Winnipeg Free Press - PRINT EDITION

Churchill must diversify, but how?

Declines in ecotourism, uncertainty around port's future provide wake-up call

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CHURCHILL -- The annual migration to Churchill of hundreds of polar bears -- and thousands of polar-bear watchers -- is underway as you read this.

Seasonal hotels and restaurants are opening, rooms are being prepared, linen is being aired, shelves are being stocked with souvenirs and native art. Mechanics are tuning up tundra buggies, the improbable balloon-tired buses that carry tourists willing to pay up to $6,000 for up-close encounters with ursus maritimus on the Churchill lowlands, where about 1,000 of the white bears gather in anticipation of freeze-up and their winter seal hunt on the ice in Hudson Bay.

This is the big show -- six weeks from mid-October to late November, when adventure-seekers and seasonal workers from as far away as South Korea triple the town's population and the good times roll.

But not like they used to. Before the world-wide recession, Churchill's bears attracted as many as 10,000 a season. In recent years the numbers have fallen. This year, 7,500 to 8,000 are expected.

That's worrying.

Tourist numbers also were down during beluga season in early summer, when 7,000 of Hudson Bay's 55,000 white whales converge on the mouth of the Churchill River to calve.

That's worrying, too.

But most worrying is the uncertain future of the Port of Churchill, the community's raison d'être since 1929, when its opening realized a dream of Prairie farmers seeking a shorter, cheaper route to ship their wheat to Europe.

Until a year ago, the Canadian Wheat Board could be relied on to send predictable volumes of grain -- about 500,000 tonnes a season -- to the port for transshipment to its customers.

It was never enough, really -- the port can easily handle twice that volume. But it was enough to keep 90 residents employed on a seasonal basis, earning $30,000 or $40,000 and credit toward employment insurance benefits.

But when the Stephen Harper government made good on its promise to strip the CWB of its monopoly to market western wheat and barley, a frisson of fear rippled through Churchill.

Would the end of the monopoly mean the end of the line?

It hasn't happened -- the port is expected to reach its usual level of 500,000 tonnes this season, all of it dragged north on the Hudson Bay Railway.

But is the volume sustained because Ottawa is subsidizing shipments by private grain carriers who long ago had stopped looking north? What will happen in five years when the annual $5 million subsidy -- $9 per metric tonne -- is expected to end?

What then?

Churchill Mayor Mike Spence said changes to the wheat board "were a wake-up call -- holy smokes, what are we going to do now?"

In truth, the community and OmniTrax, owner of the Hudson Bay Railway and the Port of Churchill, had become somewhat complacent -- routine will do that.

To be sure, Churchill had not been sitting entirely on its hands -- it fostered the Churchill Northern Studies Centre, which is expected to attract 100 scientists and students to its new facilities east of the town.

And OmniTrax, with considerable federal and provincial help, is just completing $60 million worth of improvements to railbeds with the result that on-time delivery issues largely have been addressed.

But it wasn't until the Conservatives won a majority that Churchill and OmniTrax started thinking seriously about life after the CWB's monopoly.

Spence has since hosted a sustainability conference that identified improvements the town should make in scores of services and eco-tourism support. A development agreement has been reached with the Winnipeg Airports Authority to maximize use of Churchill's airport, and meetings with area leaders and mayors in the Nunavut region north of Churchill have been held with the goal of creating a "round-table" to lobby for investment.

OmniTrax has responded by opening a head office in Winnipeg to drive change and growth in its operations.

"We've historically been an operation that moves grain to Churchill," said Brad Chase, the new Winnipeg-based CEO of the company. "Now we're more of a business that provides services to clients."

OmniTrax currently is installing equipment to clean canola at the port, a first step in encouraging more canola traffic. It's also looking for ways to attract business from burgeoning potash development in Saskatchewan. And it's exploring the market for oilsands shipments through the port -- a real possibility, confirmed by a recent Maclean's magazine report.

Spence said it can't hurt that the prime minister has taken a keen interest in the North, travelling to Churchill three times, most recently this summer.

Spence said in conversation with Harper, the PM told him, "Churchill has to diversify."

"I said, 'Yeah, I know.' "

But how?

Spence believes the answer is obvious, and has been since the 1950s, when prime minister John Diefenbaker championed the North and its vast resources as the best hope for the future of Canada.

Manitoba should be encouraging development in Nunavut that would pay dividends back to Manitoba, Spence said.

The two most obvious ways of achieving that, he said, are by extending electrical services as far north as Rankin Inlet, and by linking the region to Churchill with a road.

Electricity would spur development, especially mining, which must spend hundreds of millions for fuel to drive generators for operations. A road would at last secure Churchill's place as a supply gateway.

"We gotta keep pushing this because it makes sense," he said. "If we strengthen the territory, it brings benefit to us."

Republished from the Winnipeg Free Press print edition October 6, 2012 A15

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