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Post by Low Light Mike on Dec 23, 2008 14:27:13 GMT -8
Here's a link to a new blog that the newspaper TheProvince is running, re "maritime matters". communities.canada.com/theprovince/blogs/onthewaterfront/default.aspxI'm sure lots of us read various types of blogs on regular or semi-regular basis. (I read one on sports uniforms & logos), and blogs with extended "reader comments" sections are maybe a vehicle that's part way between a forum like we have here, and a traditional newspaper column. I'll be checking this new one out. This new blog may become another source of springboard discussion for our own forum threads, similar to how we already springboard discussion from regular news stories and website items. Obviously, one of the benefits of our own forum here, is that we can take issues from many sources and springboard them into meandering, organic discussions that can last weeks or months, with various pictures, weblinks, and diversions along the way.
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Post by Low Light Mike on Dec 23, 2008 19:31:05 GMT -8
An entry in that blog today is re the recent BCFS bond issue. This is the first mention that I've seen of this bond issue in the mainstream media. (the only other places I've seen mention of this is on the BCFS website and in our own forum).
The blogger asks some good questions about the charade of the bond issue (it might eventually become gov't debt, if BCFS defaults on it).
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Nick
Voyager
Chief Engineer - Queen of Richmond
Posts: 2,078
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Post by Nick on Dec 23, 2008 19:47:57 GMT -8
I seem to recall Chris Montgomery posting here a few times as a guest, before the big crackdown on guest posters. She seems to be one of the few journalists on the West Coast that does a bit of research before publishing her work.
I intend to follow this blog closely for the next while. Hopefully she continues to ask good, probing questions about the actions of BCF, and the provincial government.
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Post by ferryrider42 on Dec 23, 2008 20:23:27 GMT -8
An interesting post that certainly started to make me think about things. I never really thought about how privatization changed things until now. But it appears like Ferries can go out and simply borrow as much money as it wants. My little brain summarized the blog entry as follows:
- Ferries can now borrow as much money as it wants, without asking for government’s approval. - Banks have no problem lending Ferries money since they know that in the end the bonds are secured by the government. - Later down the road, after one or two elections, the new government will have to sort out the mess.
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Post by Low Light Mike on Dec 23, 2008 20:50:54 GMT -8
Banks have no problem lending Ferries money since they know that in the end the bonds are secured by the government. Except that it's not a direct-link re the government securing the bonds. It's a bit of a messy possibility, but here's how I think it would work: 1) BCFS defaults on it's debt. By doing so, it is "insolvent" or then files bankruptcy, or some similar messy thing (as defined in article 14 of the below-linked Coastal Ferry Service Agreement). 2) Province of BC exercises it's right to purchase the ship assets from BCFS, upon this event of default (as defined in article 8 of the Coastal Ferry Service Agreement). 3) The bank and or bondholders now see that the security for the debt has changed ownership (from BCFS to the Province). Presumably, the Province would then pay out the debt to the banks / bondholders to prevent them from seizing and liquidating the ship assets. www.bcferrycommission.com/Coastal_Ferry_Services_Contract.pdfThis could be the catastrophic event that brings the Ferry System back under Government management. (ps: this is all based on my very amateur reading of the Coastal Ferry Services Agreement).
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Post by landlubber on Dec 23, 2008 22:19:15 GMT -8
It seems to me (an outsider, I admit) that the BCFS is still very much under the control of polititians anyway. Until it is fully privitised, it will never be able to react on it's own to market conditions as they exist and fully adjust to the marketplace it serves. Above all else, what it needs is competition across the Georgia Strait and elsewhere. Unfortunately, government subsidization is the very thing that will keep this from happening.
