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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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BC Ferries posts rise in bunker consumption in fiscal 2018

Canadian firm also discloses amount spent on upgrades and new vessels.



Image credit: BC Ferries


Updated on 20 Jun 2018 08:45 GMT

BC Ferries reports that it recorded a rise in bunker fuel consumption in fiscal 2018, during a period in which it posted the highest passenger traffic levels in 20 years and the highest levels of vehicle traffic ever.

To accommodate the higher traffic levels and improve customer experience, BC Ferries says it provided over 174,000 sailings, with 2,962 more round trips than required under the Coastal Ferry Services Contract and 1,190 more round trips compared to the prior year.

Many of these sailings were added on inter-island routes, and while they were required to carry the traffic, they came at a cost to BC Ferries. Furthermore, the company also welcomed three new Salish-class vessels into service.

As a result, these initiatives resulted in an increase in fuel consumption, as well as labour and training-related transition costs.

Overall, operating expenses for the 12 months ended March 31, 2018, increased by $56.5 million, or 7.8 percent, from $726.2m to $782.7m, and net earnings decreased as costs grew faster than revenues.

Consolidated net earnings for fiscal 2018 were $59.9m.

Vessel upgrades and new additions

In its year-end results, BC Ferries noted that it spent $110.1m in vessel upgrades and modifications, and $81.6m in new vessels.

As previously reported, the Spirit of British Columbia was the first of two 'Spirit-class' ships to undergo conversion, while its sister vessel, the Spirit of Vancouver Island, is expected to have its conversion completed during the spring of 2019.

Meanwhile, BC Ferries' third and final LNG-powered Salish-class vessel, the Salish Raven, arrived in Canada a year ago - in June 2017 - following the earlier arrivals of the Salish Orca and Salish Eagle.

Total capital expenditure for fiscal 2018 amounted to $252.3m.

Fuel rebates

Earlier this month, advised its customers that on June 27 it will be removing the fuel rebates it currently has in place "due to current world fuel market conditions".

BC Ferries uses a fuel rebate/surcharge mechanism to manage the volatility in the price of fuel. When fuel prices are lower, BC Ferries passes lower fuel prices on to customers through a fuel rebate; but when fuel prices are higher, BC Ferries charges a fuel surcharge to cover the additional cost of fuel.

Fuel rebates of 2.9 percent for BC Ferries' major and minor routes and 1.9 percent for the northern routes have been in place since the spring of 2016.






Related Links:

BC Ferries removes fuel rebates due to higher bunker costs
Newly converted LNG-fuelled ferry classed by ABS
BC Ferries vessel removed from service for LNG conversion
BC Ferries orders two hybrid diesel-electric vessels
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