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Economy

MTS adding 24% fuel surcharge to 2022 cargo shipments

Last modified: May 6, 2022 at 7:16pm


The NWT’s freight barges will apply a 24-percent surcharge to cargo shipments this summer in response to rising fuel costs.

The surcharge, first reported by the CBC, appears in a footnote in a document setting out the 2022 rates charged by Marine Transportation Services, the territorial government division that runs the barges.

Privatization of some aspects of that barge service is on the cards.

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The territory has been searching for private companies that would lease assets from MTS and “manage all aspects of the operation.”

A request for expressions of interest closed last week. If a suitable company is found, the territory hopes to appoint it by this fall and have that company manage barge operations from the summer of 2023 onward, for at least a seven to 10-year period.

The territorial government has run the barges since the 2017 season after former operator NTCL filed for creditor protection a year earlier.

Barges are a lifeline for isolated NWT communities and industries that don’t have year-round road access. MTS also supplies some Nunavut communities.

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Ever since 2017, the territory has stated its aim to find a private operator.

In the meantime, adding a surcharge for the 2022 season is the territorial government’s response to increasing fuel costs. That increase was brought on in part by Russia’s invasion of Ukraine and the subsequent disruption to global fuel supply.

The MTS shipping rates document states the surcharge will apply to all cargo shipments and will be “re-evaluated annually.”

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