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Neil
Voyager
Posts: 7,171
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Post by Neil on Dec 23, 2008 22:54:30 GMT -8
I seem to recall Chris Montgomery posting here a few times as a guest, before the big crackdown on guest posters. She seems to be one of the few journalists on the West Coast that does a bit of research before publishing her work. I intend to follow this blog closely for the next while. Hopefully she continues to ask good, probing questions about the actions of BCF, and the provincial government. Both the Province and Sun used to have a reporter on the marine 'beat', which makes sense in a port city like Vancouver. That ended some time ago. This new blog is at least a move to cover the beat on the internet, where Can West and other media companies are focussing more and more. The media giants are desperate to increase their net presence, since it's dirt cheap compared to running presses, paying pressmen and all the other people who put out the actual paper. So far, though, advertising hasn't followed. They've made a good choice in Christina Montgomery.
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Post by Low Light Mike on Dec 24, 2008 20:25:27 GMT -8
amateur reading" to say the least - That's what I called it. Glad you agreed with me. Although I smell some condescension there. Not having met you in-person, I'm not sure how to take that lack of tact. The only thing that you got right here is the bonds. - Thanks for the bonds compliment. Re the "only thing" part, see above comment from me. With the highest respect, Keep to ferry geeking and bus geeking. - No, I won't. Sorry, you can't dismiss my participation like that. Although dealing with your style of post isn't fun for me, I still enjoy the overall topic, and am eager to learn from others including you. Merry Christmas right back at ya, Paul.
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Post by Low Light Mike on Jan 25, 2009 13:15:36 GMT -8
If any of you forum-folks miss our old member "Cascade", you can find him on the Province Blog in the reader-comments section.
He's a regular poster on that blog re reader-comments, and you can find him easily by noticing his content, style, phrases etc which were familiar here on this forum. And he's chosen a good English pseudonym too.
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Nick
Voyager
Chief Engineer - Queen of Richmond
Posts: 2,078
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Post by Nick on Feb 12, 2009 10:56:49 GMT -8
I find it interesting that Ms. Montgomery's blog hasn't been updated since January 20th. It's not as though there has been a shortage of maritime news (QotN settlements, BCF Fuel rebates on minor routes, among others) so why the delay?
She has been updating other blogs, like the "Vancouver City Limits", so it's not as if she's on vacation or something.
I'm not really feeling a sense of entitlement or anything, I just find it interesting that she starts a blog in December, updates it a few times over a period of just over a month, and then seems to drop it. I would think that if she were trying to attract readers, she would have made more frequent updates, especially in the first few months of it's existence.
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Post by Low Light Mike on Feb 12, 2009 12:12:57 GMT -8
I find it interesting that Ms. Montgomery's blog hasn't been updated since January 20th. It's not as though there has been a shortage of maritime news (QotN settlements, BCF Fuel rebates on minor routes, among others) so why the delay? She has been updating other blogs, like the "Vancouver City Limits", so it's not as if she's on vacation or something. I'm not really feeling a sense of entitlement or anything, I just find it interesting that she starts a blog in December, updates it a few times over a period of just over a month, and then seems to drop it. I would think that if she were trying to attract readers, she would have made more frequent updates, especially in the first few months of it's existence. She is experiencing computer-problems regarding the updating of her maritime blog. (that's what I know from some communication that I've had with her). ....and now she's probably reading this here, and smiling.....knowing that we miss her work.
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Post by kerryssi on Feb 16, 2009 15:37:29 GMT -8
Chris Montgomery had an excellent article in the province this weekend about the ferrys and why they will not be farmed out. I would like to add my own opinion about why the small routes are hit with larger fare increases. The small routes have a large number of commuters who have no choice but to use the ferry to get to their jobs. On the major routes travel is optional.
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Post by Low Light Mike on Feb 18, 2009 15:41:07 GMT -8
Ms. Montgomery has another blog-post aimed at BC Ferries, and this contains a copy of a "employee update" letter from Mr. Hahn to the company. I think most of us will find it interesting. It includes a part that insinuates that BC Ferries has decided to not roll-back the scheduled union wage rate increases. How lovely of management to tell the union that they have decided to honour the Ready-settlement for wages (because BCFS is a better-shape entity than WSF ). I wonder if the workers will send a similar letter to management informing management that they've decided to come to work each day, because they are a better company than WSF.... ...anyways, I presume that those of us interested in these issues are already checking Ms. Montomery's blog regularly, so you don't need my promotion of it here.
