By KEITH NORBURY
Port of Vancouver has set a target date of 2022 to begin construction of its long-proposed multi-billion-dollar Terminal 2 on Roberts Bank with the first phase of the container terminal opening in 2028. “That is, of course subject to permitting requirements,” said Duncan Wilson, the Port’s Vice-President of Environment, Community and Government Affairs. That includes Canadian government approval of the project as well as authorization under the federal Fisheries Act, Mr. Duncan said in a recent interview. Those remain big ifs.
Assessment agency working on report
As of Aug. 27, 2019 a review panel of the Impact Assessment Agency of Canada had “closed the public record” for the project’s environmental assessment and began work on preparing a report for the Minister of Environment and Climate Change. The panel has an abundance of material to consider. The agency’s impact assessment registry has 1,425 documents in its Roberts Bank Terminal 2 file. Nevertheless, Vancouver Fraser Port Authority expects the report to be submitted by the early spring.
Dozens of organizations, including about 30 First Nations, several environmental groups, and business organizations submitted documents. Among them is Global Container Terminals Inc., operators of the existing Deltaport container terminal at Roberts Bank, which has its own proposal for expanding its facility.
A scan of the submissions indicates that most — including that of Global Container — express serious concerns about the project and its potential impact. But not all. The Port Authority cites letters from nine First Nations among those 1,425 documents that support the Terminal 2 project. They include the Lyackson, Tseycum, Lake Cowichan, and Tsartlip First Nations. Also on the list is the Cowichan Tribes, which noted commitments made in a mutual benefits agreement with the Port Authority.
Tsawwassen First Nation lists concerns
Notably absent from that list is the Tsawwassen First Nation, whose territory is right next to the proposed container terminal. Tsawwassen Chief Ken Baird declined an interview. Communications manager Adrian MacNair said that’s because the First Nation is in negotiations with the Port. “TFN needs to ensure that its treaty rights are fully respected, and to the letter of the law,” MacNair said.
However, in its 48 pages of closing remarks to the environmental assessment review panel in August, the Tsawwassen First Nation said the project “has created real concerns” for its members about “potential adverse impacts to the connections, values and way of life that support their distinctive cultural identity as the ‘People facing the sea.” The Tsawwassen submission said the project will have “severe adverse impacts” on the First Nation and its treaty rights and that there is a lack of information to support the Port’s position that T2 “will have negligible impacts on certain environmental components.”
The proposed Terminal 2 project is for a three-berth container terminal built to the southwest of Westshore Terminals Ltd.’s Roberts Bank coal terminal, which itself is to the southwest of the existing Deltaport container terminal. The new Terminal 2 would connect to the mainland by the same causeway that serves the existing terminals but which would be widened to handle the additional traffic.
Cost estimated at $2 billion to $3.5 billion
The Port Authority estimates the cost of Terminal 2 at more than $2 billion, with President and CEO Robin Silvester telling Bloomberg News in December that the cost could reach as high as $3.5 billion. Initially, the new terminal will handle the equivalent of 1.6 million standard shipping containers, or TEUs, each year but could expand to 2.4 million TEUs annually. “We’re planning to bring it on in phases so we don’t flood the market with capacity all at once,” Mr. Wilson said. “The timeline for when the additional incremental capacity would come on will be driven by market needs.”
The Port Authority says the new terminal is needed to meet increasing demand for containers in the Vancouver gateway, which will exceed the capacity of its existing terminals by the mid 2020s. (A leading opponent of the project — Roger Emsley of Against Port Expansion — disagrees.) “It’s particularly important to Western Canadian-based exporters who are dependent on this gateway and really don’t have another outlet,” Mr. Wilson said. “If you’re a retailer in Toronto, maybe you can find a way of bringing in your goods in another reasonable way. But if you’re in Western Canada, you’re really dependent on Canada’s West Coast ports.”
Competing terminal proposal
Global Container Terminals Inc., which operates Deltaport, has its own proposal to meet that extra demand. It plans a fourth berth known as DP4. However, the Port Authority has rejected DP4 in favour of Terminal 2.
Global Container Terminals, a.k.a GCT, isn’t backing down though and is “continuing to advance” DP4, said Jennifer Perih, GCT’s Manager of Corporate Affairs. “We believe it is the most responsible, incremental, and appropriate solution to container terminal capacity in the Vancouver gateway. Other proposals come with undue risk to taxpayers and the environment,” Ms. Perih said by email. In issuing a refusal letter on March 1, 2019 to the DP4 proposal, the Port Authority “demonstrated bias as a regulator,” Ms. Perih said. GCT filed a judicial review of that decision on March 28, 2019. “We expect a favourable court decision that will allow us to progress the Berth 4 project without the continuing resistance from VFPA.”
