Presentation to the Transportation Border Working Group Montreal Plenary Meeting – October 25, 2007 Presentation by Marc Fortin

Director, Seaway and Domestic Shipping Policy

GREAT LAKES ST. LAWRENCE

SEAWAY STUDY

2

A Marine Highway

3

Marine Traffic and Trade

Waterway carries upwards of 260 million metric tons of cargo each year – this includes:

• 40% of Canada’s total domestic marine trade volume

• 50% of Canada’s total transborder marine trade volume with the U.S.

• 10% of all U.S. waterborne domestic traffic

• Furthermore, 25% of annual traffic through the Seaway locks moves to and from overseas ports, notably Europe, the Middle East and Africa

Prosperity of several sectors depends on reliable, low-cost waterborne transportation – including the steel, agriculture, construction, electrical generation, natural resources, safety salt and petroleum industries

4

Population Served, Economy Served, Transportation Network

The GLSLS system serves a region that:

• Borders 2 provinces and 8 states

• Is home to 110 million people or 30% of the Canada/U.S. population

• Accounts for more than 60% of Canada’s GDP

• Contributes approximately 30% to U.S. GDP

• Accounts for 55% of North America’s manufacturing

• Includes major industrial centres

• Offers strategic competitive advantages with fully integrated supply chains and multimodal transportation network

5

Forward Look – Key Considerations for the Waterway

Aging infrastructure

The locks have been in service for 50 to 75 years and the demands of maintenance are growing as are the costs

Economic vitality and efficiency

System is under-utilized and has the potential to almost double present cargo volumes within its existing locks and channels

Environmental stewardship

Taking stock of the environmental impact of commercial navigation on the system turns up a mix of positives and negatives

Policy rationale for the GLSLS Study …

6

The GLSLS Study

• Transport Canada

• U.S. Department of Transportation

• U.S. Army Corps of Engineers

• The St. Lawrence Seaway Management Corporation

• Saint Lawrence Seaway Development Corporation

• Environment Canada

• U.S. Fish and Wildlife Service

Bi-National Study Report Release in November 2007

7

Study Framework

E N G IN E E R IN GW O R K IN G G R O U P

E C O N O M IC SW O R K IN G G R O U P

E N V IR O N M E N TW O R K IN G G R O U P

M A N A G E M E N TT E A M

S T E E R IN GC O M M IT T E E

8

Study Objective and Scope of Work

To evaluate the infrastructure needs of the GLSLS system, including the engineering, economic and environmental implications of those needs as

they pertain to commercial navigation

Engineering

• Infrastructure site inspections

• Component condition and criticality

• Reliability and risk analysis

• Timing and costs for maintenance

Economics

• Cargo/industry analysis

• Traffic forecasts

• Transportation rate analysis

• Carrier and shipper surveys

• New cargoes and new vessel market assessment

Environment

• Identification of value ecosystem components (air, terrestrial, aquatic)

• Baseline conditions and anticipated future trends

• Navigation-related impacts and stressor analysis

9

Integrating Three Perspectives

1. What role should the GLSLS system play within the highly integrated North American economy?

2. What transportation solutions are available to guarantee a dynamic future for the waterway?

3. What measures need to be taken to ensure the continued reliability of the system’s infrastructure?

4. How should the GLSLS system sustain its operations in a way that responds to concerns about environmental integrity?

10

1. Role in North American Transportation

The GLSLS system has the potential to alleviate congestion on the road and rail transportation networks as well as at border crossings

• Projected growth in GDP of the bi-national GLSLS region from $6 trillion to $14 trillion

• Forecast of market for containerized traffic carried by ALL modes in the bi-national GLSLS region is doubling from 70M TEU to 140M TEU by 2050

• When integrated with rail and trucking, the region’s marine mode can greatly increase overall capacity of the transportation system

11

2. Solutions for a Dynamic Future

A stronger focus on shortsea shipping would allow the GLSLS system to be more closely integrated with other modes of freight movement, while providing shippers with a cost-effective and reliable means to transport goods

Shortsea Shipping Promoting modal integration• Transhipment/feeder services• Cross-border services• Niche services and trades

Key Considerations

• Impediments that discourage provision of shortsea need to be addressed

• Incentives need to identified and promoted to encourage the use of marine as a complement to land transport

• Opportunities to advance cross-lake freight services on a pilot-project basis

• Emerging opportunities for new multipurpose vessels that carry both bulk and container cargoes

12

3. Optimizing the Existing Infrastructure

The existing infrastructure of the GLSLS system must be maintained in good operating condition in order to ensure the continued safety, efficiency, reliability and competitiveness of the system

Key considerations

• Ongoing identification of high priority components as part of a long-term asset management strategy

• Modern technology to maintain reliability and preserve capability to respond to new cargoes and vessels

• Infrastructure considerations linked to shortsea shipping

• Holistic view of ports and their evolving modal links

2010

2020

2030

2040

2050

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

$80.0

Millions

St. Mary's River Region

MLO - USDOT Region

Welland Canal

Region

MLO - Maisonneuve

Region

Ongoing Maintenance and Capital Investment at the

Lock Systems

13

4. Environmental Sustainability

The long-term health and success of the GLSLS system will depend in part on its sustainability, including the further reduction of negative ecological impacts caused by commercial navigation

Priority management areas

• Aquatic invasive species

• Channel dredging

• Disposal of dredged material

• Erosion caused by ship wakes

• Ships’ air emissions

• Water level management

Sustainable development

• Navigation impacts are intertwined with a variety of non-navigation impacts that cumulatively affect environment

14

The GLSLS Study

First comprehensive assessment of physical state of the GLSLS system’s infrastructure on a bi-national basis

First examination of economy, engineering and environment within the scope of one initiative

Presents fundamental understanding of future needs, opportunities and challenges

Builds awareness and and understanding of the GLSLS system and marine transportation

Bi-national Study Report will be released in November 2007

Inform policy development and planning

Maintain collaborative efforts and monitor future progress and success