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Post by Northern Exploration on Feb 18, 2009 17:11:00 GMT -8
If someone could IM me her blog address it would be appreciated ;D. Thanks.
*NM I gots it already, I had it under the province not the name.
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Post by Low Light Mike on Feb 18, 2009 17:39:29 GMT -8
If someone could IM me her blog address it would be appreciated ;D. Thanks. *NM I gots it already, I had it under the province not the name. For anyone wanting this blog address: it is posted in the 1st-post of this here thread. Really, it is.
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Post by yvr on Feb 18, 2009 19:41:11 GMT -8
I hope all of you read Chris's February 16th blog: "Why Aren't We Buying Cheap Ferries".
(quote) Want specifics? Last week, for $50 million, you could have bought three 100-metre, 350-passenger, 150-car, double-ended Caterpillar-engined ferries. Four years old. Job lotted. Available now. And they're SOLAS compliant, which means they meet the international standards that most ferries around the world sail by. and they would have resale value — something most of Ferries' vessels don't have.
Looking at the value of those 3 ferries, what would the Northern Adventure be worth in 2009 dollars - a scary thought!
YVR
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Neil
Voyager
Posts: 7,171
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Post by Neil on Feb 19, 2009 14:49:08 GMT -8
Want specifics? Last week, for $50 million, you could have bought three 100-metre, 350-passenger, 150-car, double-ended Caterpillar-engined ferries. Four years old. Job lotted. Available now. And they're SOLAS compliant, which means they meet the international standards that most ferries around the world sail by. and they would have resale value — something most of Ferries' vessels don't have. If BC Ferries were currently in the market for three 150 car ferries, and if they had the spare $50 million to buy them, this item might have a shred of relevance. But they're not, and they don't, so it doesn't. Ms Montgomery also hasn't given us a source for this, or any more than the barest of specs. In relation to the purchase price of the Sonia, or the building of the Island Sky, this bit of news is a non sequitur. With regard to resale value for their boats: It's largely irrelevant what the sale of the ' Tsawwassen or ' Esquimalt brought them, as these boats both gave more than 45 years of service. Anything more than scrap price is a bonus.
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Post by WettCoast on Feb 19, 2009 22:10:36 GMT -8
You may well be wrong about this Neil. The Burnaby & Nanaimo are getting fairly long in the tooth now (45 years). If suitable near-new vessels are available at attractive prices, maybe they should consider making deals now, rather than building new in a few years. This does make sense, at least to me. The question is are there vessels available that are really suitable for our needs?
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Post by yvr on Feb 19, 2009 23:35:33 GMT -8
Chris stated that 3 fairly new ferries were available for $50 mil. With that as a barometer, what do ship brokers or knowledgeable individuals feel the Northern Sonia is worth? Most probably the depressed market conditions have taken a heavy toll on it's value?
Getting back to the four year old double enders, perhaps BCF should purchase the trio, using the old saying 3rd time lucky. This takes into account the Kuper and Sonia. They were numbers 1 and 2 and as we all know, over budget. If BCF had to do it all over again odds are these vessels would not be in the fleet, especially the "Refit Queen" Northern Adventure.
YVR
quote author=hornbyguy board If BC Ferries were currently in the market for three 150 car ferries, and if they had the spare $50 million to buy them, this item might have a shred of relevance. But they're not, and they don't, so it doesn't.
Ms Montgomery also hasn't given us a source for this, or any more than the barest of specs. In relation to the purchase price of the Sonia, or the building of the Island Sky, this bit of news is a non sequitur.
