For YXS, The Sky Is the Limit

Tuesday, October 09, 2007 04:17 AM

Heavy Equipment moves in as the removal of soil from the south end of the existing runway begins (photos opinion250staff)

The construction of the extension of the runway at Prince George Airport is underway.

The full project will see the main runway extend to 11,400ft complete with center line lighting, dual ILS navigational systems and a dedicated deicing refueling pad for wide body aircraft and will allow the PGAA to market the airport as a transpacific techstop alternative to International air carriers. This will also enable carriers to consider Prince George for international passenger services.

“We have had enough interest and enough support to say that cargo companies are saying once it’s open (the runway) ‘we will be there’, We’re comfortable that we will have activity, shortly after it (the runway) opens” says Airport General Manager Stieg Hoeg. The runway will be open in fall of 2008.

The business case for the development of the Prince George Airport as a cargo stop is plain and simple, shorter flight to Prince George, cuts an hour off the flight, and that translates to a saving of as much as 50 thousand dollars for the air carrier.

At right, Todd Doherty, Manager of Planning and Programs for the Prince George Airport, along with Airport General Manager Stieg Hoeg, examine construction plans ( photo opinion250 staff)

Hoeg says he doesn’t want to focus on just tech stops, where a plane lands for re-fuelling “I think there is so much more opportunity on the trans shipments and associated movement of goods through this transportation corridor as a whole.” This offers an “integrated” transportation hub, in that rail, air and truck traffic are centralized. “That’s where I think we have a real opportunity for jobs.” That means the cargo portion of the expansion plan will move forward faster than first thought. The Prince Rupert Port is a key to that opportunity. Hoeg says its estimated every one thousand containers that arrive in Prince Rupert will generate one full 747 of air cargo. Prince Rupert is planning to handle 500 thousand containers per year, and that would translate into 500 cargo flights for Prince George. It is a project that will make money at just taking 3- 4 flights a day.

Hoeg says there is also a huge market for “back haul” flights “Imagine if you are a rancher, and want to send fresh beef to Asia, or fiddleheads, or mushrooms.” The carriers will offer much cheaper rates for a return flight to Asia as the flight has to return anyway for the next shipment coming to North America.

Hoeg is optimistic, and although the Anchorage (the current stop) media are now taking notes on the Prince George plans, Anchorage is neither threatened nor concerned. “We are here to be a compliment to that service, we are growing, but I would rather handle two aircraft a day and do it well than to handle five poorly.” He says the biggest opportunity for Prince George is connecting to the transportation corridor, and that is something Anchorage cannot do.

The total price tag for the project is $36 million dollars, and the first phase which is now underway, will focus on the south end of runway 15/33 working northwards and is expected to run into early spring. The cost of this first phase is $7 million dollars. IDL / Sharp Joint Venture have been awarded the first phase contract which entails drainage and site preparation for the next phase of the 2 year project.

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Posted on Tuesday, October 09, 2007 04:17 AM in News by 250 News

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Comments

Posted by: Palopu on October 9 2007 9:54 AM

Someone will have to explain to me how this all works. Hoeg states that for every one thousand containers that land in Prince Rupert will generate one full 747 of air cargo. Why would you send Air Cargo Freight by Container to Prince Rupert and then load it out on Air Cargo at Prince George.??? Air Cargo is Air Cargo you load it at the origin and fly it to destination. You dont ship it by rail and ship (which is one of the slowest forms of transportation) to a halfway point and then load it out Air Cargo. Im at a complete loss on this scenario.

I dont know how connecting to the transportation corridor midway will accomplish anything. You could take all the fiddleheads and mushrooms in the whole central interior and load them out in one or two planes and that would be that for the year. In addition I would assume fresh beef to Asia will be flown from the packing houses in Alberta much like it is being done now.

Anyway Im open to being convinced how this will all work. It will be interesting to say the least.

Posted by: owl on October 9 2007 10:43 AM

from the linked site below ... a 1998 report about YVR air cargo growth ....

