CN Rail in joint bid for stake in East Coast container terminal

HALIFAX — Canadian National Railway is aiming to recreate its west coast success by bidding to acquire a stake in the largest container terminal in Eastern Canada.

“As part of our action-oriented approach to grow trade volumes on our eastern network, CN is exploring the opportunity with a partner of getting involved in the acquisition of Halifax’s Halterm container terminal,” said spokesman Jonathan Abecassis.

The Montreal-based company declined to provide details of its bid for an interest in Halterm, a 30-hectare site at the Port of Halifax. Halifax is Canada’s fourthbusiest port in terms of container traffic, behind Vancouver, Montreal and Prince Rupert.

More than 100 longshoremen work at the terminal, which is at the entrance to Halifax harbour and next to sprawling Point Pleasant in the city’s south end.

Union spokesman Kevin Piper said CN appears to be interested in transforming Halifax into a gateway port that can handle larger ships and trains that are more than three kilometres long.

“That’s what these big ships need,” said Piper, president of Local 269 of the International Longshoremen’s Association.

“They need to have the rail capacity when they dump off. You don’t want to stockpile the containers. You want to load them directly to the rail. That’s what they do in Prince Rupert.”

Piper said most of the cargo that arrives in Halifax is shipped by rail to Montreal, Toronto and through a tunnel at Sarnia, Ont., to the U.S. Midwest.

CN’s proposal could help the Port of Halifax almost double its container traffic, which currently stands at 500,000 20-foot equivalent units per year, said Piper. Each unit is equal to a standard 20-foot shipping container.

“If you’re going to double the capacity, you’re going to double the workforce,” he said, adding that the port supports about 12,000 direct and indirect jobs. “That’s long-term growth and long-term, sustainable, well-paying jobs.”

The port was badly hurt by the global economic meltdown in 2008, but its growth since then has eclipsed every other port in Atlantic Canada, helped lately by the weak Canadian dollar.

The Halterm Container Terminal was purchased by New Yorkbased Macquarie Infrastructure Partners for $172.7 million in January 2007.

Industry analyst Walter Spracklin of RBC Capital Markets said the purchase of a minority stake, although not large for CN, would be strategically positive for Canada’s largest railway.

“With a ‘seat at the table’ along with an experienced partner, we believe that CN ensures that capital and strategic planning at Halterm is conducted with long-term growth in mind,” he wrote in a report.