The St. Lawrence Seaway Management Corporation (SLSMC) recently released the results of its operations for the year ended March 31, 2012.
Combined traffic in 2011 was up 1.0 million tonnes to 37.5 million tonnes. Grain shipments fell from 9.2 to 8.6 million tonnes. While Canadian grain shipments were strong, U.S. grain shipments were weak as a result of flooding in the U.S. Midwest. Iron ore shipments fell from 9.7 million tonnes to 8.8 million tonnes as a result of the closing of a Great Lakes steel mill, partially offset by an increase in exports of U.S. iron ore. At 3.7 million tonnes coal shipments remained unchanged for the prior year. “Other bulk” shipments jumped from 12.3 to 14.8 million tonnes on the back of strong growth in petroleum products, salt and coke. Growth in petroleum product shipments represented one-time shipments of refined products to replace output from an Ontario refinery, which had been shut down due to maintenance requirements.
The Corporation’s “New Business” activities resulted in 2.5 million tonnes of additional cargo, representing incremental revenues of $3.6 million.
The Corporation is governed by a Management, Operations and Maintenance Agreement signed with the federal government in 1998 for a twenty-year period, which was renewed after the initial ten-year period to 2008. Fiscal 2012 represented the fourth year of the current ten-year period. The financial success of the Corporation is measured by comparing the total cost of operating against the business plan established for the period.
For fiscal 2012, total revenues rose from $66 million to $68.1 million, whereas operating expenses rose from $67 million to $73.6 million. The Corporation spent $129 million on “manageable costs and asset renewal projects”, compared to a business plan target of $134.3 million. These funds were spent on operations ($73.6 million), maintenance ($53.7 million) and capital expenditures ($1.7 million). Operating expenses rose steeply primarily because of adjustments to the Corporation’s employee benefits and pension plans.
While the Corporation remained within the expense levels established by the business plan, revenues of $66.5 million fell far short of the objective of $95.3 million established in the business plan.
For fiscal 2013, the Management expects a 2.8 per cent increase in traffic, a 2 per cent increase in total revenues, and a 1.8 per cent increase in operating expenses.
In cooperation with the shipping industry, equipment suppliers and governments, SLSMC and Saint Lawrence Seaway Development Corporation finalized the development of a Draft Information System (DIS). Vessels equipped with a certified DIS are eligible for an extra three inches of draft beyond the published maximum, allowing them to carry as much as 400 tonnes of additional cargo on each voyage on SeawayMax vessels. It is expected that shipowners will begin to implement these safety-enhancing and money-saving systems during the current navigation season.
Another important innovation with the potential to raise productivity and lower Seaway operating costs is automated ship-mooring technology. SLSMC is presently conducting trials with prototype Hands Free Mooring systems, and initial results look promising.