Friday, January 17, 2014

Port of Grays Harbor Sets Volume Records

By Mark Edward Nero

Increasing log exports and roll-on/roll-off cargoes, combined with short sea shipments from Mexico resulted in 102 ship calls to Port of Grays Harbor marine terminals in 2013. The diverse shipping activity added up to a 30-year record for longshore activity.

More than 87,000 Chrysler automobiles were processed for export at the port by Pasha Automotive Services last year, a 23 percent increase over 2012, according to port data. Pasha completed construction of a $3.5 million processing facility in August 2013.

Pasha Stevedoring and Terminals also handled a record 13,609 metric tons of over-high, over-wide equipment for export. Export logs also hit a 15-year high for a combined total of 52.9 million board feet being shipped by customers Alcan and Dkoram, according to data.

During its first full year of operation in 2013, the AGP Storage and Export Facility saw a record amount of agriculture products exported through the facility. Over 1.3 million metric tons of soybeans, soybean meal, beet pulp pellets and dried distillers grains with solubles were exported to Pacific Rim markets last year.

“We were very excited to see the final activity numbers for 2013,” Port Commission President Stan Pinnick said. “Our partners have done an outstanding job bringing business and employment to Grays Harbor.”

Despite the volume highs, however, Deputy Executive Director Leonard Barnes said there’s still room for development.

“We have plenty of space and berth availability to meet demand as we continue to grow. We fully expect to see records set again in the years to come,” he said. “We look forward to more vessel calls and expanding the diversity of cargoes we handle.”

POLA Monthly Container Volumes Up 11 Percent

By Mark Edward Nero

Cargo volumes at the Port of Los Angeles were up over 11 percent in December 2013 compared to the same month in 2012, according to newly released data. The port attributes the increase in part to shippers moving cargo in advance of the Chinese New Year, which falls on Jan. 31.

Imports increased 8.63 percent, from 296,874 TEUs in December 2012 to 322,500 TEUs last month. Exports jumped 16.85 percent, from 147,417 TEUs in December 2012 to 172,261 TEUs in December 2013.

Combined, total loaded imports and exports last month were up 11.36 percent, rising from 444,291 TEUs last December to 494,761 TEUs in December 2013. Factoring in empties, which increased 10.24 percent year over year, overall December 2013’s total volume of 653,358 TEUs was a jump of 11.09 percent compared to December 2012’s 588,154 TEUs.

For calendar year 2013, LA’s total container volume was 7.86 million TEUs, a drop of 2.59 percent compared to 2012’s 8.07 million containers. For the current fiscal year, which began July 1, POLA terminals have moved 4.15 million TEUs, a 2.2 increase from the same six-month period during the previous fiscal year.

Current and past data container counts for the Port of Los Angeles can be seen at

Port of Oakland Hires New Maritime Director

By Mark Edward Nero

The Port of Oakland has selected maritime industry veteran John C. Driscoll to become the port’s new Director of Maritime. Driscoll, who most recently was Vice President of Export Sales for container shipping group CMA CGM, begins his new job at the port on Jan. 27.

As Director of Maritime, Driscoll will be responsible for building and growing maritime business. He’ll also oversee the full range of maritime operations including administration, finance, customer service, planning and development, and seaport security.

“We are positioned to expand our maritime business and we are fortunate to have John, a proven leader in the industry, join our senior management team at this time of tremendous opportunity,” port Executive Director Chris Lytle said. “John’s private sector experience in maritime operations, marketing and sales will help us grow our business.”

Driscoll has over 30 years of commercial practice in international maritime transportation, having worked for Sea-Land Service, Maersk Line and CMA CGM. He had worked in an executive capacity with CMA CGM since 2005, and led the expansion and development of the company’s interests in the Caribbean, Central America and Northern South America. In 2008, he was promoted to Senior Vice President where he oversaw sales, trade, and marketing for the company’s US operations.
Driscoll, a native of Bethesda, Maryland, began his career with Sea-Land Service in 1980.

Port of Long Beach Appoints Environmental Director

By Mark Edward Nero

The Long Beach Board of Harbor Commissioners on Jan. 13 voted to officially promote former Director of Environmental Planning Rick Cameron to the position of Managing Director of Environmental Affairs and Planning, effective Jan. 25.

Cameron had been serving as Acting Managing Director of Environmental Affairs and Planning since July 2013, when then-Managing Director Bob Kanter retired. Cameron had been the port’s Director of Environmental Planning since 2007; he originally joined the port in 1996 as an environmental specialist.

