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Issue #584 | Breakbulk Quarterly

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Breakbulk Quarterly

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2014 Media Kit
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Mackenzie Valley Highway overall benefit to region

By: | at 07:00 PM | Channel(s): Intermodal  

On the basis of a recent government report some political leaders in Canada’s far north have renewed calls to build a permanent road, dubbed the MacKenzie Valley Highway, to the country’s arctic coast for development of that region’s huge energy and mineral resources. The report said the time was right for Canada to revive a long-stalled plan for the all-weather road that would eventually link the Arctic port of Tuktoyaktuk, with the territory’s existing road system more than 800 kilometers (500 miles) to the south.

The overall plan ties the MacKenzie Valley Highway’s construction to the proposed development of natural gas in the MacKenzie Valley on the Beaufort Sea in Canada’s far north and a C$7 billion, 1,350 kilometer (850 mile) pipeline that would move the gas south to markets in Canada and further south through the United States.

The benefits of a permanent road to the North will be long-term,’ said Jan Berginger, president and CEO of Rohde & Liesenfeld Canada Inc. (R&L Canada) ‘And certainly logistics hubs for consolidation of cargo and movement to the north will be developed in Canada to support consolidated truck load movements moving up this highway.’ Rohde & Liesenfeld Canada is a member of the Global Project Logistics Network (GPLN), a non-exclusive professional projects logistics group for independent companies specializing in international projects shipping by air, sea and land as well as specialized lifts and handling of oversized, out-of-gauge and heavy lift cargo. GPLN members are especially interested in such a infrastructure development due to the project cargo potential of the area.

For shipping to this northern region in the past R&L Canada handled the import movements from suppliers all over the world for cross-docking through an Edmonton warehouse and then onforwarding in conventional containers to Hay River and Fort Smith. R&L Canada then shipped the cargo by barge up to the northern communities like Yellowknife, Inuvik, Tuktoyaktuk as well as other northern locations. This had to be done as a seasonal business though.

The MacKenzie Valley Highway doesn’t necessarily mean a boon economically for the region over an extended period of time though. Although Beringer believes that the long-term business will overall improve with the highway if it is built, he believes the biggest impact will be when the proposed MacKenzie Valley gas pipeline is actually being built. ‘There will be increased movements of cargo during the construction phase of the MacKenzie Valley pipeline and increased supply materials and consumables to support both the pipeline construction and increased drilling and exploration,’ says Beringer, ‘But the existence of the road itself will not provide increased opportunities to logistics players who are not ‘already established’ and have ‘supporting infrastructure’ for movement of cargos to remote sites in the north.’

The funds to pay for the highway were meant to come possibly from tolls on the road, but some people think that this might not be a feasible option. ‘The problems with trying to justify this highway economically is that the number of travelers taking this trip by car is minimal,’ said Blaine Karst, an oil & gas industry executive who is from Alberta, ‘Plus you are building it in a region which is not user friendly to roads. With all the perma frost and other weather conditions there would be a high maintenance cost. I think the real question is how many people would actually use such a road.’

According to the governments report, the MacKenzie Valley Highway should replace the existing ‘winter roads,’ which are ice-covered rivers and frozen ground that cargo laden trucks drive over during winter. This system has become threatened by global warming. ‘The existing limited transportation window makes development and exploration activities expensive and inefficient,’ the government’s report said. But Jan Beringer, whose company is a specialist in oversized and out-of-gauge shipments, doubts this road would be much good for the heavier cargoes. ‘Most pr