With regard to resale value for their boats: It's largely irrelevant what the sale of the 'Tsawwassen or 'Esquimalt brought them, as these boats both gave more than 45 years of service. Anything more than scrap price is a bonus. [/quote]
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Post by Northern Exploration on Feb 20, 2009 7:52:14 GMT -8
Chris stated that 3 fairly new ferries were available for $50 mil. With that as a barometer, what do ship brokers or knowledgeable individuals feel the Northern Sonia is worth? Most probably the depressed market conditions have taken a heavy toll on it's value? Getting back to the four year old double enders, perhaps BCF should purchase the trio, using the old saying 3rd time lucky. This takes into account the Kuper and Sonia. They were numbers 1 and 2 and as we all know, over budget. If BCF had to do it all over again odds are these vessels would not be in the fleet, especially the "Refit Queen" Northern Adventure. YVR quote author=hornbyguy board If BC Ferries were currently in the market for three 150 car ferries, and if they had the spare $50 million to buy them, this item might have a shred of relevance. But they're not, and they don't, so it doesn't. Ms Montgomery also hasn't given us a source for this, or any more than the barest of specs. In relation to the purchase price of the Sonia, or the building of the Island Sky, this bit of news is a non sequitur. With regard to resale value for their boats: It's largely irrelevant what the sale of the ' Tsawwassen or ' Esquimalt brought them, as these boats both gave more than 45 years of service. Anything more than scrap price is a bonus. [/quote] No doubt the BFGF (Markus' Big Fat Greek Ferry ;P) has cost more and perhaps much more than anticipated. And in hindsight perhaps too much. As the saying goes hindsight is 20/20. But the people who grouse about the expenses have to keep in mind that no other suitable vessel was available so quickly. Given what I have seen, it appears BCFC did due dilligence on the search and purchase. There was a constant complaining (rightly so) on the behalf of the people who rely on the Northern routes, about being without service during that period. Imagine the economic impact if it had stretched on until a ship was built. Second guessing decisions can be fun. However when people omit important parts of the equation, especially journalists, to suit their purposes and to just furment controversy, then I have a problem with that. And more so if they take todays context and then assume those details back onto a previous period. As an asside I have found the recent examinations into Lincoln and whether he was as big a hero as some feel or whether he was a racist. The bottom line for some has come down to not just projecting back onto Lincoln todays standards but to judge him according to the context of his time as well. According to todays standards he is a racist and didn't totally believe in equality. Judged by the context of his time, he started a process of change that was massive and likely went as far as he could. In the realm of 20/20 hindsight the NorAd nee BFGF nee Sonia nee etc. will be a very expensive ferry. Only time will tell over the period of her life whether she was a good or a bad but necessary addition to the fleet. Think of it this way. All the complaining about the NorEx being built offshore, is offset by the economic boon the new Queen of Refit is to the marine industry in BC. She is a built in stimulus/infrastructure that will likely have impact for years to come .
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Neil
Voyager
Posts: 7,171
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Post by Neil on Feb 20, 2009 19:32:31 GMT -8
You may well be wrong about this Neil. The Burnaby & Nanaimo are getting fairly long in the tooth now (45 years). If suitable near-new vessels are available at attractive prices, maybe they should consider making deals now, rather than building new in a few years. This does make sense, at least to me. The question is are there vessels available that are really suitable for our needs? BC Ferries is apparently planning to replace the 'Burnaby and ' Nanaimo with 185 car vessels, so these would be a bit on the small side. Aside from the fact that we really know nothing about them. In the 49 years of BC Ferries history, I don't think I can recall one instance of them ever acquiring vessels for future consideration-to replace vessels that still had some good years in them. The Kuper might be an exception to that, considering that the Klitsa has not been retired, and there was not a crying need for a larger boat for the Thetis & Kuper run. Not saying it would be a bad idea, but it just doesn't seem to be they way they operate. I don't even know if the financial straitjacket the Liberals have put BC Ferries in would allow for a discretionary purchase like this. No doubt the BFGF (Markus' Big Fat Greek Ferry ;P) has cost more and perhaps much more than anticipated. And in hindsight perhaps too much. As the saying goes hindsight is 20/20. But the people who grouse about the expenses have to keep in mind that no other suitable vessel was available so quickly. Given what I have seen, it appears BCFC did due dilligence on the search and purchase. Agreed. We've seen the chart showing what was available at the time, with the positives and negatives to each vessel. Still, no one on this forum has the inside information, or the technical appraisal skills to give any worthwhile contrary evidence to the decision BC Ferries made. Not that that's ever stopped anyone so far. While we really can't appraise vessels they chose not to buy, WCK has suggested they might have leased until something more suitable could be bought or built. Apparently that option was rejected early on in the process, for reasons BC Ferries has never felt obliged to explain. Perhaps they felt it would be wasted money to modify docks and possibly the vessel when it was only to be in service for a limited time- they may have been right.