The refusal letter noted that completion of Deltaport’s berth 3, or DP3, in 2010 increased Deltaport annual capacity by 600,000 TEUs. Its capacity is now 1.8 million TEUs per year.
The Port Authority’s Mr. Wilson said he couldn’t speak specifically to the DP4 project because it’s under judicial review. “But under the new Impact Assessment act, a project like that would be reviewed by the impact assessment agency. And any permits that would be required by the Port Authority would wait until that federal review is complete,” Mr. Wilson said.
However, he did leave the door open to a Deltaport expansion down the road, citing the Port Authority’s mandate to facilitate Canada’s trade and ensure adequate capacity. “So if we see that beyond Terminal 2, there’s continuing to be a need for expansion, we will obviously work to bring that capacity online, potentially with existing terminal operators or in the new facility,” Mr. Wilson said.
As it stands, though, one specification the Port Authority has made regarding T2 is that the successful proponent cannot have more than a 60 per cent share of the container market in the Vancouver gateway. GCT currently has a 73 per cent market share, he said. That doesn’t make GCT ineligible but “it would mean they would probably have to divest of another terminal or something,” Mr. Wilson said.
Competitor alleges port bias
GCT responded that the Port’s information is misleading. At the end of 2019, GCT says, it had a 69 per cent market share in the area under the Port Authority’s jurisdiction and only 51 per cent if the gateway, including Prince Rupert. GCT also finds the premise of the specification to be questionable.
“If any terminal operator in the Port of Vancouver is successful in growing its volumes and thus market share, are all terminals then going to be prevented from expanding when they hit certain thresholds arbitrarily established by VFPA?” Ms. Perih said. “That would send a message that VPFA is not a safe harbour for investment and growth. Perhaps that is why VFPA is having a hard time identifying a terminal operator for their proposed RBT2 project.”
As is the case with other container terminals in the port, the Port Authority will lease the land to an operator, Mr. Wilson said. “Effectively, we build the land mass and a private terminal operator will build and operate the terminal and that terminal operator will compete and ensure a competitive market amongst the broader group of terminal operators on the coast,” Mr. Wilson said.
As noted on the Port of Vancouver website, a Canadian Port Authority is structured like a public company except it has no shares, but is owned by the federal government through Transport Canada.” GCT says the Port Authority is not only its landlord and regulator, but is also a competitor and “cannot help but be biased in its role as a regulator,” Ms. Perih said.
For Terminal 2, the Port Authority hasn’t yet decided on whether it will do a single or split procurement, let alone who will build and operate the facility. “In the case of a split procurement there will be one procurement for the infrastructure, the developer, and another process to select the terminal operator,” Mr. Wilson said. “In the case of a combined one, it would be probably a collaboration between a terminal operator and an infrastructure developer and it would be done as one.”
The Port Authority has been working on Terminal 2 since 2003 and for the last six or seven years on the project’s current version. In recent years it has explored different market structures and is still doing market research into that. “The length of the environmental assessment process ended up delaying the project so far into the future that we really wanted to get back out there again and retest the market and understand what current thinking is before we launch our new procurement,” Mr. Wilson said.
Environmental risks alleged
GCT and the Port Authority each argue that the other’s project presents greater environmental risks. The port’s refusal letter, for example, says DP4’s 56-hectare expansion would extend “well beyond the footprint on the very same intertidal habitat which was specifically protected by the reduced footprint of the DP3 Project to address the opposition of DFO to impacts on what they regarded as critical intertidal habitat.” Meanwhile, GCT President and CEO Doron Grosman, in his closing remarks to the Terminal 2 review panel said Terminal 2 “will result in significant adverse environmental effects that cannot be mitigated and are not justified in the circumstances.”
That wording was similar to that of other Terminal 2 opponents, such as the group Against Port Expansion. Among the adverse effects cited are that Terminal 2 would disrupt salinity and interfere with production of biofilm, which western sandpipers and other seabirds feed upon on the Roberts Bank mudflats. An April 15, 2019 submission to the review panel from Environment and Climate Change Canada, a.ka. ECCC, also makes that argument. “Due to what ECCC believes to be high and unmitigable risks to an entire species of migratory shorebird, ECCC advises that only a Project redesign would avoid geomorphological processes on Roberts Bank impacting biofilm.”
Against Port Expansion is a leading opponent of the project and has presented a long list of objections. Executive Director Roger Emsley said its top issue is that the project involves building a man-made island “in what is recognized as the richest ecosystem on the whole of the west coast and labelled by BirdLife International as a top important bird area.”
