Tuesday, June 02, 2009

 

MPs oppose sale of BC coal terminal

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Compare the proposed sale of Ridley Terminals against the 2003 sell-off of BC Rail.
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Battle brews as MPs oppose sale of BC coal terminal

PATRICK BRETHOUR
The Globe and Mail - May 21, 2009

VANCOUVER — Private companies are lining up to bid for the cash-strapped coal-shipping Crown corporation in Prince Rupert, potentially handing Ottawa as much as $131-million as it seeks to raise billions from the sale of government property this year.

But the $131-million offer for Ridley Terminals - one of four formal expressions of interest - is being stymied by government MPs worried about the effect of privatization on coal-mining firms in the B.C. Interior, says Daniel Veniez, the Conservative-appointed chairman of Ridley.

In an interview with The Globe and Mail, Mr. Veniez said the opposition has been spearheaded by Jay Hill, government House Leader and the member of Parliament for Prince George-Peace River, a riding that embraces a large swath of B.C.'s coal-producing region.

Members of the Conservative British Columbia caucus, including Mr. Hill, are also unhappy with Ridley's attempts to negotiate higher rates for the coal shipped from the Interior through its Prince Rupert facility, Mr. Veniez said. "We have not made their lives easy, we've run the place as a business."

But the conflict with Ottawa has taken its toll on Mr. Veniez and his board, who believe they have simply done the job they've been asked to do, and are now being caught in political crossfire.

"I can't keep my directors contained any more on this," the former forestry executive wrote in an e-mail to a senior adviser in the government earlier this month. "Our reputations have been dragged through the mud and we've been left hanging by the government."

In the interview, Mr. Veniez stressed that he does not believe Prime Minister Stephen Harper is aware of the simmering dispute.

For his part, Mr. Hill readily acknowledges his concerns about the future direction of Ridley, saying it would be "completely irresponsible" for him not to give voice to worries about the effect of privatization or higher fees on the coal industry in northeastern B.C. - and the hundreds of jobs that depend on those mining firms.

One of the larger firms, Peace River Coal, met with the B.C. caucus a month ago, an event that Mr. Hill said is not unusual. That is just part of his job as an elected representative, Mr. Hill said. "If someone is describing this as political interference, they don't understand the role of a member of Parliament."

The tug-of-war over Ridley is the latest chapter in the odd history of the terminal, which started life as a Trudeau-era Crown corporation in 1982, deliberately targeted at spurring the development of B.C.'s coal resources.

Ridley Terminals continually struggled, and had to turn to the government several times for loans. Finally, in 2005, Paul Martin's Liberal government decided to sell off the troubled asset to an Ontario-based coal-mining firm for a comparative pittance - just $3-million, far less than the $400-million that the federal government has sunk into Ridley over the past 27 years.

One of the first acts of the newly elected Conservative administration in 2006 was to cancel that deal.

A new board was put in place at Ridley, headed by Mr. Veniez, who went on to install new management and negotiate a long-term labour deal. Mr. Veniez said he was given the mandate to stabilize the business and allow the government the option of privatizing Ridley.

But the notion of selling off the terminal to a private company, which would charge higher market-based rates, is at odds with the vision (in line with the original Trudeau-era strategy) that sees Ridley as something more akin to a public service, providing reasonable shipping access to B.C. coal miners.

Mr. Hill, who supported the cancellation of the 2006 sale, said he still believes public ownership is appropriate for Ridley, perhaps through amalgamation with the Port of Prince Rupert, also owned by the federal government.

"I'm very supportive of it continuing as a Crown corporation," he said, noting it is an "anomaly" to have two Crown corporations so closely related operating separately.

The offers for Ridley come in the midst of an effort by Ottawa to sell $2-billion in government-owned property, including "enterprise" Crown corporations (a category that includes Ridley Terminals). Yet a government source said Ottawa is not "aggressively considering" the sale of Ridley.

Mr. Hill said he has not seen an offer - "certainly nothing in writing" - and that in any case he is not directly responsible for decisions on the strategic direction of Crown corporations.

The offers for Ridley are not final and the majority of the $131-million offer would be paid out over several years.

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A friend added this note:
The Harper Conservative government is not governing, they are in panic mode and don't know what the hell they are doing. It's bad (and dangerous) enough they've played around with a nuclear reactor, but now to consider selling to & involving a private company whose only concern is for the bottom line, is sheer madness of the highest order. Taxpayers will be on the hook for liabilities and toxic assets.
Hopefully the Senate (Liberal Senators) will put a stop to this.

Full story: AECL's Viable Assets to be sold. By Ish Theilheimer, Straight Goods.
Taxpayers will be on hook for liabilities and toxic assets.

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BC Rail was "privatized" during a period of Wild West madness, as well. Errors of judgment were made, or why else would the deal still be shielded from public access? Why are the terms still secret? Gordo's new government with its massive majority of 77 MLAs to 2 in Opposition pretended that they inherited a deficit in 2001 when they had inherited a surplus ... a surplus which they immediately gave away in tax cuts for big industry ... after which they claimed to be short of money ... and, as with Ridley Terminals, were forced to sell Crown assets to obtain fresh money. - BC Mary.

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Comments:
Let's just hope they don't sell Ridley. Especially to the Campbell Cartel because we know what will happen if they do.
 
Actually,good post. thx
 
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