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Post by Low Light Mike on Feb 21, 2009 13:31:17 GMT -8
Regarding BCFS's ability to seize-upon ship-purchase opportunities, here is a snapshot of their financial inability to react to buying opportunities: (from the BCFS 12/31/2008 MD&A report) Liquidity and Capital Resources
We fund our operations and capital acquisitions with cash flow generated from operations, as well as bank financing and debt issues.
With the completion of the $108 million KfW loan in January 2009, our major financing requirements are now complete.
Our ongoing capital expenditures are expected to be significantly lower than in the previous few years. Over the next five years, we expect our cash requirements will be met through operational cash flows and by accessing our credit facility from time to time.
At December 31, 2008 our unrestricted cash and cash equivalents totalled $132 million.
We target maintaining a strong investment-grade credit rating to allow capital market access at reasonable interest rates. Our credit ratings at December 31, 2008 were A low (DBRS) and A- (Standard & Poor’s) and both rating agencies have assessed our rating outlook as positive.
In May 2008, we negotiated an extension of the $155 million credit facility by one year. The new maturity of this facility is May 12, 2013. At December 31, 2008, we had drawn $53 million on this credit facility.
In May 2008, to coincide with conditional acceptance of the Coastal Celebration, we received $90 million in proceeds under the loan agreement with KfW. This is a 12-year amortizing loan, at a fixed interest rate of 4.98%. The agreement defers the principal payments for the first three years to a second tranche on which interest only is payable at a floating rate. This principal is due June 2020.
In December 2008, we completed a $140 million, five-year senior secured bond issue. These private placement bonds bear interest at 6.214%, payable semi-annually. The net proceeds were used to repay our credit facility in January 2009 as the instruments matured, to fund capital expenditures and the debt service reserve related to the bonds and for general corporate purposes.
In January 2009, to coincide with conditional acceptance of the Northern Expedition, we received $108 million in proceeds under a further loan agreement with KfW. This is a 12-year amortizing loan, at a fixed interest rate of 2.95%, payable semi-annually. The proceeds were applied toward the purchase of the new vessel.
It doesn't look like there is much room / ability for unexpected vessel purchase opportunities. And how much more often would BCFS be able to go to the bond market to get more cash? I presume that the next bond issue will happen when BCFS needs cash to pay off the 1st German bank loan.
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Post by Dane on Feb 25, 2009 23:20:02 GMT -8
With the highest respect, Keep to ferry geeking and bus geeking. Having not noticed this comment until someone just pointed it out to me... Disrespectful, and unwelcome. Consider this negative peer reinforcement. If you disagree with something, or have something to add that's certainly not the way to do it, particularly if you feel like you are coming from a source of professional knowledge. In any work place I have been involved in that comment would be seen in bad form.
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Post by Low Light Mike on Jun 5, 2010 16:45:58 GMT -8
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Post by Low Light Mike on Oct 24, 2010 18:09:12 GMT -8
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