“Rick Cameron has been very instrumental in designing and building the signature programs that have made the Port of Long Beach a leader in environmental stewardship,” Harbor Commission President Doug Drummond said. “He’s the right choice.”

In his new role, Cameron will oversee a bureau that includes 41 jobs in the Environmental Planning, Transportation Planning and Master Planning divisions. Long Beach’s Environmental Affairs and Planning Bureau is tasked with improving the environment in and around the port and is responsible for analyzing proposed construction, obtaining funding for transportation improvements, studying job creation and economic impacts and advancing clean technologies.

The bureau also coordinates programs to improve air, water and soil quality, preserve wildlife habitat and integrate sustainability into port practices.

Tuesday, January 14, 2014

Regional Report: Infrastructure Upgrades Abound at LA and Long Beach

By Mark Edward Nero

It’s very true that a seaport's location can play a significant role in how successful the port is and could become. However, another very important factor in that success is the level of quality infrastructure in and around the port.

The condition and status of roads, bridges, rail yards, container terminals and shipping berths on or near port property can play a huge role in the efficient movement of goods in and out of an area.

This fact is quite well known by the operators and overseers of the ports of Los Angeles and Long Beach in Southern California's San Pedro Bay. Throughout 2013, both ports were engaged in multiple projects to upgrade and strengthen their respective substructures. From berth upgrades, to terminal renovations, to improvements to bridges, roadways and rail, the adjoining ports were in the midst of infrastructure improvements throughout the year.

Punctuating the point that infrastructure improvement means a lot to the two ports, the current fiscal year for each is the first time in history that their capital budgets have topped $1 billion combined.
Last June, the Port of Los Angeles adopted a 2013-14 fiscal year budget of about $1.1 billion, with almost $400 million – or 37 percent of the total budget – allotted for capital improvement.

"Our fiscal year of July 1, 2013 to June 30, 2014 is the largest capital budget in our history, a $399 million capital budget that will break all our records in terms of total capital spending," Port of Los Angeles Deputy Executive Director of Development Mike Christensen told Pacific Maritime Magazine.

Days after the POLA approved its budget, Long Beach also approved a $1 billion financial plan for its upcoming fiscal year. The budget includes the largest capital improvement spending plan ever adopted by the port: $788 million.

The capital spending total is six percent more than FY 2013. The port's modernization projects, including its Middle Harbor terminal project and replacement of the Gerald Desmond Bridge, pushed the overall budget up by 6.6 percent compared to the previous fiscal year.

One infrastructure project that both ports worked on for years that finally reached its apex in 2013 was the installation of alternative maritime power (AMP), also known as cold ironing, at container berths throughout various terminals.

The AMP installations mean that ships at berth are now able to receive electrical power from the shore while the ships' engines are off. The berth electrifications came just before a state deadline requiring certain California ports to ensure that at least half of all visits by container cargo, refrigerated cargo and cruise vessels be powered by electricity.

Under the rule, which went into effect Jan. 1, 2014, vessels must sometimes shut down their diesel engines and run on shore-side electricity while at the ports of Los Angeles, Long Beach, Oakland, San Diego, San Francisco and Hueneme.

The rule, which applies to fleets making at least 25 visits per year to California ports, was approved by the California Air Resources Board in December 2007.

The port has a total of roughly 100 berths, but many aren't container or cruise berths and are therefore exempt from the rule. That said, over the course of the past few years, the Port of LA went from having nine AMPed berths to having 26 by the end of 2013.

"Those 26 berths will be more than any other port in the world," port spokesman Phillip Sanfield said.
"We will have spent more than $180 million accomplishing this," Christensen said.

The Port of Long Beach also put a significant amount of money into AMP power.

"We've recently finished up about $175 million worth of infrastructure for the shore power regulation that starts Jan. 1," revealed Dr. Noel Hacegaba, Acting Deputy Executive Director for the Port of Long Beach.

By the end of 2013, all 13 international cargo terminals at the San Pedro Bay port complex had at least one berth that can deliver shore power to ships.

Also among the more important projects taking place on the LA side of the harbor throughout the year was continued construction of the $137 million rail project at Berth 200, also known as the West Basin Railyard.

The intermodal storage rail yard is designed to provide staging and storage for trains using the 20-mile Alameda Corridor railroad express line. When complete in the spring of 2014, it is expected to improve a vital link in the national freight network.

