In January 2019, the The Canadian Transportation Agency (CTA), an independent regulator, opened an investigation into ongoing rail service issues in the Port of Vancouver. The purpose of the investigation was to “make a determination on whether the railway companies have fulfilled their service obligations with respect to freight rail service in the Vancouver area.” (Letter Decision No.2 Let-R-29-2019). On April 15, the CTA issued its determination and finding that the Canadian National Railway breached its service obligations. Full conclusion from the CTA as follows:

“The Canadian Transportation Agency (CTA) issued today its determination on possible freight rail service issues in the Vancouver area following an investigation launched on its own motion, with the authorization of the Minister of Transport.

The CTA found that Canadian National Railway Company (CN) breached its level of service obligations by announcing its intention to impose embargoes on wood pulp shipments in September 2018, several months before rail congestion and other challenges emerged in the Vancouver area, and imposing those embargoes in December 2018, rather than making every reasonable effort to deal with those challenges before unilaterally restricting the transportation of the shippers’ traffic.

The CTA found that Canadian Pacific Railway Company (CP) and BNSF Railway Company (BNSF), the two other railway companies investigated, had not breached their service obligations.
The CTA ordered CN to develop and submit a plan to respond to future traffic surges in the Vancouver area and to avoid, or minimize, the use of embargoes. The determination also sets out criteria for the lawful use of embargoes, including that they be imposed only on an exceptional basis, be targeted to address specific challenges, and be lifted as soon as possible.

The CTA initiated this investigation on January 14, 2019, based on information received from shipper associations and other parties. This was the first own motion investigation undertaken by the CTA under a provision added to the Canada Transportation Act in May 2018.

The investigation process included the submission of written information by the railway companies and some shipper associations, and a public hearing in Vancouver at the end of January.”

Further information can be found from the CTA website or visit AGCanada.com for a thorough summary.

The Pilotage Act is the governing legislative framework for all pilotage services in Canada. Established in 1972, the Act divides the waterways of Canada into 4 distinct areas governed by their respective bodies: the Pacific Pilotage Authority, the Laurentian Pilotage Authority, the Great Lakes Pilotage Authority and the Atlantic Pilotage Authority. It is the 1^st authority in this list that overseas the movement of commercial vessels within the inland waters of the West Coast of Canada. The Pacific Pilotage Authority (PPA) contracts out their work to the British Columbia Coast Pilots who are responsible for manning each vessel within the designated pilotage area with a fully qualified pilot. This type of service contract is standard across all 4 pilotage authorities as regulated within the Pilotage Act: “(2) Where a majority of licensed pilots within the region, or any part thereof, set out in respect of an Authority in the schedule who form or are members or shareholders of a body corporate elect not to become employees of the Authority, the Authority may contract with that body corporate for the services of licensed pilots and the training of apprentice pilots in the region or part thereof where the contract is to be effective, and the Authority shall not employ pilots or apprentice pilots in the region or that part thereof where such a contract is in effect.”  These service contracts extend to the areas of the attached map along British Columbia which are known as mandatory pilot zones. There are currently 4 pilot boarding areas where a dispatched pilot will embark/disembark in order for the vessel to enter or depart Canada –

Brotchie Ledge 48° – 22′ – 30″ NORTH 123 – 23′- 30” WEST

Cape Beale 48° – 47′ – 12″ NORTH 125° – 12′- 48″ WEST

Triple Island 54° – 17′ – 36″ NORTH 130° – 52′- 40″ WEST

Pine Island 50° – 58′ – 00″ NORTH 127° – 46′- 00″ WEST

The Pilotage Act is no stranger to reviews and amendments, including a 2016 report that concluded the main deficiencies with the current system relate to “five key components of the legislation: its purpose and principles, governance model, labour structure, safety framework, and tariff-setting process.” In our opinion, more needs to be done to increase the transparency between the BCCP and PPA, as the BCCP is a service contractor to a Federally mandated authority.

On April 6, 2019 a second reading of Bill C-97 (Budget Implementation Act, 2019) was tabled in the Government of Canada Parliament. Although the amendments have yet to be confirmed and enacted, this Bill represents the largest proposed change to the Pilotage Act, 2001 since revisions made in 1998. Within the proposal contains several key amendments which have been recommended in order to keep with the purpose and principles of the Act –

“(a) that pilotage services be provided in a manner that promotes and contributes to the safety of navigation, including the safety of the public and marine personnel, and that protects human health, property and the environment;

(b) that pilotage services be provided in an efficient and cost-effective manner;

(c) that risk management tools be used effectively and that evolving technologies be taken into consideration; and

(d) that an Authority’s pilotage charges be set at levels that allow the Authority to be financially self-sufficient.”