"To meet their objective of becoming �the premier intermodal air cargo gateway between Asia and North America, airport management at YVR aims to double air cargo tonnage to 450,000 tonnes by 2010, an annual growth rate of 5.6 per cent. By that year they also hope to �provide a full intermodal gateway, linked to the North American Highway network, served by major trucking carriers, and linked to VANCOUVER�S PORTS FOR SEA-AIR INTERMODAL SERVICES.��

http://www.bcstats.gov.bc.ca/pubs/exp/exp9711.pdf

So, obviously neither the YVR nor the YXS staff have been listening to the person who really knows this business inside and out, right Palopu.

I suggest maybe you pick up the phone and call Todd or Stieg and ask one or both of them. I suspect they will tell you how that works. Nothing like going to the horse's mouth.

Posted by: owl on October 9 2007 10:59 AM

Look at the example used in the discussion on legal matters surrounding liability of one carrier over another when intermodal transport is used. The example is Zurich to Dubai by air and Dubai to Taiwan by sea ��.

Why would they use an apparently unrealistic scenario? I mean, if they wish the ship something from Zurich to Taiwan, and the last leg is Dubai to Taiwan, one would think that they would ship it by rail to a port in Italy or France, for instance, and then on to Taiwan.

I suspect that the answer to the question is the lower cost opportunities which backhaul provides and a combination which provides the best option when comparing cost with time.

What those factors might be for Prince George, I sure do not know, but I bet you Stieg and Todd have a pretty good handle on that by now, as does YVR which is a much bigger player for many other reasons.

http://www.forwarderlaw.com/library/view.php?article_id=462

Posted by: Palopu on October 9 2007 1:46 PM

Owl. I have asked those who are supposed to know questions in the past and have to admit that their answers are somewhat vague.

As an example when asked how they can project an increase in the passengers through the Pr George Airport from 400,000 to 800,000 in a 10 year period, when all other indications are that this area is declining in population the answer was that their information was based on similiar sized Citys in other areas of Canada and the growth that these Citys had enjoyed over a extended period of time, plus some other factors. Then of course they got some of their information on the increases from the Prince George Chamber of Commerce and IPG.

When asked if the 1% deviation that exists between Prince George and Anchorage was in favour of Prince George or Anchorage the answer was that depending on the Winds etc; it could be an advantage either way.

So you get my drift?????

I beleive that we now may be getting into a bit of a confusion between Containers that travel by ship, and Containers (much smaller) that travel by Air Cargo. Smaller Air Cargo Containers could be loaded in Prince George and sent to South East Asia (Im not sure what you would load in them) however this would not have anything to do with Containers coming into Prince Rupert with goods for the Midwest USA and Eastern Canada. These Containers will move to destination by Rail. This is clearly outlined in the correspondence put out by CN Rail, Port of Prince Rupert, Maher Terminals, etc;

Containers loaded and shpped ex VAncouver to other parts of the World is old hat and has been going on for years. Your article itself is **old hat** as it is dated 1997.

In any event to have an Air Cargo Operation in Prince George you will have to come up with some Air Cargo, and it will have to be a lot more than Fiddleheads, Mushrooms, and Fresh Meat. None of which are produced in this area in any volume.

Posted by: diplomat on October 9 2007 2:19 PM

Palopu: "I have asked those who are supposed to know questions in the past and have to admit that their answers are somewhat vague."

Perhaps they are keeping their cards close to their chest? I think there were extensive viability studies done and checked by the experts who had to make sure that there is indeed a market before funds were approved and committed.

"Fiddleheads, Mushrooms, and Fresh Meat." Three excellent ideas for new economic opportunities for this area! Especially the mushrooms and the meat, like in mushroom farms, feed lots, slaughter houses and meat packing!

The Chinese can finally afford to eat burgers and steaks now, with mushrooms! And China's population is still growing!

Posted by: Palopu on October 9 2007 3:19 PM

Diplomat.

We are talking about delicacy's here.

The mushrooms that demand the big price in Asia are grown wild in the forests of BC and are in short supply. Anyone can grow regular mushrooms in a pile of manure, including the Chinese. The same thing applies to the fiddleheads. They are a delicacy and have a very limited growing season and only grow in certain areas.