Second on Mr. Emsley’s list is that the project threatens eel grass, which provides cover for juvenile salmon, which grow to become a critical source of food for endangered southern resident killer whales. And third would be the impact on crab harvesting by members of the Tsawwassen First Nation.
Should the Tsawwassen First Nation reach an agreement with the Port Authority to build Terminal 2, that wouldn’t “make any difference at all,” Mr. Emsley said, citing the findings of the ECCC scientists.
For its part, the Port Authority argues that Terminal 2 will be built 5.5 kilometres from the shoreline in deep water, “thereby reducing effects to the surrounding sensitive marine environment.” The Port is also leading a program introduced five years ago — Enhancing Cetacean Habitat and Observation, or ECHO — to study impacts of ship noise on whales. As a result, more than 5,000 ships “have voluntarily slowed down in, or moved away from, important southern resident killer whale feeding areas,” said a recent news release from the Port.
Tsawwassen First Nation has 33 recommendations
The Tsawwassen First Nation is a long way from an agreement if closing remarks to the panel are any indication. Among the many Tsawwassen concerns are that the project will have an impact on endangered killer whales, which are of unique cultural significance to the Tsawwassen people’s way of life. The closing remarks included 33 recommendations, which “should not be taken as indication that these recommendations will be adequate to address the concerns raised by TFN.”
The recommendations include requiring the port to “submit a TFN-specific cultural and community mitigation and offset plan, co-developed with TFN”; that Canada “establish and fund a government-to-government oversight body for the Project, inclusive of TFN”; that the port “complete an assessment of alternatives regarding locating the intermodal yard on the mainland adjacent to Deltaport Way, including an evaluation of the benefits of such an alternative for mitigating TFN concerns.”
As its name implies, Against Port Expansion opposes any expansion at Roberts Bank. However, if he had to choose, Mr. Esmley said he’d prefer DP4. “First of all, they’re not building a man-made Island,” Mr. Emsley said. “Their expanded causeway would cover over an area of biofilm and we have been in discussions with them about altering that causeway configuration so that it doesn’t. And GCT will only build this when there’s a business need because they’re in business to make money.”
That’s unlike the Port Authority, which Mr. Emsley called a “bloated government agency.”Mr. Emsley also disputes the Port’s case that Vancouver is about to run out of terminal capacity, citing expansions at DP World’s Centerm, and GCT’s plans to expand its Vanterm operation. If the West Coast does need more container terminal capacity, the best place is Prince Rupert, “because the environment and the ecosystem is very different,” he said. His arguments in favour of that include those put forward by Port of Prince Rupert itself, which include its closer proximity to Asian markets.
Also making an economic argument, of sorts, against Terminal 2 is the International Longshore & Warehouse Union local 502. “Simply put, RBT2 make(s) no sense if on the one hand the construction of the project is found to be environmentally sound while the actual operation of the terminal causes significant job loss and harm to the community and the larger economy,” wrote President Tom Doran in the local’s closing remarks to the panel.
The union also takes a shot at DP4. “We take no position in this very scenario where from our perspective there are two powerful proponents battling for supremacy while working people and communities are trying to avoid being trampled,” Doran said. “Therefore, we cannot support either proponent unless the questions of economic and social impact can be resolved.”
Not every group opposes the project. In its closing remarks to the review panel, the B.C. Chamber of Commerce expressed the opinion that “the Port Authority is well-positioned to deliver this needed container capacity as part of their ongoing effort to maximize the many existing competitive advantages offered by the Port without significant negative effects to the environment.”
Judging from the volume of submissions to the review panel, the project faces fierce opposition, though. Even if the Port can get all the First Nations on side, there’s no guarantee that the project won’t encounter obstacles. The Coastal GasLink pipeline in northern B.C. and the Trans Mountain pipeline in the southern part of the province all have benefits agreements with elected First Nation councils. Yet they’re facing blockades and court challenges from hereditary First Nation chiefs and their supporters. “We’ve been watching that story with great interest, obviously,” Mr. Wilson said of the Coastal GasLink drama, which of late has included blockades of a Via Rail line in eastern Canada and of the B.C. Ferries terminal at Swartz Bay on Vancouver Island. “I think that the nature of this project is quite different. And I think the nature of the Indigenous communities with whom we’re engaging are quite different.”
Mr. Emsley didn’t tip his hand about what his group or others might do should approval be granted for Terminal 2. Civil disobedience is possible, he said, although he added, “I don’t know who might do it.” Might that include APE? “Well, we’ll see,” he said. What is likely is some sort of legal action, not just from environmentalists, but from First Nations, he said. “This thing will get delayed for years,” Mr. Emsley predicted.