Thursday, December 5, 2013

Keep Washington's Terminals Open for Business

The King County Council will be considering a resolution (Proposed Substitute Motion No. 2013-0386.2) on Monday, December 9 that would condemn two proposed bulk export terminals in Bellingham and Longview, endangering billions of dollars in new trade investment in Washington.

The Washington State Chapter of Americans for Prosperity urges all those in the Washington State maritime industry to contact these King County Councilmembers:
Jane Hague (206-477-1006)
Kathy Lambert (206-477-1003)
Peter von Reichbauer (206-477-1007)

Tell them that you support the terminals and the trade through Washington State!

New Long Beach Harbor Commissioner Confirmed

On an 8-0 vote, the Long Beach, California City Council on Dec. 3 confirmed Lori Ann Farrell as the newest member of the Long Beach Board of Harbor Commissioners. She takes the place of recently resigned commissioner Nick Sramek.

“I’m truly humbled by the opportunity,” Farrell said upon voted to the board.

Her confirmation now means there’s one open seat on the five-member panel, which oversees the Port of Long Beach. The lone vacancy is that of the seat formerly held by Thomas Fields, who was removed by the Council by a 6-3 vote on Nov. 19.

Fields, a Long Beach advertising executive and former city planning commissioner, was appointed to a six-year term on the Board by Mayor Bob Foster in December 2009, but it was Foster who, after a series of disagreements, recommended his removal last month.

Farrell has been the director of finance for the City of Huntington Beach since December 2010. Before that, she spent three years as Long Beach’s Chief Financial Officer, and was the city’s Controller from 2006-2008.

She previously worked for Morgan Stanley Smith Barney as a financial advisor, and also in financial roles for the city and state of New York.

Sramek, the man she replaces on the Harbor Board, spent nearly six-and-a-half years on the panel before resigning Nov. 21, citing fatigue.

The search is still on for someone to fill the remaining 18 months of Fields’ term; the mayor has said he hopes to nominate a candidate by the end of the year.

Bellingham Port Approves Waterfront Redevelopment Plans

The Bellingham, Washington City Council and Port of Bellingham Commissioners this week moved a big step toward redevelopment of the city’s waterfront by adopting a package of master planning and development agreements for the Waterfront District.

The City Council approved the Waterfront District master plan and associated documents on Mon., Dec. 2, and the Port Commission did the same on Tues., Dec. 3. The approved documents include a master plan, development regulations, development agreements, planned action ordinance and a facilities agreement that describes the investments the port and city are making in the 237-acre waterfront site.

“I am ready to move forward and I believe the entire community is ready to move from planning the waterfront redevelopment to actually doing it,” Port Commission President Jim Jorgensen said.

Although environmental cleanup projects, demolition and site preparation have been underway for years, the approval sets the stage for redevelopment work to begin, including design and construction of early roads, parks and trails, as well as selection of developers to begin making investments in the property.

“Our goal is to find developers who share the community’s vision for the waterfront and who have the ability to be long-term partners in this important development,” port Executive Director Rob Fix said.

These redevelopment plans underwent a decade of public participation and planning that began in January 2003, when the port and city established the citizen-led Waterfront Futures Group. The group spent more than a year guiding a visioning process for the 11 miles of Bellingham Bay shoreline within the city limits.

“This plan will transform an isolated and contaminated site into a vibrant and thriving place that is restored and accessible,” Bellingham City Council President Seth Fleetwood said.

Foss, ASRC Launch Joint Alaska Venture

Tug and barge operator Foss Maritime and offshore spill response company ASRC Energy Services Response Operations have formed a joint venture to together pursue marine services opportunities throughout Alaska.

The joint venture, called AES-Foss Marine, was revealed Dec. 3. It will provide marine services throughout the state, and is expected to be headquartered in Anchorage.

“For mariners, Alaska represents challenges beyond those found in the Lower 48, but it also presents great opportunities," Foss Maritime Global Services President Gary Faber said. “Foss is positioned to be part of these projects with our decades of experience in Alaskan waters and our significant investments in state-of-the-art vessels and equipment.”