The slaughter houses are already built and working in Alberta and have been for a long time. Thats where all the beef is, and of course they would just fly it to China if there is a market for it.

Planes do and can go to China from other points in Canada besides Prince George.

Posted by: Palopu on October 9 2007 8:41 PM

Just as an aside to the above, the Montreal Airport Authority is in the process of raising its Airport Improvement Fee from $15.00 to $20.00. Toronto, Winnipeg, and Calgary are planning to do the same.

CEO of Montreal Aiport Authority James Cherry says that the cost of doing business in Canada as opposed to the USA is different. We have been treated as a cash cow by the governments for years. He was referring specifically to the fact that the Authority pays the Federal Government $60 Million per year in rents and taxes. The other major authoritys do the same.

We can rest assured that the Pr Geo Airport Authority will increase Airport Improvement Fees in the not to distant future.

The statement by Montreal Airport Authority CEO James Cherry, substantiates what I have been saying from the get-go that these Airport Authoritys are a way for the Federal Government to kite money throught the Authority into Government coffers, and download the cost of running the Airports to the Authoritys. One third of the overall cost is downloaded onto people who fly out of these Airports.

A new Airport an hours drive from Montreal in Plattsburgh N.Y. has a terminal built by the Government and pays no property taxes, federal rents or interest on debt. Meanwhile Montreal pays $60 million in rents and taxes, including 34 Million in municipal taxes and $70 million in interest to service debt.

The cost to fly from Montreal to Ft Lauderdale for a family of four would cost $2774.20 Canadian which includes $530.20 in taxes and fees on Air Canada. Flying JetBlue on the same dates out of Burlington Vermont would cost $1038.40 including $227.24 in taxes. The difference $1736.00. So you can see that the Americans have a much better system for Air Travellers, and much less Government taxes.

If these same type of differences apply to the cost of Jet Fuel, Landing and Take Off Fees etc; you can see that we might have a problem competing with Anchorage.

Posted by: owl on October 9 2007 8:43 PM

With respect to predicting the number of passenger movements through YXS, it is not quite as simple as using the predicted percentage increase of population in the region. That is really only one factor and not even an indicator factor.

For instance, the number of passenger movements between 1989 and 2006 went from 244,000 to 395,000. The population really did not change substantially over that time while the passenger movements increased almost 62%. The annual fluctuations of passengers movements varied from a high of 15% increase to a low of 14% decrease. Such fluctuations obviously have to do with changes in flight patterns, connections, competition, fares, and business needs. For instance, we are actually just achieving the numbers first reached in 2000 at 393,500 passengers.

The numbers were taken from the YXS report 2005-2030, table 5, page 39 and were rounded to the nearest 500.
Based on table 8, page 47, the forecast for passengers in 2024, which is 18 years from 2006 is 415,000 low, 627,500 medium, and 884,411 high. The medium rate is actually right in line with the increase over the past 18 years.

BTW, the high figure used for 10 years from 2006, 2016, is 615,000, not 800,000. The medium is 516,000.

So, whose figures do we use?

One thing is for sure, there are different factors that are indicators. Population is not one of the key ones.

The information below shows year, passengers and change over the base year of 1989.

1989 243,912
1990 280,726 15.1%
1991 241,413 -1.0%
1992 243,266 -0.3%
1993 240,723 -1.3%
1994 272,298 11.6%
1995 284,342 16.6%
1996 304,481 24.8%
1997 312,303 28.0%
1998 323,030 32.4%
1999 352,866 44.7%
2000 393,397 61.3%
2001 362,087 48.4%
2002 325,522 33.5%
2003 339,817 39.3%
2004 340,397 39.6%
2005 376,289 54.3%
2006 394,407 61.7%

Posted by: owl on October 9 2007 8:46 PM

"A new Airport an hours drive from Montreal in Plattsburgh N.Y. has a terminal built by the Government and pays no property taxes, federal rents or interest on debt."

I guess that is why the USA is a socialist system and Canada a market driven economy.

