Federal funding of $150 million announced for Port of Montreal Contrecoeur project

By Maritime Magazine
2023-10-10

The Canadian government today announced funding of $150 million under the National Trade Corridors Fund for the Port of Montreal’s Contrecoeur terminal project for increasing container capacity by 1.15 million TEUs and whose cost has reportedly increased to about $1.4 billion from an initial estimate of $950 million. The federal contribution adds to the $300 million already pledged by the Canada Infrastructure Bank and $130 million from the Quebec government.

Simultaneously, the Port of Montreal announced a “hybrid approach” that cancels the previous procurement process which had shortlisted three groups. Marine works will be carried out by the MPA and land site works and future operations will be carried out by a private industry partner to be determined.

The most recent forecasts point to 2027 as a target date for the start of operations.

“The Port of Montreal is an economic driver for the province of Quebec and Montreal, and a key element of our national supply chain,” said Pablo Rodriguez, Minister of Transport. “By supporting the Port in its expansion project in Contrecœur, we continue our efforts to strengthen Canada’s supply chain. This is important so that we never again have to go through product shortages like we experienced during the pandemic, or the significant price increases that came along with them. “

In 2021, the Port of Montreal’s expansion of its activities at Contrecœur received a favourable Decision Statement from Canada’s Minister of the Environment and Climate Change, allowing the project to proceed.

“This financial backing from the federal government sends a strong message about our large Contrecœur expansion project and the future of the logistics ecosystem in the St. Lawrence corridor,” commented Geneviève Deschamps, Interim President and Chief Executive Officer of the MPA. “It lets us embark on the next steps with confidence, so that we can continue to play our vital role as a sustainable economic driver at the heart of the Quebec and Canadian economies,” said Geneviève Deschamps, Interim President and Chief Executive Officer of the MPA.

The construction for the new terminal will include:

a 675 metre-long dock, including the approach area for ships;
a rail network connecting to the existing Canadian National Railway (CN) tracks, including a railway transfer point and freight transfer hub;
road access to connect the terminal to the public network;
a container handling yard; and
operations and administrative buildings.

Once completed, the new terminal is expected to increase the annual value of imports and exports handled at the port, generating up to $140 million per year across the country. In addition, it would increase the total capacity of the Port of Montréal by 55 percent to meet future demand and help maintain fluidity in operations.

A hybrid approach

The financial support announced by federal Transport Minister Pablo Rodriguez will enable the MPA to implement a new delivery model for the major expansion project on Montreal’s South Shore. Under the MPA’s new approach, the MPA will be taking over some of the responsibilities for carrying out the project and cancels the current call for tenders to opt for a more agile approach. Work on the future terminal will be carried out in hybrid mode:

Marine works will be entirely carried out by the MPA. The MPA will act as prime contractor for this phase, which includes dock construction and dredging work. Project planning will use a Design-Build approach (“DB model”) with a specialized firm assisting the MPA for the next 9 to 12 months. At the end of this phase, the MPA will assign the project works according to its procurement processes, and will present an updated schedule for this component of the project works.
Land site works and operations will be carried out with a private partner. The MPA will issue a Request for Proposals in early 2024 to select a private partner to build the terminal (container yard, buildings, facilities and rail connection). This private partner will also operate and maintain the terminal under a DBFOM (Design-Build-Finance-Operate-Maintain). The water-based project works mentioned above are excluded from this component.

“As a result, the DBFOM procurement process launched in November 2021, which included both the terminal’s construction work (marine and land site) and its operation, has been cancelled to make way for this new method to successfully carry out the project that is better suited to today’s reality. Discussions with the bidders did not lead to a result deemed satisfactory by the MPA after factoring in market trends, including interest rates and inflation, between the time the Request for Qualifications began in 2021 to today,” the MPA stated.

Photo from left to right: Martin Damphousse, Mayor of Varennes and President of the UMQ; Angelo Iacono, Member of Parliament for Alfred-Pellan; Rachel Bendayan, Parliamentary Secretary to the Deputy Prime Minister and Minister of Finance and Member of Parliament for Outremont; the Honourable Pablo Rodriguez, Canada’s Transport Minister and Quebec Lieutenant; Maud Allaire, Mayor of Contrecoeur; Geneviève Deschamps, MPA Interim CEO; Paul Bird, Vice- President, Contrecoeur Project; John Parisella and Anik Trudel, MPA Board members.

Photos: MPA