Canadian government puts Ridley Terminals up for sale

AS THE export market on Canada’s western shore continues to grow, its government has made the surprising announcement Friday that it plans to sell the Ridley Terminals bulk-handling facility in British Columbia.
Canadian government puts Ridley Terminals up for sale Canadian government puts Ridley Terminals up for sale Canadian government puts Ridley Terminals up for sale Canadian government puts Ridley Terminals up for sale Canadian government puts Ridley Terminals up for sale

Courtesy Ridley Terminals.

Donna Schmidt

Finance Minister Ted Menzies announced the listing of the property, located on leased land from the Prince Rupert Port Authority at the port of Prince Rupert.

“The government of Canada regularly reviews its corporate assets to ensure the rationale for continued public ownership is still relevant and tax dollars are being spent wisely,” he said.

“Ridley Terminals once operated at a loss requiring millions in government support, but now is an asset of considerable value. Private ownership could allow the terminal to maximize its contribution to economic growth, jobs and new investments.”

Transport Minister Steven Fletcher said taking Ridley out of public ownership would align it with other major privately owned and operated facilities.

“Our government will seek the best value from a buyer that will operate Ridley Terminals with open access on a long-term, sustainable basis,” he said.

While financial details of the planned sale were not disclosed, the agency said the Canada Development Investment Corporation would serve as the government’s agent.

The sales process is expected to commence in the coming weeks with a market sounding.

The 55-acre Ridley Terminals facility was established in 1981 as a joint venture between the federal government and private sector operator Fednav. Ten years later, RTI became a wholly owned subsidiary of the Canada Ports Corporation.

The facility became a parent crown corporation in 200 when the Canada Ports Corporation was dissolved.

Last year, RTI reported a net operating profit of $34 million.

One party in full support of the government’s decision Friday was the Ridley Terminals Users Group, a coalition of large western Canada commodity producers and shippers who are current or future customers of Ridley. They include Arch Coal, Grande Cache Coal, Teck, Walter Energy and Xstrata.

“Ridley Terminals is a critical component of the western Canadian export logistics chain and a key enabler of delivering Canadian resource products to international markets,” the group said.

“As such, the Ridley Terminals Users Group welcomes the government of Canada's announcement that it intends to divest the terminal to a buyer that will operate it with open access on a long-term sustainable basis.”

RTUG chair Doug Smith said its members applauded the move, which acknowledged its position as a key driver of mine development in northern communities.

“[A] sale to a single operator driven only by price-setting objectives will undermine this potential,” Smith said.

“A fully-enabled Ridley Terminals will ensure the long-term viability of the asset, for the benefit of the western Canadian coal market and, related, local communities and economies throughout British Columbia and Alberta.”

RTI is working to increase its capacity from 12 million tons per annum to 25Mtpa by 2014.

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