January 23, 2013 – Dear Mr. Horter, Executive Director, Dogwood Initiative:

Re: Proposals to Expand Coal Exports to Asia

In late December 2012, I received letters by email from many Dogwood Initiative supporters expressing concerns about the projects proposed by Fraser Surrey Docks (FSD) and by Neptune Bulk Terminals (NBT). These letters were based on a form letter published on the Dogwood Initiative website. I thought it would be helpful to contact you directly to provide clarification on some of the statements included in the form letter. Port Metro Vancouver staff will also email a link to this letter to each of the individuals who took the time to contact us directly.

Fraser Surrey Docks’ and Neptune Bulk Terminals’ Projects

FSD is a multi-purpose marine terminal handling containers, breakbulk and bulk products in the City of Surrey. FSD’s project proposal is to develop a Direct Transfer Coal Facility, which would include handling coal, a new product for its existing terminal. Should this project proceed, coal would be shipped via rail to FSD then loaded to a barge for shipment to Texada Island for overseas export.

NBT handles potash, steelmaking coal, bulk vegetable oils, fertilizers and agricultural products in the City of North Vancouver. NBT’s project proposals include replacing older equipment and updating terminal infrastructure to expand coal capacity at its existing terminal.

Port Metro Vancouver Mandate

Port Metro Vancouver’s mandate is set out in the Canada Marine Act, and includes contributing to the competitiveness, growth and prosperity of the Canadian economy, providing a high level of safety and environmental protection, and managing the marine infrastructure and services in a commercial manner that encourages, and takes into account input from users and its bordering communities. In order to meet this mandate, Port Metro Vancouver upholds the highest standards of project review, dictated by the nature of a proposed project and related to the handling and movement of goods. To learn more about our mandate, please visit the government of Canada’s website.

Background on coal

In 2011, Port Metro Vancouver handled more than 122 million metric tonnes of cargo, including more than 32 million metric tonnes of coal. Approximately 67% of that coal is British Columbia mined metallurgical or steel making coal. This makes Port Metro Vancouver the second largest exporter of coal in North America. Total coal exports through Port Metro Vancouver have grown by 35% from 2009 – 2011. To learn more about port facts and cargo statistics, please visit our website.

Project review & decision making process

Similar to a municipal development approval process, Port Metro Vancouver assesses project permit applications based on best planning practices. Each project application is reviewed on its merits, impacts to local communities, and necessary mitigation measures. A project permit will only be issued by the Port when technical reviews and any required municipal, First Nation, and community consultation are complete. All projects requiring public consultation are posted on our website.

Port Metro Vancouver conducts environmental reviews on all proposed projects within its jurisdiction. Projects with in-water works are referred to agencies such as the Burrard Inlet Environmental Action Program and the Fraser River Estuary Management Program. These Environmental Review Committees conduct coordinated inter-agency reviews for proposed projects or activities that could impact riparian areas and marine environments.

As part of the review process, depending on the specific nature, location and complexity of the proposed project, applicants may be asked to conduct additional studies to assess impacts including but not limited to air quality, habitat, fish and wildlife, soil and water quality, Aboriginal interests, traffic and transportation, noise and light, views and shading, odours, navigation and safety, security, and economic impacts. Some projects may also require review from other agencies such as the Department of Fisheries and Oceans and Environment Canada.

At the completion of this comprehensive review process Port Metro Vancouver makes its decision on the application. If a project permit is issued, it is typical for the permit to include a variety of project and environmental conditions of approval. These conditions will vary on the nature of the project and its potential impacts.

Public engagement

Consistent with the nature and scope of the proposed project, proponents submitting applications for projects on Port managed lands and waters are required to conduct First Nation, municipal and public consultation. Beginning in early summer 2012, both FSD and Neptune began pro-active local community outreach. For both proponents, activities included posting project information on their websites, providing notifications to local residents and businesses (approximately 3,200 from FSD; approximately 1,000 from Neptune), and letters and information packages to municipal, provincial and federal government representatives. For more information about the consultation activities undertaken for these projects, please read the consultation summary reports on our website for Fraser Surrey Docks and Neptune Bulk Terminals’ Additional Coal Handling Improvements and New Stacker Reclaimer Project.

Fugitive dust from rail cars transporting coal to the Port

Port Metro Vancouver has been monitoring coal dust at port terminals since the 1970’s. The Port upholds the highest and best management practices to mitigate fugitive coal dust on terminals. The movement of coal by rail along Canada’s rail corridors is regulated by Transport Canada in accordance with the Railway Act. Port Metro Vancouver has been advised that rail service providers take significant steps to minimize fugitive coal dust, such as spraying each rail car at the mine site with a dust suppressant designed to create a crust on top of the coal.

Public consultation comparison of Washington State and Port Metro Vancouver

The projects proposed by FSD and Neptune are not comparable to the project proposed by Pacific International Terminals, as they do not require the building of new terminals. In fact, neither proposal is considered a designated project requiring a federal environmental assessment under the Canadian Environmental Assessment Act (CEAA) 2012. However, Port Metro Vancouver conducts rigorous environmental and planning reviews regardless of whether or not the scope of the project triggers CEAA 2012.

We encourage you to visit our website for further information on these and other project permit applications. In addition, our Sustainability Report provides details on Port Metro Vancouver’s reporting on sustainability performance and consultation processes. Port Metro Vancouver is only the second port in the world to publish an independently-assured report in accordance with the international best practice standard, Global Reporting Initiative (GRI) Sustainability Reporting Guidelines. We are currently in our

third year of this process. We recognize and respect that port communities require meaningful and ongoing input into the operation and expansion of port facilities, along with transparency in consultation processes and adherence to high environmental standards. We are committed to ensuring that our review of all proposed projects meets these high standards. Nonetheless, there are matters that are beyond our jurisdiction, the scope of our project review process and our mandate. We urge you to raise your broader concerns about the export of coal with the Government of Canada and we have taken the liberty of copying this response to Minister Lebel and Minister Fast.

Yours truly,
Robin Silvester
President and Chief Executive Officer