By Phil Le Good
If you think the recent cancellation of the Fraser Surrey Docks coal transfer station means less U.S. dirty thermal coal with a low British thermal unit value being shipped out of Metro Vancouver ports, you better think again.
What this likely means is that more U.S. thermal coal will be shipped out of Westshore Terminals at Roberts Bank.
Below, I'll explain why.
Neptune Terminals in North Vancouver recently expanded its facilities and its major shareholder, Vancouver-based Teck, is the largest metallurgical coal producer in Canada.
Teck relies on Neptune, as well as Westshore, to ship its metallurgical coal out of the country.
The mining giant owns 46 percent of Neptune, which is expanding its North Van facility to handle more of Teck's metallurgical coal.
Meanwhile, Teck has contract with Westshore at Roberts Bank for receiving its metallurgical coal until 2021. But for the past few years, Teck has been grumbling about how its metallurgical coal (used in steel production) is handled as Westshore.
If Teck doesn't renew its contract in 2021, that will leave Westshore with more capacity for U.S. thermal coal.
This, in turn, means that the Fraser Surrey Docks coal transfer station is not needed.
Perhaps this is what precipitated the Vancouver Fraser Port Authority to cancel the permit.
But wait, here's the other part of the story.
The Vancouver Fraser Port Authority owns the land upon which Westshore operates.
If Teck goes ahead with reducing or eliminating its shipments to Westshore and moves all of its metallurgical coal through Neptune, this would mean that Westshore would have the capacity to double its current shipments of dirty U.S. thermal coal out of its facility at Roberts Bank.
It's a win-win for the Vancouver Fraser Port Authority and Westshore.
You can imagine how Fraser Surrey Docks CEO Jeff Scott is feeling.
With friends like the Vancouver Fraser Port Authority, who needs enemies?