ASRC Energy Services Response Operations, a subsidiary of oil and gas service company ASRC Energy Services, offers a variety of spill response services. It’s an indirect subsidiary of the Arctic Slope Regional Corp (ASRC).

ASRC has five distinct businesses in several sectors, including energy and oilfield services. The corporation holds title to about five million acres of land on the North Slope that have either known resources or are highly prospective for oil, gas, coal and base metal sulfides.

“We strive to partner with companies that believe in responsible development and will protect our resources through safety and environmental stewardship. And in that regard, Foss certainly is a maritime industry leader,” ASRC Energy Services President and CEO Jeff Kinneeveauk said in a statement.

Engineer Arrested for Stealing Shipbuilding Secrets

Canadian authorities on Dec. 1 arrested a naturalized citizen for allegedly trying to sell national shipbuilding secrets to China.

The arrested man, Qing Quentin Huang, is a Toronto resident employed by Lloyd’s Register Canada. The company is a subcontractor to Irving Shipbuilding, whose projects include the Arctic Offshore Patrol Ship project, a vessel procurement plan for the Royal Canadian Navy.

In a statement, the Royal Canadian Mounted Police said it was notified Nov. 28 that Huang was “taking steps to pass sensitive information” to authorities from the People’s Republic of China.
The information allegedly relates to elements of the Government of Canada National Shipbuilding Procurement Strategy, which includes patrol ships, frigates, naval auxiliary vessels, science research vessels and icebreakers.

“In these types of cases, sharing of information may give a foreign entity a tactical, military or competitive advantage by knowing the specifications of vessels responsible for defending Canadian waters and Canadian sovereignty,” RCMP Chief Superintendent Jennifer Strachan said.

The RCMP said that after it was informed of Huang’s actions, it initiated a criminal investigation dubbed Project Seascape.

In a statement released the day of the arrest, Irving Shipbuilding President Kevin McCoy said Huang didn’t have direct access to any classified or controlled information relating to vessels built as part of the Arctic Offshore Patrol Ship project.

“Security of information surrounding the AOPS project, and all NSPS programs is tightly controlled at Irving Shipbuilding,” McCoy said. “We adhere to all security protocols required by our customers.”

Huang, who has been suspended without pay, was one of 20 marine engineers at Lloyd’s Register’s Burlington, Ontario location since April 2006. His was a structural design appraisal engineer tasked with assessing ship designs for compliance with industry standards.

Tuesday, December 3, 2013

December 2013 Fidley Watch:
Maritime Economic Impact Study

With the recent revelation that the federal government has been falsifying employment numbers for political gain, it becomes even more incumbent on the private sector to provide a dose of reality. Fortunately, reliable data on Washington State’s maritime industry, released late last month, reveals that while the country wrestles with unemployment, the West Coast maritime sector continues to steam along on course with fair winds and following seas.

An economic impact study on the effect of the maritime industry on the State of Washington, commissioned by three Seattle and King County organizations, shows the overwhelming beneficial effects of the maritime industry on the State of Washington’s economy. The Washington State Maritime Cluster Economic Impact Study sought to quantify the impact of the maritime industry in order to better understand and strengthen its contributions to the regional economy.

The study was commissioned by the Economic Development Council of Seattle and King County, the Puget Sound Regional Council and the Workforce Development Council of Seattle and King County, with input from a broad spectrum of maritime industrial businesses – including Philips Publishing Group. The study looks at the direct and indirect impacts the maritime industry has on the local and regional economy.

According to the study, Washington’s maritime cluster employed more than 57,700 people directly in the state last year, and was responsible for $15.2 billion in gross business income. Indirect and induced Maritime jobs account for another 90,000 jobs, for a total impact of 148,000 Washington jobs. The direct contribution of the industry’s $15.2 billion in gross business income generates another $14.8 billion in induced and indirect output, for a total contribution effect of nearly $30 billion to Washington’s economy.