;-)

Posted by: owl on October 9 2007 8:48 PM

I think we should look into growing mushrooms in the empty containers on the backhaul to Asia.

;-)

Posted by: Palopu on October 9 2007 9:38 PM

Owl. Nice figures however you have to take these figures to the next level and try to ascertain how many of them are flights by Northern Mountain Air, Central Mountain etc; These small airlines run regular service to various destinations on a daily basis and are counted in the total number of passengers through the Airport.

Now if you were to eliminate all the present Air Canada, Westjet, and other small airlines from the forecasted figures, because none of these airlines need an extended runway to operate, and could (admitted by the firm doing the Airport 20 year plan) continue to operate with two of the present 3 runways for the forseeable future, and handle any forcasted increase in passengers. you would then come up with a possible increase of one or two cargo flights a day, and maybe a few International Flights that would require a longer runway.

Hardly an impressive figure for building a $36 Million dollar expansion to the present system.

I think that when you look at increases in passengers at the Prince George Airport you should keep in mind that this Airport has one major flight landing and taking off every hour over a 16 hour period. Ie; 7am to 11pm. They are basically closed from midnight to 7am. So they have the capacity to handle a 100% increase in traffic without making any significant changes to the Airport.

One or two major flights per hour for an Airport is insignificant.

Posted by: diplomat on October 9 2007 10:29 PM

Steaks and mushrooms are becoming ever more popular in Asia, because the living standard of the people is on the rise!

Fiddleheads...well, maybe not.

"I think there were extensive viability studies done and checked by the experts who had to make sure that there is indeed a market before funds were approved and committed."

Green light given, sit back and relax!

Obviously some observers here choose to ignore that repeated in-depth studies were indeed done and rather prefer to speculate and predict gloom and doom.

Perhaps the whole idea would have found a more eager acceptance in Prince Rupert, Terrace or Kamloops, especially Kamloops which grabs everything way before anybody else gets the idea to apply for it!

Check out the Kamloops city website and compare it to Prince George's city website!

The Kamloops site is brimming with optimism and pride and confidence in the future!!!

Cheers!

Posted by: NMG on October 9 2007 10:53 PM

If there is one thing that PG needs, it's people with vision and people willing to think big. It's entirely possible that things won't turn out as planned, however, sitting back and doing nothing to try and grow the City will all but ensure that we get left behind.

I think it's about time that PG sheds that small town mentality and starts to think big.

Posted by: owl on October 9 2007 11:34 PM

Okay, so some of them are ctaully not flying because they are in all those little panes. They are actually driving. Right?

The topic was passengers counts .... You started it Palopu .... the topic was not runway lengths.

The airport is more than just runway length ... there is a terminal which has to be planned, parking that has to be provided, ticketing stands that have to be manned, cars that have to be rented ....

I really do not care where the traffic comes from ... for some reason people are flying more than they were before ..... too many shitty roads???? gasoline too expensive???? too much disposable income????? not enough people in town to do the work so outsiders hired for shor term work????

You tell me .... they can come in helicopters, piper cubs, cessnas, 10 seaters, 60 seaters, 120 seaters, ...and soon maybe even 240 seaters ..... they all add up to passengers moving through the terminal needing more service, maybe even more hotel rooms, more rental cars, more taxis .... more restaurant food ... more ... more ... more .....

They can also be locals spending their momey elsewhere ... going to concerts in Vancouver instead of here because we do not have the facility or the size of audience here ... going to Vagas to gamble because the Casino has wet thier appetite for bigger and better things .... travelling the world because the Canuck buck is worth more .....

God, the permutations and combinations of reasons why people are travelling more by air are endless ... BUT, they are travelling more by air short or long runway, large or small plane, to Smithers or to Taipei ... who knows, who cares.

The airport is growing no matter which way you want to interpret it and the more options are made available, the more people will travel.

Posted by: owl on October 9 2007 11:39 PM

"If there is one thing that PG needs, it's people with vision and people willing to think big"

Actually there are plenty of those.

