Prime Minister Mark Carney said the government plans to make announcements related to building new infrastructure for ports. Manitoba’s premier thinks the Port of Churchill, shown in 2018, could become a major export hub.JOHN WOODS/The Canadian Press
Manitoba Premier Wab Kinew says he is excited about the prospects for the Port of Churchill to become a major export hub for Western Canadian commodities, but some industry officials and experts are wary of its difficult logistics and short shipping season.
Prime Minister Mark Carney said last week his government plans to make investment announcements related to building new infrastructure for ports, including those at Churchill, Man.; the Port of Montreal in Contrecoeur, Que.; and on the East Coast, putting them in the realm of what his government deems nation-building projects.
“I think the real opportunity is this: Western Canada is the engine for so much of our country’s economy – energy products, critical minerals – and we have tidewater in the Prairies,” Mr. Kinew said in an interview. “So, as we’re looking to pivot away from Trump tariffs, let’s use our tidewater in the Prairies – the Port of Churchill and Hudson Bay – to get to the European Union, to get to other international markets, more quickly.”
More frequent trains, expanded storage touted at Port of Churchill in northern Manitoba
Opinion: A renewed Port of Churchill will be a game-changer for Canada
In a draft list of 32 major projects that could be candidates for fast-track approvals under Ottawa’s new Building Canada Act, obtained by The Globe and Mail, the established but underused port on Hudson Bay is mentioned for its potential to develop export facilities for grain, minerals, potash, liquefied natural gas and crude oil.
The document says the expansion would be a multimodal rail and port corridor that could potentially include transmission lines to Nunavut and funding for icebreakers.
The port has a long history of shipping grain, though that business withered when subsidies ended a decade ago. But activities are under way to revive facility, located about 1,000 kilometres north of Winnipeg by air. Arctic Gateway Group, which runs the port and the railway that serves it, has been exporting test shipments of zinc concentrate from a Manitoba mine run by Hudbay Minerals Inc.
The Premier said he did not want to get into the logistical pros and cons of shipping each of the commodities. Instead, he said, his government is taking the approach of consulting and meeting the needs of Indigenous nations, which will play key roles in designing projects for expanding the port and the railway that serves it.
“This is an opportunity to take it from the $30-million order of magnitude to the $30-billion order of magnitude, and if we’re going to take a leap we just want to make sure of all of the legwork of making sure our partners are onside, that Indigenous nations are adequately involved and stand to benefit,” he said.
“You look at the long-term trajectory for Canada’s economic growth, and you look at the path to getting to 5 per cent [of GDP] military spending for Canada, I don’t know why Churchill would not play a part in that. It seems like such a winner.”
Arctic Gateway had been planning for expansion even before U.S. President Donald Trump launched the trade war that has dominated Canadian economic policy and forced the country to rethink its global relationships.
The company has owned the port and the Hudson Bay Railway, which extends from The Pas, Man., since buying them in 2018 from the previous U.S. owner, which had let them fall into disrepair. Arctic Gateway, owned by 29 First Nations as well as local governments in Manitoba and Nunavut, has upgraded the rail and port facilities.
Its chief executive officer, Chris Avery, says beefing up the port and rail facilities is very much in the national interest.
“The Port of Churchill has the potential to diversify Canada’s trade, expand market access, help Canada become a global energy superpower, and deliver long-term economic value for the north and the entire country,” Mr. Avery said in a statement.
Mr. Kinew said the port could play a part in Canada’s long-term economic plans.JOHN WOODS/The Canadian Press
Churchill is also part of a discussion about a potential economic corridor across the Western provinces from Prince Rupert on the northern B.C. coast, with potential for energy products to flow along that expanse. Saskatchewan Premier Scott Moe and Alberta Premier Danielle Smith have said they would like to see it on the list of nationally-important infrastructure projects.
An oil pipeline is part of the idea, though Mr. Moe has said it’s much broader; he thinks such a corridor would provide economic opportunities to Western Canada and, by extension, the entire country by dramatically increasing the value of exports over the next 20 to 50 years.
However, some officials say Churchill can’t be all things to all industries. Canpotex Ltd., Canada’s main exporter of potash, says the railway, which has struggled with an unstable track bed in sections, would be unable to handle the length of trains it runs for the fertilizer ingredient or the trains’ weight – they are among North America’s heaviest. It also said the port, as it stands, doesn’t have the facilities to load vessels with the product.
“For potash, Canada’s largest and fastest-growing markets are in Asia and South America – to serve these markets, we have existing port options in North America with excess terminal capacity, and the Port of Vancouver is our most critical outlet, since it is the most cost-effective and efficient corridor for Canadian potash exports,” Canpotex spokesperson Natashia Stinka said in an e-mail.
Arctic Gateway is in discussions with players outside the Canpotex fold, however.
For grains, Churchill is not a good investment for the Canadian taxpayer for several reasons, said Wade Sobkowich, executive director of the Western Grain Elevators Association. Foremost: The port is not open long enough each year.
It typically closes from November until August because of the ice pack, and year-round consistency is key to grain buyers, he said. The facility cannot be profitable unless it is capable of exporting more than one million metric tonnes during its shipping window, he added. Because of limited track infrastructure and storage, it would take close to 100 days to bring in the required volume.
“While there may be other uses for the port, it does not represent a good investment for the Canadian taxpayer today and it is a distraction from other projects that would do much more to address supply chain issues,” Mr. Sobkowich said.
However, Mr. Kinew points out that icebreaker construction is part of the conversation, and that the warming climate is extending ice-free periods. In the next several decades, Churchill could be navigable year-round, he said.
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Mr. Carney has touted what he views as an enormous opportunity for exporting liquefied natural gas from Churchill, but Barry Prentice, director of the Transport Institute at the University of Manitoba, said there will be challenges to overcome to make that possible.
For example, part of any future pipeline transporting natural gas would need to be constructed above ground, given the permafrost in northern Manitoba. As well, a liquefaction facility’s annual capacity would be limited by the shortened shipping season.
“I wouldn’t call it just an easy slam dunk,” Prof. Prentice said.
Eugene Lei, chief financial officer with Hudbay Minerals, relishes the prospect of expanding the port, which would help his company diversify its customer base. Last year, it shipped 10,000 tonnes of zinc concentrate from the port to Europe. This year it plans to ship a similar volume.
“It helps diversify our options for smelting, for customers, and as they continue to develop that port with icebreakers, it will open the seasons in which we can use it,” said Mr. Lei.
The port could also spur Hudbay to develop new mines in Canada that otherwise might not have been economic, he said.
With reports from Brent Jang, Emma Graney, Niall McGee and Bill Curry