Here are some of the study’s other findings:

The maritime industry paid nearly $4 billion in wages in 2012 with average salaries of $70,800. In comparison, the state’s median wage is $51,000.

Every direct job in the maritime industry supports 1.6 jobs elsewhere in the economy. And for every $1 million in sales, another 10 jobs are supported elsewhere in the economy.

Industry-wide, revenues have grown 6.4% per year on average with the largest growth rate in Maritime Logistics and Shipping, at a robust 10.2%.

Go to to download the report.

The Washington State Maritime Study is the most recent in a series of developments that give us hope our new governor is more aware of the importance of our maritime economy than was his predecessor. Governor Inslee’s appointment of Steve Sewell to the newly created position of director of maritime gives us a champion at the upper levels of the administration for the first time.

Having served as seaport director for the Port of Seattle, and in various management capacities and PB Ports and Marine, Mr. Sewell is a knowledgeable and articulate advocate for the maritime industry. We wish him well in his new role!

At our recent eNavigation Conference in Seattle, Mr. Sewell and the authors of the maritime study were seen talking to maritime policymakers representing Oregon and California. It’s a safe bet that the good news we’ve quantified scientifically in Washington can be extrapolated along the West Coast, whose independent maritime sectors are encouraged to commission their own economic impact analyses.

Port of Oakland Truckers Picket SSA

About 25 percent of the drayage truck drivers serving the Port of Oakland conducted a work stoppage on Nov. 27, and the resulting protests led to both arrests and decreased productivity at multiple terminals.

Members of the Port of Oakland Truckers Association, a self-organized group of truck owner-operators, set up pickets at the port’s four SSA terminal gates beginning at 5 am on Nov. 27 and picket lines later began shifting between various gates. By 10:30 am, six people were detained for creating a hazard in a roadway, but were merely cited and released.

According to the Truckers Association, SSA truck traffic was down 90 percent during the first morning of the protest, however the port itself says there were no major disruptions in operations.

“Normally, at this time of day the SSA gate has lines of trucks going all the way down the street in both directions, with trucks waiting in the center lanes as well. Today the lines were very short and mostly outside drivers,” truck driver Jose Gomez said. “It’s important because SSA has a lot of ships coming in today and they are not going to be able to get trucks to take the loads.”

Truckers Association members voted unanimously Nov. 22 to stop work at the port on Wed., Nov. 27. Truckers Association representatives have been pushing for an extension of the California Air Resources Board-enforced deadline of Jan. 1 to acquire trucks built in 2007 or later in order to continue working at the port.

Under the regs, trucks built before 2007 can continue to operate at the port only if they undergo significant retrofitting, estimated about $80,000 per truck.

The Association has also asked for grant funding to help about 800 truckers offset the financial burden of costly truck upgrades required by the law. Those 800 drivers, according to the Truckers Association, will essentially lose their jobs once the regulations go into effect, since they won’t be able to work at the port.

The majority of truckers have already bought new trucks at a cost of between $50,000 and $80,000, and many are applying for microloans to pay loan payments on upgraded trucks just to keep working, according to the POTA. Because of this, the Truckers Association has also demanded that a green emissions fee – a tariff on each container, imposed on terminals by the Port of Oakland – be paid to truckers to offset the costs of meeting state regulations.

The truckers also seek a “congestion fee” of $50 per hour after the first two hours truckers spend waiting in line to pick up a load, to compensate them for work that is currently unpaid and to encourage terminal efficiency. They are also asking for a per-load rate increase.

The Truckers Association has said it is “unclear” whether the Nov. 27 protest was a one-day event, or if they plan to conduct similar actions in the future.

Olympia Port Begins First Dredging Project in More Than 30 Years

Maintenance dredging of the marine terminal vessel berths and the Swantown Boatworks haulout area began at the Port of Olympia in late November and is expected to continue for several weeks.