The project will also enable track space at the TraPac container terminal to serve as TraPac's future on-dock rail facility. About $365 million in rail, roadway and terminal improvements are being completed over the next few years at TraPac, which is currently the only Los Angeles terminal without on-dock rail.

The project is being built in two phases: Phase I, which began in 2012, includes construction of the new yard, support tracks for the TraPac and China Shipping/West Basin Container terminals, double-track connections to the Alameda Corridor and national rail network and access road improvements. 

Phase II, which began construction later in 2013, includes final rail network connections and vehicle overpasses to eliminate at-grade crossings for safer, more efficient flow of truck and commuter traffic. Both phases are due to be completed by late spring or summer 2014.

"It remains one of our most important terminal expansion programs for several reasons," Christensen said of the project. "TraPac is a $510 million expansion program that will be the first automated container terminal at the Port of Los Angeles. We began construction on the automated portions of the terminal back in 2012. The first elements of automation continue under construction this year."

At an LA Harbor board meeting last November, the commission formally approved the contracts for the largest portion of the automated terminal to go into construction.

"It's what I'd call a hybrid terminal," Christensen said of TraPac. "It's basically a three berth terminal; two of those three berths will be fully automated. The third berth will remain conventional."
Also part of the TraPac project is a new rail yard.

"This will be the first rail yard we'll open that will be an automated, on dock container rail yard," Christensen said.

The ports' infrastructure upgrades are being made in part to fend off competition from other areas aiming to steal business from LA/Long Beach, such as the Panama Canal and Canada's Port of Prince Rupert, both of which have undergone well publicized infrastructure upgrades in order to attract more containerized cargo.

But the LA and Long Beach upgrades are also being made so that the ports can better compete against a closer competitor: each other. Although some outside the region look at LA-Long Beach as one big sprawling complex, and although they do collaborate in some instances, such as on anti-pollution initiatives, in actuality the two sides are highly competitive with one another, something that keeps each striving to gain a competitive advantage.

One area where the two entities butted heads in 2013 was the development of the $500 million, 153-acre Southern California International Gateway project. The SCIG is a planned near-dock rail container transfer facility proposed by Burlington Northern Santa Fe Railway for use on land owned by the City of Los Angeles Harbor Dept., as well as on adjacent private land in Los Angeles, west Long Beach and Carson.

The project was approved by the Harbor Commission in March and the LA City Council in May, but in June, the City of Long Beach, the Natural Resources Defense Council, South Coast Air Quality Management District and Long Beach Unified School District all submitted anti-SCIG lawsuits in Los Angeles Superior Court, alleging that the Port of Los Angeles didn't conduct a full and thorough environmental review before approving the project.

Long Beach's suit contends that the SCIG project would adversely affect its residents, businesses and schools by bringing more noise and air pollution to an area that has already suffered plenty over the years due to nearby port-related operations.

"The Port of Long Beach is a department of the City of Long Beach, and so our position is consistent with that of the city," Hacegaba told Pacific Maritime Magazine.

Due to the litigation, construction, which was supposed to begin in 2013 and completed about three years later, has been put on hold indefinitely.

"We're now we're slogging through the additional portions of litigation," Christensen said. "It remains a very important project to us and to the BNSF Railway, the project's sponsor. It's awfully hard to estimate the time it'll be tied up in litigation. That's about all we can say at this point."

The conflict is a rare example of the two sides openly being in direct conflict with one another; usually projects one side undertakes affect the other side more indirectly, such as the building of a new bridge on the Port of Long Beach side to replace the aging Gerald Desmond Bridge.

The $1 billion Desmond Bridge project consists of replacement of the obsolete structure with a new state-of-the-art span. A groundbreaking for construction of the new bridge took place in January of 2013, and the new, as yet unnamed structure is expected to be finished in 2016. The new bridge would be higher from the water and have more traffic lanes than the existing 45-year-old Gerald Desmond Bridge, which sits adjacent to the under construction span.

"It's important for the public to know that we're investing billions of dollars into our infrastructure at a time when the global competitive landscape is changing and it's important to note that we're doing this to position our port to be the most competitive in North America," Hacegaba said. "What we're trying to do is make sure we're big-ship ready."

The existing bridge's height of 155 feet restricts newer, larger ships from reaching piers within the inner channels, but the new bridge is expected to raise the clearance over the port's inner harbor channel to 205 feet, giving it the tallest span height for a cable-stayed bridge in the US.

"The new bridge will be an icon in the Long Beach skyline," Hacegaba predicted.

