Port of Montreal CEO says he's 'skeptical' of hydrogen's potential

Some are pinning a lot of hope on hydrogen. Is it well advised to invest massively in this sector?

Canada has entered into agreements abroad to develop an action plan for hydrogen development and supply. The federal government has also presented a hydrogen strategy for 2020.

The economic future of hydrogen is not what we imagine , according to the CEO of the Port of Montreal, Martin Imbleau, who says he is “skeptical” about the potential of this energy carrier.

Hydrogen is an energy vector, it is not energy, says Martin Imbleau in an interview for the podcast Question d'intérieur, on the Ohdio application. For him, hydrogen remains a solution of last resort, an exceptional solution.

Technologically and economically, you will allow me to be a little skeptical today. But in small doses, [it would be possible], for example, to make methanol or for heavy trucks over short distances, explains Mr. Imbleau.

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Canada has entered into agreements with Germany and the European Union to develop an action plan for hydrogen development and supply. Ottawa has also presented a strategy on hydrogen in 2020. The governments of Quebec and Ontario are also interested in the development of this energy vector.

However, everything remains to be done. Using clean energy to create hydrogen for specific purposes has yet to be studied and analyzed on the costs and the real economic potential for Canada.

Martin Imbleau is of the opinion, moreover, that Canada has missed the opportunity to become a natural gas supplier of choice for Europe in the context of the war in Ukraine. Russia has cut its gas supply to Europe by 80% in the past year.

Canada is not in a position to replace Russian gas, nor will it be in the future, according to Martin Imbleau. It is a missed historical appointment, he says. We moved on. There were plans some time ago to provide solutions specifically for Germany, to counter the Russian threat. I worked there. These are projects that never saw the light of day. And I don't really believe in it anymore.

There are no adequate transport capacities to bring gas from the West to the East Coast, Martin Imbleau points out. It would be too expensive, he argues, and it is unlikely to quickly achieve regulatory approval and social acceptability.

Americans who historically were a major importer turned literally in a few months, a few years, to become a very, very, very important net exporter. So, for Canada, it's a miss.

In 2022, the Port of Montreal returned to its 2019 volume of activity. The logistics chains have returned closer to a normal level. A supply chain is lung capacity, says Martin Imbleau. We were going faster, we didn't have enough air. There, we go slower and we have enough air!

More space, more storage, less demands, less need for a speed of execution between supply and demand, so there is slackin the machine, which means that all over the world, the supply chains have much less pressure, and the prices have nothing to do with what happened.

Ship jams waiting in ports are now a thing of the past. I was in Los Angeles two years ago, there were 50 ships offshore. I was there last week, there were three! So, we are no longer in the same logic at home. The number of containers on the ground is quite normal all over the world. There are practically no more ships waiting.

The CEO of the Port of Montreal, however, fears a new supply crisis in the coming years. Are we going to relive this crisis? There is a strong doubt that yes, because there are no solutions that have been put in place. Space issues and supply chain issues that are subject to supply and demand, nothing has happened in the last three years.

According to him, there is an urgent need to digitize the supply chain in addition to adding storage space. A port should not be managed like a warehouse. A port is a transit zone, it has to come in and go out quickly, explains Martin Imbleau.

Meanwhile, port activities have always been considered a leading indicator of the economy. We see lower volumes at the beginning of the year, says Martin Imbleau. What is happening today gives us an indication of the level of import and export in three to six months. We are really the lung in both directions. And we see a drop in imports and exports of 10 to 12%.

Containerization is the most important indicator, because it reflects processed and unprocessed products in import and export. You're not much wrong when your containerization volumes go down. And on the west coast, the drop is even more significant. Volumes are down from the gains of recent years.

Martin Imbleau calls on public authorities to invest massively in infrastructure as a possible recession looms. The current context militates in favor of the development of the port expansion project in Contrecœur, according to him.

This is the year of all decisions. We are about to finalize our procurement process. We will choose in the next few weeks, the next few months, a consortium that will be responsible for building and [operating] this terminal. Starting in 2027, when the terminal is commissioned, there will be approximately 50% additional capacity on the South Shore to streamline the logistics chain for Quebec and Ontario.