| |
Posted Sep 22, 2026, 12:31 AM
|
 |
Moderator
|
|
Join Date: Aug 2002
Location: Winnipeg, Manitoba
Posts: 8,483
|
|
Quote:
There might be no economic case for expanding the Port of Churchill, but that may not be the point
Canada might need shipping route as sovereignty insurance policy, even if it pays a premium to do so
Bartley Kives · CBC News · Posted: Sep 19, 2026
The Port of Churchill, in northern Manitoba, must be modernized before it can ship higher volumes of commodities. (CBC)
Piece by piece, like patches of ice receding from a frigid waterway, Manitoba's plan to expand the Port of Churchill is getting clearer.
Late last week, port owner Arctic Gateway Group attached a price range to the task of upgrading the site and the railway that connects it to the rest of Canada. CEO Chris Avery said it would cost $2 billion to $3 billion to expand the port to allow it to ship higher volumes of commodities and rebuild the Hudson Bay Railway so it can carry heavier loads.
In the context of provincial megaprojects, $3 billion is nowhere near unprecedented. There are two other projects in the works in Manitoba right now that are in the same price range.
The upgrades underway to the largest of Winnipeg's three sewage-treatment plants are expected to cost $3.2 billion once they're finished. The City of Winnipeg has assembled most of the money it needs to complete the job, which is entering its final phase.
The proposed expansion of Manitoba Hydro's gas-burning generating station in Brandon is also expected to cost $3 billion. Pending regulatory approval, the Crown corporation is ready to proceed with buying three new natural gas turbines.
The Port of Churchill expansion, meanwhile, exists in some sort of development limbo. The essential $3-billion work was not the subject of any pitch at Prime Minister Mark Carney's investment summit in Toronto this week.
Rather, the upgrades to the port and railway exist as a precursor to a larger project touted by Premier Wab Kinew — a $79-billion port expansion that includes a liquefied natural gas terminal floating off the shore of Hudson Bay.
The question before Manitobans right now is, why is the province not simply proceeding with a $3-billion port expansion and railway upgrade, if indeed this infrastructure is a prerequisite for other projects that are inevitable?
The answer is that the provincial government still has a choice as to whether it wishes to proceed.
The City of Winnipeg didn't have a choice when it pulled the trigger on upgrades to its North End Water Pollution Control Centre. Without those upgrades, Winnipeg would violate its environmental licence, run out of sewage-treatment capacity and end up unable to approve new residential and industrial development.
Manitoba Hydro, meanwhile, contends it is also in a difficult position. Without three more gas turbines in place in Brandon by 2030, Hydro argues, Manitobans could suffer from mid-winter power shortages.
There is less at stake if Manitoba dawdles on Churchill, as failing to upgrade the port and railway would affect far fewer residents. The town and dozens of other northern Manitoba communities stand to benefit the most from this particular megaproject.
As well, the economic benefits of the port expansion have not been demonstrated. The federal government has thus far refused to publish a Port of Churchill market sounding it commissioned. This raises suspicion international markets are not in love with the idea.
This could be why Kinew appears to be more interested in pursuing a liquefied natural gas moonshot. This week, the premier said this much larger project provides potential backers with a greater potential rate of return.
All of this ignores the primary purpose Canada ought to be interested in expanding the port at this moment in history, when our American friends have proven to be less than friendly.
As some of the world's leading experts in supply chains have stated over the past year, the Port of Churchill is of vital importance to Canada as an insurance policy — that is, an alternative means of getting goods out of the country — as opposed to being a money-maker.
Avery made this point last week, effectively arguing the port must be expanded if Canada ever hopes to divert more exports away from the United States.
"If we want to grow our non-U.S. trade by 10 percentage points, that's the equivalent volume of four times the size of the Port of Vancouver. So that gives you a context of what we're looking at,'" he said in an interview.
To be clear, Avery has never said an expanded Port of Churchill won't make money. But there is an argument to be made that its value as an insurance policy — effectively, the Canadian sovereignty argument — ought to make its potential as an economy-transforming revenue source a secondary concern.
University of British Columbia transportation and logistics professor Trevor Heaver said in 2025 that Canada should expand the Port of Churchill even without a purely economic case to do so.
"You've got to view these things from a national perspective, and that is present in this route," said Heaver, adding that insurance, by definition, comes at a higher cost.
Higher costs are certain for a route that involves an isolated port operated in frigid conditions on water that requires ice-hardened vessels to navigate for at least seven months out of the year.
"The economics may play out that it doesn't pay financially, commercially. So then, you're left with the issue of how much are you prepared to pay for the resilience, and how much are you prepared to pay for the sovereignty which comes from it?" Heaver said.
“How much are you prepared to pay for the revitalization of northern Manitoba?”
Heaver is not alone. Vidya Mani, a University of Virginia professor who studies global supply chains, said the Port of Churchill offers Canada's international trade partners the clear benefit of a shipping route that's free of geopolitical conflict.
She said the question is not whether Hudson Bay shipping offers Canada more flexibility.
"It is more a question of, can this flexibility be paid for?" Mani asked. "It will cost, but can you pay for it?"
Right now, no one's lining up to pay that $3-billion bill. The province doesn't have the ability to do so on its own.
While Manitoba Hydro and the City of Winnipeg can rely on utility bills to finance their own $3-billion projects, the province has no self-sustaining revenue source of its own to tap for a Churchill megaproject.
It's also burdened with nearly $40 billion of its own debt.
Documents obtained by CBC News show the Manitoba government sought U.S. advice last year to find private partners to build an artificial intelligence data centre near Winnipeg, as well as a new Nelson River hydro station, without affecting the province's own balance sheet.
While those talks didn't appear to go anywhere, the mere fact Manitoba was looking for private partners to pay for megaprojects is revealing.
Arctic Gateway can't foot the Churchill tab, either. It's owned by First Nations and other northern communities.
This leaves the federal government as the only saviour if Kinew's trip to Toronto this week did not result in big money coming to the Port of Churchill's rescue.
|
CBC News
|
|
|
Prev
Linear Mode