The port is dredging the 20-foot area adjacent to the marine terminal pier to its authorized depth of minus 42 feet. The port is also dredging areas waterward of the 20-foot strip that are higher than minus 38 feet. The dredge is also expected to remove contaminated sediments from Budd Inlet.

According to the port, it has been more than 30 years since the Budd Inlet areas were dredged, and over time, silt has built up and decreased water depths, causing safety issues for workers and limiting the number of ships the port can safely berth.

“The increased water depths will help ensure safe services to the marine terminal’s international customers and allow Swantown Boatworks to fully serve its local and regional customers,” the port’s environmental programs director, Alexandra Smith, said. “The maintenance dredge also contributes to the removal of contaminated sediments from Budd Inlet.” The project, which has been contracted out to Tacoma-based Orion Marine, is expected to be complete in either January or early February of 2014.

For the marine terminal, the current shallow depths adjacent to the pier mean the ships can’t dock directly at the pier. To move cargo, a device attached to the dock called a “camel” holds the vessel five feet away from the pier. The cargo loading and unloading takes place across the five-foot span, which carries safety risks. The dredge project is expected to remove the safety risks and enable fully loaded ships to utilize all the berths simultaneously. Currently, the port can’t accommodate even two fully loaded vessels at berth.

At low tide, the Boatworks has only eight inches of water depth and therefore must close its haulout facility to customers. The dredge is expected to provide safe depths for the haulout facility and allow it to operate at low tides.

The port says it expects dredging up to 40,000 cubic yards of sediments, with 6,000 cubic yards from the Swantown Boatworks area and the remainder from berths one, two and three. The dredged material will then be transported by truck to an upland disposal facility in Castle Rock, Washington.

Following the removal of the material, a six to nine inch layer of clean sand will cover the exposed berth areas as a safety barrier between the exposed areas and the surface, according to Smith.

Tons of Invasive Plant Removed from Stockton Channel

Roughly 187 tons of an invasive species of plant called the water hyacinth has been removed from the Port of Stockton’s deep water channel since early November in hopes of clearing the channel for better navigation by oceangoing vessels.

Water hyacinth plants have tremendous growth and reproductive rates; a single plant can produce as many as 5,000 seeds. The plant, which grows from March to December, can double in size roughly every 10 days during warm weather months.

In 2012, Stockton struggled significantly with the plant’s growth to the point that ships wouldn’t navigate the deep-water channel after dark because the fields of plants were so thick that they resembled land and caused confusion.

Spraying of the plants began early this year, but the results failed to halt the problem, so the port eventually set aside $25,000 to hire Aquatic Harvesting, which is based in the Northern California city of Hayward, to harvest the plants.

Under the process, Aquatic Harvesting uses harvesting machines to pull the plants out of the water and onto boats, where they’re then brought to land, placed in containers and taken to a port-based waste management company called Recology, which then dries the plants and grinds them up.

Olympia Wins Port of Year Award

The Port of Olympia, which has seen sizable growth in revenue and ship calls throughout this year, was named the Washington Public Ports Association’s 2013 Port of the Year during WPPA’s annual meeting in Tacoma on Nov. 22.

The port’s 2013 revenues are estimated at $12 million, representing a 20 percent increase over 2012 and a 25 percent increase over 2011, all of which were historic highs.

Revenues for the six months ending June 30, 2013 were $6.4 million.

Operating income before depreciation for the six months ending June 30, 2013 was $1.4 million.

For the calendar year 2013, the port estimates it will see a total of 36 vessels and three barges, up significantly from the 15 full vessels and five partially filled vessels it saw during 2012.

Manpower hours were also up significantly during the year. In 2012, longshore workers received a total of 23,002 hours, but that number has risen to 48,262 hours so far this year, according to data.

Olympia operates the largest break-bulk proppant port on the West Coast and the second-largest log export terminal in the Pacific Northwest. Proppant is treated sand or ceramic material used during the process of hydraulic fracturing, commonly known as fracking.

The award is chosen annually by a committee comprised of five port commissioners from the 69 public seaports WPPA represents, and one port director.