The federal government opened the latch on the Asia-Pacific Gateway, so to speak, by announcing $4.65 million to modernize the Nanaimo Assembly Wharf for short sea container shipping.
The announcement was made Wednesday morning by Peter Van Loan, leader of government in the House of Commons, on behalf of Ed Fast, minister of international trade and for the Asia-Pacific Gateway, with James Lunney, Nanaimo MP, and Robert Bennie, Nanaimo Port Authority chairman.
The assembly wharf modernization project is part of Canada's Asia-Pacific Gateway and Corridor Initiative, designed to bolster trade and shipping with Asian markets.
The assembly wharf, which has been mostly dormant for about 10 years, will be renovated to handle short sea container shipping between Nanaimo and the Lower Mainland.
Van Loan sees opportunities for container shipping of lumber from Nanaimo.
"Containerization has made things more efficient and that will put this area back in play," Van Loan said. "We've spent a lot of effort trying to open up Asian markets with a lot of success in Japan, China and elsewhere to the Canadian lumber industry. Exports of lumber to the Far East have been going up at a very steep rate. It's been very important to the industry and this is an opportunity for this area to benefit from that activity even more so."
The $4.65 million will be matched by an equal investment from the Nanaimo Port Authority – from revenue it raises from fees for moorage and other services – making for a total investment of $9.3 million.
Bernie Dumas, Nanaimo Port Authority president and CEO, said the port estimates it will earn that investment back over the next 10 years.
The renovations could also get Nanaimo into the international container shipping business during times when the Port of Vancouver is filled to capacity and needs additional storage and shipment transfer facilities.
Nanaimo is one of several ports in the Asia-Pacific Gateway Initiative receiving money to improve facilities. Van Loan and Lunney were on their way to Port Alberni to make a similar announcement there Wednesday afternoon.
"The ability to move containers gives the ability to get into smaller lots," Dumas said. "It opens up new markets for the forest products industry here. The movement of cargo on Vancouver Island hasn't really changed since the '50s or '60s, so this project will enable direct movements of containers from Nanaimo, right to an international container terminal where they go onto a mothership right away and then off to Asia."
Dumas said the operation will be more seamless, involve fewer trucks and ultimately be greener and more energy efficient.
A sizeable portion of the renovation will go into purchasing a used container crane, which the Port Authority hopes to buy for about $2.5 million. Major reconstruction will be carried out to upgrade and strengthen the assembly wharf. A portion of it is built on wood pilings, some of which were driven in the 1950s.
The dock face will have to be upgraded, Dumas said, along with the bollards used to tie ships to the wharf and other components.
Construction could start in late September or early October and be completed by September 2014.
Dumas did not have hard figures projecting the number of direct job opportunities the wharf upgrades will generate.
"You're looking at (International Longshoremen and Warehousemen's Union) labour that wasn't loading containers here before, some trucking movements and some people that are going to load and stuff containers," Dumas said.
A loading crew for a barge totals about 12 people and Dumas estimated 200 to 300 12-metre containers would move through the wharf per week initially with an eye to increasing volume.
"You increase the volume and you increase the value," Dumas said.
Day-to-day Port of Nanaimo shipping operations will be handled by DP World Vancouver, a division of DP World, which operates 65 marine terminals worldwide and maintains its corporate head office in Dubai.
Most of the existing buildings on the 14-hectare site will be put to use for container-stuffing operations and other purposes.
Ultimately Dumas sees Nanaimo as being the possible gateway for shipping to the central Island and even Victoria.
"One of the things with containers is that you only need to move about 20 tonnes – you only need to fill up that box and get it to Asia, so you're going to see a lot of companies in Nanaimo and Duncan and maybe up in Campbell River that can actually start moving cargo to Asia that they couldn't do before," Dumas said.