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CATHAY SEES EXPORT OPPORTUNITIES IN CALGARY
November 3, 2014
CX 747 at YYC
Cathay Pacific has launched all-freighter service to Calgary, in large part to carry oil and gas equipment to the Asia Pacific region. (Photo: Calgary Airport Authority)

Calgary is an energy boom town, and Cathay Pacific knows it. That’s why the carrier commenced twice-weekly service to this western Canada market on October 18.
“They came for oil and gas equipment,” said Mark Ruel, director, air service development and industry relations at the Calgary Airport Authority. That equipment is manufactured in Alberta and shipped all over the Asia Pacific market, including Australia. Its biggest market is China.
“The Chinese market cannot be understated,” said Bruce Graham, president and CEO, Calgary Economic Development. “It is one of the top three most important markets for Calgary and Alberta.”
As a result, Graham estimates that in the past four years, some $43 billion of energy-related capital investment has come into Canada through Calgary. That investment ranges from pipelines, oil sands projects, to LNG-related projects.
“We are poised for further economic growth,” Graham added. “The energy industry is capital intensive, and increasingly, Alberta and Calgary are becoming the supply chain distribution place by which manufactures come. They have a need for air cargo and dedicated freighters.”
Enter the opportunity for Cathay Pacific. The routing for the Cathay freighter service is Hong Kong-Anchorage for a fuel stop-Rickenbacker International Airport in Columbus, Ohio-New York JFK-Calgary.
The service out of Calgary is an export-oriented flight for Cathay. “Calgary is an interesting market in that we have more exports than imports and Asian carriers are looking for backloads to go back to Asia to balance their loads,” said Ruel.
Asiana used to service Calgary with thrice weekly service, but pulled out in 2008 due to the economic crisis. Today, Calgary is the only airport in Canada, with the exception of Toronto, to offer direct air cargo links to Asia.
Ruel estimates that today Calgary’s total air export market is 51,000 metric tons, with the Asian market being 14,000 metric tons.
“Most of that freight is main deck,” he said.
While ocean services get the lion’s share of this freight, the air market remains strong due to the need to ship sensitive shipments via air. “We complement the ocean shipping industry,” Ruel said.
Fred Ruggiero, vice president for cargo, Americas, at Cathay Pacific Cargo, recalls when his carrier had to charter a flight out of Houston to accommodate a 60-ton oil riser emergency shipment. “As the shipment was being loaded, the shipper said that he would have paid any amount of money to fly the shipment out quickly because the rig was burning US$10 million a day,” he said. “When an oil rig is down, it’s costing a lot more than air freight costs.”
A big advantage for Cathay is, historically, shippers had no alternative but to truck freight out of Calgary to Chicago-O’Hare, Houston and even as far as Miami to find space on an aircraft.
“When we started investigating the potential for air freight in Calgary, we were shocked to see how far freight travels to get on an aircraft,” Ruggiero said. “That’s why we started with two flights a week.”
But he also reveals that Cathay has plans is to quickly ramp up this service to thrice weekly. “Once we have three flights a week, there is no reason for a shipper to truck shipments to Chicago or beyond,” he explained. “Trucking to Chicago takes two days. If we have three flights a week that are spaced evenly apart, it’s faster for them to wait for a day and give their shipments to us rather than to truck them.”
There’s another reason for Cathay selecting Calgary for this service: good infrastructure. Calgary offers the largest infrastructure for cargo of any airport in Canada. Close to C$100 million (US$87 million) has been invested in infrastructure improvements to accommodate cargo there in the past 16 years.
Today the airport has three aprons. Apron II, with 40,000 square meters, is dedicated to freighters. Apron VII, with 55,000 square meters, is dedicated to couriers that service Calgary, including FedEx, UPS and Purolator. “Our new apron, Apron IX, is 60,000 square meters and is dedicated to international freights. It opened two years ago,” he said.
Currently, Apron IX can serve three Code F aircraft.
In anticipation of more freighter service, Calgary is doubling the size of the Apron IX by another 60,000 square meters. “This has been board approved and is shovel-in-the-ground already,” Ruel emphasized. Completion is expected by next summer.
To facilitate quick turnaround for cargo operations, all cargo aprons offer in-ground fueling, nose tethers, wide parking pads, spacious warehouses, 24-hour customs services such as food inspection, and easy transfer from airside to ground side.
“You don’t often stumble across a freighter station that has all bells and whistles you want,” Ruggiero said. “It’s built for cargo.”
For example, a 747 aircraft can turn in less than 90 minutes. “That includes fueling the aircraft, and unloading and uploading the aircraft,” Ruel emphasized.
Also making Calgary unique is its third party service providers: ramp handlers, cargo handlers, specialized handlers for horses and live animals.
To accommodate cargo, Calgary added a fourth runway, operational on June 28, 2014. The runway is located beside a road artery to offers easy access for trucking services.
In addition, the airport offers extensive warehousing. In April 2012, the airport opened a 100,000 square-foot multi-tenant facility, which today is fully leased. Plans are being finalized for an additional 100,000 square feet. Authorities expect its completion in 2016.
“We have two live animal facilities, and are building a third,” Ruel added. “Our objective is to offer the live best animal facilities in North America and be comparable to those at Frankfurt, Luxembourg and Amsterdam.
With 1.8 million square feet, Calgary is also the leading airport in Canada for on-airport warehouse space, and is currently opening another 200,000 square feet. The airport’s cargo master plan calls for adding additional warehousing space in 2016.
Besides Cathay Pacific, other all-freighter service is provided by CargoLux thrice a week, CargoJet twice daily, and Purolator, FedEx, DHL and UPS daily.
“Plus we do on average two widebody charters per week,” Ruel added. “Basically, we have 99% of the freighter market in Alberta and western Canada.”

By Karen E Thuermer
Correspondent | Washington

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