What we need are people who can carry those visions through to a successful completion, people with money, people with know how, people who are willing to invest and people who know which are opportunities which will work and those tht are pie in the sky thinking.

We need people who are prepared to provide quality and not some fly-by-night operation.

Posted by: diplomat on October 10 2007 8:58 AM

"If there is one thing that PG needs, it's people with vision and people willing to think big"

Precisely, NMG! I am with Pal on the Cameron Street thingy, but I won't classify a $36 million dollar runway extension project as a fly-by-night operation.

The Confederation Bridge concept also started with pie in the sky thinking - now it is a successful connector and accepted as an engineering marvel and object of great pride!

Posted by: Palopu on October 10 2007 12:37 PM

Nuff said.

Its pretty obvious that people will not accept the fact that the expansion of the Airport Runway is about spending Airport Improvement Fee money. If they didnt expand the Airport they would have to reduce or get rid of the Fees. Now with the expansion they can keep the fees in effect for the next 20 years.

As outlined above the CEO of the Montreal Airport and Im sure the Vancourver Airport are on record as stating that the Federal Goverment is using these Authoritys as **Cash Cows**

It seems some people can not see when they are being duped.

A few Cargo Jets landing in Prince George a day (maybe) and the possibility of a few International flights is hardly a **vision**

It will take 20 years to get back your original investment, and the only people who might make a buck are the oil comanies selling jet fuel.

Have a nice day.

Posted by: Buzz on October 10 2007 2:38 PM

"NUFF SAID": Amen to that. Accept the fact that the airport authority are evil doers who are "duping" all of us. We are all stupid, the airport authority are all manipulating dummies who can't see the crimes they are committing against us poor sheep, and we'll all become extict anyway because the world is ending soon.

Have an even nicer day!

Posted by: diplomat on October 10 2007 4:11 PM

"NUFF SAID"

Apparently everybody has been duped. Even the federal and provincial governments who requested and conducted viability studies and then opened the tightly guarded purse strings - sad state of affairs.

Good thing that it isn't true!

Posted by: YamaDooPolCat on October 10 2007 8:52 PM

"If there is one thing that PG needs, it's people with vision and people willing to think big. It's entirely possible that things won't turn out as planned, however, sitting back and doing nothing to try and grow the City will all but ensure that we get left behind.

I think it's about time that PG sheds that small town mentality and starts to think big."

Actually there are way too many that think PG is Vancouver, and therefore needs to be over governed and that businesses will come crawling to city council begging to be let into PG.

PG definitely does not have the small town welcome wagon. It's more like, get lost and take that horse you rode in on with you as you leave! And last one out turn off the lights.

Posted by: owl on October 10 2007 11:46 PM

"It will take 20 years to get back your original investment"

Hey, that sounds like a good investment to me. How long do you think it takes to get back an investment in a nuclear plant at the Tar Sands?

Posted by: metalman on October 11 2007 7:55 AM

There won't be enough water left in 20 years to run a nuclear power plant, or the tar sands, unless they figure out a way to reduce their water needs.
metalman.

Posted by: Palopu on October 11 2007 9:06 AM

Owl. Thats just to get back the $36Million. You still havent made a red cent. Who's money is being invested in the Tar Sands. I suspect that there is some private money invested. This Airport thing is all Government and Taxpayer money. Hardly an **investment**, except in terms of spending tax dollars.

Its nice to see that Buzz and Diplomat have finally got it right. Now all we have to do is hope that we live long enough to see the final results.

Posted by: diplomat on October 11 2007 10:28 AM

"Its nice to see that Buzz and Diplomat have finally got it right."

Aren't you relieved now, Palopu?

"It will take 20 years to get back your original investment"

To get $1.8 million back annually (net, of course after all the expenses like interest have been paid) times 20 = $36 million convinces me even more that I had not been baffled with fertilizer by anyone!

Counting the permanent jobs that will be created and spin-off benefits to the local economy this promises to be a real winner all around!

I am glad I took a positive view of it from Day One - else I would feel as if I had been duped into believing that it was a bad idea!

Cheers!