A new high-throughput grain terminal planned for Niobe is now in jeopardy of being derailed.
Construction of the $30-million to $40-million GrainsConnect Canada facility on a site one kilometre north of Innisfail was supposed to start this year, with the terminal opening in 2017.
But the project has been suspended and the company is considering other sites in Alberta, said Warren Stow, president of GrainsConnect, a joint venture launched by Japan’s Zen-Noh Grain Corp. and Australia’s GrainCorp last year.
“We are on hold at this point until we sort out some of the agreements around the terminal,” said Stow.
He would not elaborate on the reasons for the change in plans, but said it’s possible the Niobe grain terminal project won’t proceed.
“That’s fair. At this point we don’t have enough information to give it justice,” said Stow. “When we have all the information available we’re happy to share it. But at this point nothing has been determined, so to say it’s not going ahead isn’t correct and to say it is going ahead isn’t correct.”
News of the Niobe project became public in February, and was soon followed by Paterson Grain’s announcement of an even bigger 55,000-tonne grain terminal at Bowden, 15 kilometres to the south.
GrainsConnect’s proposed terminal on a 207-acre site just west of a Canada Malting Co. elevator, which the company owns, would have processed up to 35,000 tonnes of grain in 10 hours from 10 massive concrete towers. The project was designed to include a 2,700-metre loop rail track from the existing CP rail line.
Stow said “nobody is more disappointed than I am” that the Niobe terminal has been put on hold.
“We want to make sure we are making good solid economic decisions,” he said. “We are going to pick locations that make sense, so we are going to take our time (and) not rush into anything.”
The company is now focusing on its two Saskatchewan grain terminal projects, including a new one at Maymont (midway between Saskatoon and North Battleford) that is identical to the one planned for Niobe.
“We had the ability to switch on the Saskatchewan locations immediately so that is what we did and we will proceed in Alberta next year,” said Stow.
Last December, GrainsConnect Canada announced it was investing $120 million to construct four grain terminals in Alberta and Saskatchewan.
In the meantime, Winnipeg-based Paterson Grain, despite dealing with the regulatory wetlands issues with Alberta Environment at its site, is “100 per cent” going ahead with its planned Bowden terminal, said Shane Paterson, the company’s corporate development officer.
“From our perspective things are progressing as good as hoped and we are definitely still hoping to start potentially as soon as September but all of the cards have to fall into the right place for that to happen,” Paterson said last month.
The latest development from GrainsConnect will not alter his company’s plans, he said.
“I can’t speak to what Grains-Connect is doing or what might have motivated its change in plans,” said Paterson. “For the farmers there will be less capacity in the region, which is maybe a good thing or a bad thing depending on the year.”
Paterson Grain is also currently constructing a new grain terminal in Daysland, as well as one in North Dakota.