Additionally, improvements regarding the “transparency of all contracts (clause 231) and the improvement of the tariff setting process (238)” are among the most important of proposals in the amendment. (COS Weekly Newsletter, 2019).

The Pacific Pilotage Authority announced late last week that inbound bulk carriers laden with cargo will now require an escort tug when the flood current exceeds 1.5 knots at the entry into Vancouver Harbour (1^st narrows). While total additional cost will depend on number of hours required for the assist tug and size requirements as deemed necessary by the dispatched pilot, estimated cost will be around $4,000 CDN. For the time being, this escort tug is only need for inbound vessels and during the above tidal restrictions – this situation can be avoided by altering the vessel’s arrival slightly to a time outside of the 1.5 knot flood window.

From the Interim Notice to Industry released 4 April, 2019 (attached picture) –

Details: There was an incident recently in Vancouver Harbour involving a laden bulk carrier that entered on a flood tide and appeared to lose directional stability. As a result, the Pacific Pilotage Authority and the BC Coast Pilots Ltd. have conducted a risk assessment on loaded bulk carriers entering the port of Vancouver on a strong flood tide. The results show that it is very difficult for such vessels making for a berth or anchorage from KM Vancouver Wharves to Centerm to slow up without losing direction stability.

Guideline: As an interim measure while the TSB complete the investigation as to the root cause, the PPA is recommending the following when the flood current exceeds 1.5 knots:

• An escort tug with a minimum Bp of 65 tonnes is to be ordered for any inbound loaded bulk carrier with a LOA between 200m and 250m and a draft in excess of 12.0m making for an anchorage between KM Van wharves and Centerm.
• The escort tug to be made fast centre lead aft 2 cables west of First Narrows Bridge weather permitting
• For vessels over 250m users should refer to the Ports First Narrows TCZ (TCZ-1) in the Port Information Guide at: https://www.portvancouver.com/marine-operations/port-information-guide/

Note: This notice will be amended and clarified once the TSB report has been published.

We hope that this restriction will be lifted or at least further minimized once the Transportation Safety Board issues their report.

The 0.5% sulphur cap currently scheduled for implementation in 2020 is fast approaching. The global reduction is targeted at “significantly reduc[ing] the amount of sulphur oxides emanating from ships and should have major health and environmental benefits for the world, particularly for populations living close to ports and coasts,” according to the International Maritime Organization (IMO – Sulphur 2020 – cutting sulphur oxide emissions). Regulations to reduce or limit the sulphur emissions from deep sea vessels has been in force since 2005 under the 1st MARPOL convention. Ship owners have multiple options available in order to comply with these new regulations including the following (DNVGL – Global Sulphur Cap 2020 – extended and updated)

1. “Switching from high-sulphur fuel oil (HSFO) to marine gas oil (MGO) or distillates”
2. “Using very-low-sulphur fuel oil or compliant fuel blends (0.50% sulphur)”
3. “Retrofitting vessels to use alternative fuels such as LNG or other sulphur-free fuels”
4. “Installing exhaust gas cleaning systems (scrubbers), which allows operation on regular HSFO”

The Vancouver division of Subsea Global Solutions stopped by our office in late March to discuss general industry information and offered a local solution to the 4th option listed above. As per the Subsea Global Solutions Chronicles – March 2019: “Subsea Global Solutions (SGS), working together with several scrubber manufacturers, has been at the forefront of scrubber system installation in cruise vessels since 2014. The underwater ship repair expertise of SGS makes installation of complete scrubber systems possible without taking the vessel out of the water, avoiding any interruption to the vessel’s scheduled itinerary … SGS involvement ranges from the installation of the sea chests, installing overboard discharge pipes, cutting hull openings for the sea chests, and installing gratings. While SGS mainly provides support from the water side, we have also been involved with welding projects related to scrubber system installation on the inside of vessels as well. Sea chest design varies from conventional box designs to innovative pipe designs with diameters in excess of 1000 mm. Since 2014, SGS has been involved with the successful installation of more than 20 scrubber systems on cruise vessels.”

For further details visit – www.subseasolutions.com/news.php