"Not only is the new bridge going to be taller to accommodate the larger vessels that will have to pass underneath it, but it will also be wider, so it will certainly positively affect the commuter traffic," he said. "So for the trucks and commuters that drive over the bridge, we'll be able to accommodate the traffic flow so that you don't get as much congestion."

Separate, but related to the Desmond Bridge project is the replacement of the 65-year-old Commodore Schuyler F. Heim Bridge, a vertical lift bridge that lies partially within both the Los Angeles and Long Beach city limits, due north of the San Pedro Bay port complex.

For the $351 million Heim Bridge project, which began in 2011 and is expected to be complete in 2017, the California Dept. of Transportation determined it would be more cost effective to replace the structure than attempt to retrofit the bridge. Therefore, the lift-span portion of the existing Heim Bridge is being replaced by a fixed-span bridge structure, which means the new span that expands over the navigation channel will permanently be attached to the support beams, as opposed to being able to move and lift upward.

Caltrans says the new bridge, which like its predecessor is expected to see heavy truck traffic, will provide a permanent navigable channel that's 180 feet wide, with a vertical clearance of 47 feet, as opposed to the current bridge's 38 feet.

Perhaps most importantly, with the elimination of the lift, traffic over the six-lane span won't be delayed due to passing ships.

One of the more interesting things about all the upgrades and improvements that port facilities are undergoing is that neither port had to implement a planned infrastructure fee to get the funding for them.
A few months ago, both ports repealed approved never-implemented cargo fees that would have been used to help finance major rail, highway and bridge improvement projects.

The infrastructure cargo fee (ICF), which would have varied from $6 to $18 per 20-foot equivalent container unit, would have been assessed on all loaded containers entering and leaving the port by truck or rail.

The fee was formally revoked by the Los Angeles Board of Harbor Commissioners Sept. 19 and by the Long Beach board two months later.

The fees had been expected to begin in 2009 and raise $1.4 billion in order to secure matching state transportation funds for the design and construction of 17 specific highway and rail construction projects throughout the harbor district.

But when the economy began to slide into a deep recession, both ports decided to put the customer first and shelved their versions of the ICF while pursuing other federal, state and regional grants to advance their projects.

Over time, the ports managed to find other revenue sources to secure the majority of the funds needed to pay for multiple capital projects now being built or due to begin construction in early 2014.

Port of Vancouver Wins Terminal Lawsuit

By Mark Edward Nero

A Superior Court Judge on Jan. 10 ruled against three environmental groups that have been trying to stop the Port of Vancouver, Washington from moving forward with a proposed 42-acre oil-handling terminal.

The three groups – Columbia Riverkeeper, the Northwest Environmental Defense Center and the Sierra Club – sued in October 2013 to stop the project, maintaining that its 10-year, $45 million lease was approved before an environmental study had been conducted.

Judge David Gregerson dismissed the claim, but also said the environmental groups are still allowed to continue pursuing a separate complaint, which alleges that the port violated the Washington state open meetings laws by conducting a “secret” meeting to discuss the lease last July 22.

Gregerson’s decision against the environmental groups is eligible to be appealed, but on the day of the ruling, Columbia Riverkeeper Executive Director Brett VandenHeuvel would not comment on whether the groups would appeal the decision. The port’s legal representative, however, said Vancouver intends to adhere to the stipulation regarding the July 22 executive session conducted by the Commission.

“We understand the court’s desire to allow the plaintiffs time to pursue limited additional evidence,” port attorney Lawson Fite of the Markowitz, Herbold, Glade & Mehlhaf firm, said. “We intend to work with the plaintiffs to provide the necessary information in an efficient manner.”

The project in question is a joint proposal by petroleum products company Tesoro Corp. and supply chain solutions business Savage Companies, a to develop and operate a new 120,000 barrel-per-day (bpd) crude-by-rail unloading and marine loading facility at the Port of Vancouver.

The Tesoro-Savage joint venture would own the crude unloading and marine loading facilities and enter into a land lease agreement with the port for an initial 10-year period. Savage would oversee and manage the design, construction and operation of the facility on the joint venture’s behalf.

The deal, which was approved by the Port of Vancouver Board of Commissioners last October, is still subject to approval by state regulatory agencies.

“The port will continue to work collaboratively with the environmental community and other stakeholders as the Tesoro-Savage project is reviewed,” port Executive Director Todd Coleman said in a statement.

