PORTLAND – Canadian officials are preparing to seek bids from companies with interest in restoring ferry service between Nova Scotia and Portland, which ended three years ago because it was losing money.

Bay Ferries Ltd. of Prince Edward Island, which operated a high-speed catamaran between Portland and Yarmouth, Nova Scotia, has shown interest in bidding for the service, for which the province of Nova Scotia has agreed to provide a $21 million subsidy.

Ferry service ended in 2009, when Bay Ferries stopped operating The Cat, which reportedly was losing $7 million a year, in part because Nova Scotia stopped subsidizing the service.

It’s unclear whether the company would use a catamaran or a slower vessel for the new service.

Prospective bidders met Tuesday in Halifax, Nova Scotia, to discuss conditions for an upcoming request for proposals.

Portland Mayor Michael Brennan said Wednesday that he’s pleased the process is moving forward. He said he’s optimistic that ferry service will be restored because the province is committed to subsidizing operations during the start-up phase.

“It’s clear there’s going to be a strong commitment to making this happen,” Brennan said. “The history of having a ferry between Portland and Nova Scotia has been a positive one. We would like to work with them to make sure this becomes a reality.”

Nova Scotia is prepared to spend as much as $21 million over seven years to attract a long-term cruise ferry operation to Yarmouth.

A province-appointed panel of experts issued a report in September saying that ferry service to Maine could be viable if it provides a high-quality on-board experience, is supported by a sophisticated marketing strategy and leverages a strong tourist experience in southwest Nova Scotia.

The report said it would take an initial investment of $5 million for baseline research, advertising, vessel acquisition and financing to get the service running. Another $13 million would be needed to repair ferry terminals in Yarmouth.

Prospective operators will be expected to present plans to have a self-sustaining ferry operation once the government subsidy runs out.

Percy Paris, Nova Scotia’s minister of economic and rural development and tourism, said the province is open to seasonal and year-round ferry services, if the operator is focused on giving passengers a quality overnight experience.

“We’re leaving it in the hands of the bidders,” Paris said. “If we move forward on this … we want to make sure that it is going to be successful and it’s going to be there for the long haul.”

Ferry service between Portland and Yarmouth started in 1970, when the Prince of Fundy began operating. The Scotia Prince ran from 1982 until 2005, when a dispute over mold at Portland’s International Marine Terminal and declining ridership prompted the company to stop the service.

The 485-foot Scotia Prince held 1,200 passengers and promoted itself as a leisurely cruise experience, with cabins, casino games and live musical shows. A one-way trip took about 11 hours.

The Cat, which held about 775 passengers, picked up the service from 2006 to 2009. It made the trip in about 5½ hours and offered aircraft-style lounge seats, four movie screens, slot machines, a cafe and a duty-free shop.

A draft of the request for proposals notes that 70 million people live within a day’s drive of Portland and 30 million live within a six-hour drive.

“The northeast United States offers an enormous potential market for ferry passengers,” the request says.

The draft asks bidders to identify the biggest risks to a self-sustaining operation and how they would address them. The type of ferry service isn’t specified, but the panel of experts recommended Portland as a destination because it presents the best opportunity for a cruise-style — rather than a high-speed — ferry service.

Since ferry service ended, Portland has grown as a cruise ship destination. This year, the city hosted 59 ships with a total of 68,773 passengers. In 2011, 56 ships came, carrying 85,508 passengers, according to the Port of Portland.

Jeff Monroe, a port and transportation consultant with HDR in Boston, said he was been working with two operators that are interested in bidding for the ferry service — one from Italy and one from North America.

Monroe said his studies have shown that the most profitable service would be an overnight, cruise-style ferry with a 24-hour turnaround.

He said he is optimistic that the service will be restored by 2014, if the port in Yarmouth is upgraded and operators can find a year-round use for their vessel.

“I think it has a real good chance of occurring,” said Monroe, who is Portland’s former transportation director.

Bay Ferries is considering whether to submit a bid, said Donald Cormier, the company’s vice president of operations and safety.

Cormier wouldn’t speculate about the type of ferry service, nor would he say why the company, which operated The Cat at a loss, is interested in giving it another shot.

“Until we see exactly what they want, at that point, we will evaluate whether our company will continue to participate,” said Cormier, noting that the company would have to ensure profitability for its shareholders.

The Nova Scotia-based Chronicle Herald reported Wednesday that the United Kingdom’s P&O Ferries, which has one of the biggest passenger and freight fleets in Europe, has also expressed interest in operating the ferry.

The newspaper reported that the service could be running as soon as next year, though officials said a 2014 start is more likely.

Monroe said Maine must view the ferry service as part of its transportation system, rather than simply leaving it to Nova Scotia.

Portland City Manager Mark Rees said the city isn’t in a position to provide financial incentives for a new ferry service, but stands ready to provide technical assistance.

He said the city has made significant investments to its waterfront in recent years, building the Ocean Gateway Terminal and a new facility at the International Marine Terminal.

Paris, Nova Scotia’s minister of economic and rural development and tourism, said the province would welcome support from all levels of government in the United States and Canada.

“It would be nice to see the state of Maine with some skin in the game,” Paris said.

Nova Scotia is expected to call for new elections in the spring, likely adding political pressure for candidates to restart the ferry service, which is seen as vital to the future of southwestern Nova Scotia.

The time line for potential operators to submit their proposals had not been finalized as of Wednesday.

 

Staff Writer Randy Billings can be contacted at 791-6346 or at:

rbillings@mainetoday.com

Twitter: @randybillings