and OOCL. COSCO began calling at Montreal last April from several northern European cities, such as Antwerp, Bremerhaven, Le Havre and Liverpool.

Last year, MGT handled between 950,000-975,000 TEUs, according to Mr. Fratianni, up eight per cent from 2018. The increase was partly attributed to the launch of an exclusive Montreal-Mediterranean service in July, 2018, by Maersk. “It has proven to be very successful in bringing in new volume to the port, including growth in transhipments. For 2020, growth should be closer to 2½ – 3 per cent.”

Asked about major changes in the industry, Mr. Fratianni said the proliferation of containers over the last 30 years has been profound, and now most consumer goods move in containers. “As far as the port of Montreal is concerned, it was essentially a gateway to Europe. Today, the engine of growth is Asia which accounts for about 25 per cent of the port’s volume. The shift of manufacturing to Asia and India has made Montreal more attractive for the North American market.”

Last May, Quebec Port Authority announced the signing of a long-term joint venture with CN and global terminal operator Hutchison Ports to build a $775 million intermodal terminal with container capacity of 700,000 TEUs slated for start-up in 2024. CN said the objective of the project was to capture market share from the Port of New York and New Jersey especially in the U.S. Midwest.

Will it also take market share away from the Port of Montreal, Mr. Fratianni was asked?

“CN has built a case in terms of where the market is going which is predicated on larger ships going to Quebec. The biggest ships Montreal can handle are around 4,500 TEUs and nobody has told us we must expand our capacity. “We operate in a niche market and are doing very well. We remain very competitive in terms of price and service. Our policy is to grow organically through our existing customer base, and we’ve got the top shipping lines in the world calling on Montreal.”