Thursday, May 13, 2010

Portland Port Approves $68 Million Terminal Lease

The Port of Portland governing board voted unanimously Wednesday to approve a nearly $70 million 25-year terminal lease with Manila-based International Container Terminal Services, Inc.

Under the terms of the deal, ICTS will lease the port's T6 container terminal for a first year rent of $8 million and subsequent annual rent of $4.5 million.

In approving the deal, the Portland port board sidelined complaints from New Jersey-based Ports America, the firm currently operating the terminal, that there was no competitive bidding process for the contract.

In 2008, ICTS, Ports America, and others entered bids for a 50-year T6 terminal contract, however as the global economic meltdown accelerated, the port canceled the bidding process.

In 2009, ICTS approached port officials and entered into confidential negotiations on the contract that was approved Wednesday.

The port board said in making their decision that they were confident the port operated legally in the process.

ICTS officials told the Oregonian newspaper that the firm has a five-year plan to double the volume of the T6 terminal, which includes steps such as recruiting smaller niche cargo carriers from Central and South America. The 192-acre T6 terminal handled 210,000 TEUs in 2009 and port estimates suggest the terminal could handle a maximum of 700,000 TEUs a year.

This is the first United States venture for ICTS and it has formed an Oregon-based local subsidiary, ICTSI Oregon Inc., to manage the T6 terminal.

The deal must now receive approval from both the Federal Maritime Commission and clear a national security review by the Committee on Foreign Investment in the United States.