Maersk Line Creating New Americas Division

By Mark Edward Nero

Ocean transport company Maersk Line announced Jan. 8 that it’s forming a regional, containerized shipping company called SeaLand that will be dedicated to the intra-Americas market.

“We heard from our customers that they value Maersk Line services but they required greater service stability and commitment. That’s one of the key reasons why we’re responding with an improved, restructured solution for the Intra-Americas,” SeaLand’s newly named CEO, Craig Mygatt, explained.

The new, independent unit is expected to officially commence operations Jan. 1, 2015 and have a structure similar to Maersk’s other regional carriers: intra-Asia’s MCC Transport and intra-Europe carrier Seago Line. Maersk says the new company will have local sales and support personnel positioned in North, Central, and South America, as well as the Caribbean, but will be based at a to-be-determined located in the United States.

Maersk says it will begin the transition of its Intra-Americas business to SeaLand in a phased approach throughout 2014 and that the newly established team of about 240 personnel will begin their new roles by July 1 of this year.

Despite its independence, the company’s expected to share specific Maersk Line operational services, such as finance and land-side operations.

“This reorganization is an investment in our global container business,” Maersk Line Chief Trade & Marketing Officer Vincent Clerc said. “It enhances and strengthens service in this important and growing trade region, as well as the future of our overall global service network.”

Port Metro Vancouver Selects Patrol Vessel Supplier

By Mark Edward Nero

British Columbia-based company Daigle Welding & Marine has won a contract to build two new harbor patrol vessels for Port Metro Vancouver, the Port said Jan. 10. The vessels are currently under construction.

Metro Vancouver said Daigle was selected through an open-bidding process to design and construct the new patrol vessels, which are needed to support growth at the port due to increased trade through the Asia-Pacific Gateway.

The vessels’ purpose, according to the port, is to provide “continuous marine surveillance” with “early incident detection and activity tracking.”

The new vessels, which are already under construction in the Vancouver Island city of Campbell River, will have parts from a number of local suppliers, including North Vancouver’s Jastram Engineering Ltd., and Osborne Propellers. Jastram Engineering Ltd. will provide the complete steering gear and control system, which utilizes Digital Control Amplifier (DCA 100) and Digital Helm unit (DH 36) technology, providing the new vessels with precise power steering control that automatically switches over to manual hydraulic control in the event of a failure.

Osborne Propellers will provide semi-custom designed propellers specifically modified for heavier leading and trailing edges.

“This is an exciting day for Campbell River,” Peter Xotta, Port Metro Vancouver’s Vice President of Planning & Operations, said. “I grew up here and it’s great to see a local company building these vessels for Port Metro Vancouver.”

The new vessels are also expected to be powered by engines with advanced combustion systems, including the capability to run bio-diesel, to minimize particulate and greenhouse gas emissions, according Daigle.

The port says the two patrol vessels are expected to enter service in May of this year.

Removed Port Angeles Board President Regains Role

By Mark Edward Nero

Jim Hallett, who was removed as president of the Port of Port Angeles Board of Commissioners last August in the wake of controversy surrounding the resignation of former port Executive Director Jeff Robb, has reassumed his previous role.

On Jan. 13, commissioner John Calhoun, who had been serving as president, joined with newly sworn in commissioner Colleen McAleer and voted to elect Hallett president of the three-person board.

Hallett had been removed as president by unanimous vote last August after a rift between board members that opened as a result of the situation surrounding Robb who, citing what he called “serious health issues,” resigned as executive director of the Port of Port Angeles last June.

Robb was immediately hired by the port commission at the same salary to fill a newly created job – environmental affairs director – but the vote was 2-1, with Hallett against. Hallett later said he was unhappy with the way the situation was handled and that other candidates should have been interviewed for the previously unannounced position.

At the Aug. 26 meeting, Hallett’s board colleagues said his stance on the controversy had compromised his effectiveness. Ultimately, both Hallett and commissioner Paul McHugh agreed with the assessment and Hallett yielded his seat as president to Calhoun.

McHugh, who was up for re-election, did not pass the primary stage and his seat was eventually won in November by McAleer, the first female board member in the port’s 90-year history.

McAleer, who won with better than 64 percent of the more than 13,300 votes cast, already worked for the Port of Port Angeles as its director of business development, a position she resigned when taking her seat on the board.

In July, she identified herself as the whistleblower who filed the complaint that launched an investigation into Robb’s resignation and immediate rehiring. Robb now says he intends to retire in July.