GNWT buys assets of NTCL

NNSL file photo The Northern Transportation Company Limited filed for bankruptcy protection assets were purchased by the GNWT to restructure and refinance its operations last April. The GNWT purchased the assets of the company to maintain marine transportation to remote communities.

NNSL file photo
The Northern Transportation Company Limited filed for bankruptcy protection assets were purchased by the GNWT to restructure and refinance its operations last April. The GNWT purchased the assets of the company to maintain marine transportation to remote communities.

The GNWT has purchased assets of the financially-troubled Northern Transportation Company Limited (NTCL).

Finance Minister Robert C. McLeod confirmed the $7.5-million purchase in a Dec. 16 news release.

The government took the action to protect the petroleum product supply chain through barging for isolated communities along the Mackenzie River and Arctic coast, which do not have other economical options for obtaining fuel and other goods.

“It is the role of government to ensure that essential services are provided to residents and that the costs for providing these services are affordable,” said McLeod in the news release. “Purchasing NTCL assets was good value for money and makes sure that the marine transportation sector in the NWT will be sustained. The GNWT will be reaching out to private sector partners in the coming months to come up with a made-in-the-North marine transportation services solution for our residents.”
Since April 27, NTCL has had court protection under the Companies’ Creditors Arrangement Act (CCAA) to facilitate restructuring and refinancing of its operations.

The Court of Queen’s Bench of Alberta granted the order providing protection for NTCL, and PricewaterhouseCoopers Inc. was named monitor.

The sale of assets to the GNWT was approved by the court at a hearing on Dec. 15.

At the hearing, the court ordered that an Alberta company and the GNWT submit their best and final offers to the monitor and NTCL by no later than 2 p.m. that day.

The offers were received prior to the deadline and reviewed by the monitor and NTCL.

The monitor recommended and the court approved the offer from the GNWT.

The CCAA process also came to an end as of Dec. 15.

The GNWT does not intend to operate the marine fleet with its own workers, but will look to partner with an experienced private sector marine operator.

Earlier this year, the territorial government issued a tender to find a new transportation provider following notice from NTCL that it would be discontinuing its business.

When the tender closed on Nov. 4, only one bid had been received, but it was deemed to be non-compliant with the terms and conditions of the tender.

Mayor Brad Mapes welcomes the purchase by the GNWT, saying it is a relief for the community.

“I honestly think that the GNWT was in a bad spot trying to figure out how to make this happen, and out of all the options I think this is the option that kind of makes sense,” he said.

Mapes predicted there is always going to be a need for barging in the NWT.

The mayor explained the GNWT purchase is also good for the Town of Hay River.

“It was obviously great for our community when you look at it through the Town of Hay River. We’re not worrying about who’s paying the taxes now,” he said, explaining that leases and taxes to the town are close to $700,000 a year.

Mapes added the town wants to be an active partner with the GNWT in trying to improve the barging operation out of Hay River to other communities.

However, he said the days are gone of barging involving a huge company.

“We’re looking at a smaller scale of company, which would fit what our community needs,” he said.

The communities served by barging out of Hay River include Tulita, Fort Good Hope, Lutsel K’e, Sachs Harbour, Ulukhaktok and Paulatuk.