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British Columbia airport hopes fuel, logistics park attract cargo

By Adina Solomon on December 10, 2013

Prince George Airport in British Columbia, Canada, doesn’t keep track of its freight volumes. Its cargo operation remains small – “very small,” says John Gibson, president and CEO of the Prince George Airport Authority.

“We didn’t have a very developed air cargo program,” he says. “There just wasn’t the infrastructure of freight forwarders and warehouses and everything to be associated with that.”

So the airport is working to bring the infrastructure to Prince George.

In addition to opening the third largest commercial runway in Canada a few years ago, adjacent to the airport sits a global logistics park that has 3,000 acres to develop. (The land does not belong to the airport. The government and private investors funded it.)

The development of the land depended on a highway running through the 3,000 acres, which opened in mid-November.

Gibson believes that all these improvements bring Prince George Airport closer to its goal: capturing Asian airfreight traffic.

John Gibson, president and CEO of the Prince George Airport Authority

“Our program’s basically been to attract cargo carriers in here, particularly on the return flights to Asia where they’ve got cargo capacity,” Gibson says.

Prince George Airport’s present cargo operation is limited. Thanks to scheduled service from Air Canada Jazz and WestJet, there is a smattering of belly-hold cargo. Freight and parcel services provider Purolator runs its main shipping hub for northern British Columbia in Prince George.

The city in Western Canada enjoys some advantages, Gibson points out. Prince George’s north-south rail line goes to Vancouver and the U.S., while its east-west line connects the Port of Prince Rupert to Ontario and the Chicago-Memphis corridor. That port is North America’s closest one to key Asian markets. Combine that with its availability of U.S. preclearance – eliminating a stop at the border – and using that rail corridor saves up to three days compared to going through a U.S. port and rail system.

“It’s finding a niche in speed of service from, most predominantly, China into the central North America market,” Gibson says. “That’s an advantage for developing a logistics park that can bring product in from Asia, put it into the warehouse, pick and pack it and redistribute it from North America by road, rail or air.”

Prince George has captured the attention, and wallets, of Asian investors, Gibson says. Most are connected to logistics operators and manufacturing companies.

The resource sector of North British Columbia’s economy continues to grow, as does the fuel business in British Columbia and neighboring Alberta.

“The oil and gas business in both provinces, as well as the mining industry in British Columbia and the transportation of fuel products to refineries and ports, is driving our economy right now,” Gibson says. “There’s CA$70 billion of resource and related projects in B.C. over the next 10-15 years that are on the books.”

Prince George Airport capitalizes on this by targeting outsize cargo such as heavy equipment. With the mining of copper and gold, the airport also eyes high-value minerals.

“Now at the same time,” Gibson says, “we know that going back to Asia, there’s a real demand for high-quality food products, so some of the investors are coming from food processing companies and others are just looking at the export of Canadian food products back to Asia.”

Some investors have looked at processing plants for seafood, meat and other agriculture products for export to Asia. In addition, a small live animal market offers cattle and appaloosa horses, generating ad-hoc freighter movements.

In late November, Prince George Airport set up fuel tanks that are not owned by a refinery, allowing for any carrier or refiner to buy fuel brought in by rail. The tanks have cut the airport’s fuel prices by a third.

“We’ve taken quite a bit more aggressive stance on developing the cargo program than maybe we were even three or four years ago,” Gibson says.

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