The federal government announced today in St. John's that Marine Atlantic has reached an agreement with Stena Group of Companies to charter two new vessels to help meet increasing traffic demand between North Sydney and Newfoundland and Labrador.
The vessels are hoped to improve Marine Atlantic's ability to provide on-time, reliable service - something that has gotten a lot of criticism in recent weeks.
The announcement was made by Rob Merrifield, Minister of State (Transport),; Rob Crosbie, chair of Marine Atlantic Inc.'s (MAI) board of directors; and Wayne Follett, president and chief executive officer of MAI.
"Our government is supporting Canada's economy by investing in new ships to improve Marine Atlantic's service and reliability," Merrifield said. "This investment, from Budget 2010, is another signal of our government's commitment to Atlantic Canada. I look forward to seeing an improved customer experience as these ships come into service."
Budget 2010 provides $175 million to Marine Atlantic Inc. over the next two years to help renew its fleet and shore facilities, and improve the quality and reliability of its services. The funding will allow MAI to charter two vessels from Stena to replace the aging MV Caribou, and MV Joseph and Clara Smallwood. The new vessels, built in 2006 and 2007, will bring about significant cost savings and operational efficiencies by lowering fuel costs and consumption. The new charter agreement is conditional upon MAI obtaining all necessary governmental and other approvals as may be required.
"Chartering two modern vessels will significantly aid Marine Atlantic in improving its capacity and reliability," Follett said "This can be attributed, in part, to the efficient design and the newness of the vessels. Once they join Marine Atlantic's fleet, the average vessel age will be reduced from 21 years to eight years."
Marine Atlantic Inc., a federal Crown corporation, provides a vital link between Newfoundland and Labrador, and Nova Scotia. As an extension of the Trans-Canada Highway, Marine Atlantic's ferry services support tourism and the import and export of goods. In 2009, an estimated 27 per cent of all passengers, 50 per cent of all freight, and 90 per cent of all perishable goods between the Island of Newfoundland and the Canadian mainland were carried by Marine Atlantic.
The St. John's Board of Trade chairman Derek Sullivan said recognition of the Marine Atlantic ferry service as a vital trade link is welcome news.
"We welcome fleet renewal on Marine Atlantic because of the key role it plays in maintaining our $10 billion trade corridor between the mainland and our province," said Sullivan. "This announcement will help businesses here in terms of planning and cost controls, but will also provide mainland companies with better access to our strong economy, which is good for all of Canada."
The board has been active in lobbying for enhancements to the Marine Atlantic service, expressing on many occasions directly to federal officials that the service supports all of Canada economically. In 2009, the board brought forward a resolution to enhance the service to the Canadian Chamber of Commerce, a group which represents 175,000 businesses across Canada, which was unanimously accepted.