Ottawa will forge ahead with the sale of a struggling B.C. coal terminal, despite a sharp drop in shipments this year after producers scaled back or cancelled export contracts.
Canada Development Investment Corp., a federal Crown corporation known as CDEV, began the process of selling Ridley Terminals Inc. in December, 2012. "The sale process has faced numerous internal delays, but we continue to work to prepare for the sale of Ridley Terminals," CDEV vice-president Zoltan Ambrus said in a statement Monday. He said whichever buyer or buyers are eventually chosen will have to ensure "open access" – meaning the terminal must make its facilities available to any coal producer .
"There have been no changes to the mandate given to CDEV by the government, which is to sell RTI through a competitive process in order to achieve best value from a purchaser who will operate Ridley Terminals on a long-term sustainable basis and with open access," Mr. Ambrus said.
He made the comments after The Globe and Mail reported that Ridley will put its expansion project on hold for up to five years. The terminal is targeting to be at 18 million tonnes of annual capacity by the end of 2014 but no longer striving for 25 million tonnes a year of capacity by the end of 2015. Ridley's multiyear expansion began in 2011, when it had capacity of 12 million tonnes a year, mostly for coal though also some petroleum coke.
Last month, shipments through the terminal plunged to 557,581 tonnes, down nearly 50 per cent from October, 2013.
Ridley is touted as a gateway to Asia, but managers of the terminal located on Ridley Island near the community of Prince Rupert will delay plans for further expansion until potentially beyond 2019. Doubling capacity isn't needed in the short term because low coal prices have hammered producers and forced them to curtail or suspend shipments that arrive at the Port of Prince Rupert in rail cars.
"Despite the softness of the coal market … CDEV and its advisers continue to receive regular inquiries from parties interested in purchasing Ridley Terminals," Mr. Ambrus said.
The Prince Rupert Port Authority, a federal agency, leases land to Ridley, a federal Crown corporation.