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Friday, April 25, 2014

Port of Redwood City Dedicates
$17 Million Wharf

By Mark Edward Nero

A state-of-the-art, $17 million wharf was dedicated and opened by the Port of Redwood City during an April 23 ceremony.

According to the port, the wharf is the first new wharf for cargo ships in the San Francisco Bay Area that meets the latest operational, seismic, and sea level design standards for the wharf structure itself and adjacent shoreline.

The modernized wharf replaced a 60-year old World War II era wooden wharf with a new bulk handling concrete wharf that was designed to meet the present demands for operational and seismic conditions and climate change issues.

Construction began in September 2012 with the demolition of the old wooden wharves and the adjacent warehouse. A 950-foot long seawall designed to meet storm surges and predicted sea level rise was built along the shore of the port, adjacent to the modernized wharf. Additional project improvements include a new 2,100 square-foot longshoreman’s building, upgraded water/electrical utilities, new seismic monitoring equipment, new security fencing and gates, exterior lighting and a parking area.

The wharf, which is connected to the shore by 33-foot-wide concrete ramps, is expected to be used to dock Panamax-sized dry bulk ships.

The new wharf is situated between a Cemex cement marine terminal and a Sims Metals scrap iron terminal. The new portion is about 430 feet long and 60 feet wide, with the two access ramps located at the north and south edges of the wharf.

The project was financed by a $10 million 2012 bond and port capital project reserves, which the port says had been set aside for years in planning for construction of the new wharf.

Hapag-Lloyd, CSAV Sign Merger Agreement

By Mark Edward Nero

German shipping company Hapag-Lloyd AG and Chilean shipper Compañía Sud Americana de Vapores (CSAV) have signed a binding contract to merge CSAV’s entire container business with Hapag-Lloyd, the two container moving businesses have confirmed.

The deal, which was announced April 16, is still subject to the necessary regulatory approvals.

Following the integration, the new Hapag-Lloyd is expected to rank among the four largest liner shipping companies in the world, with 200 vessels with total transport capacity of around one million 20-foot equivalent units, and an annual transport volume of 7.5 million TEU.

The company’s head office is expected to remain in Hamburg, Germany, but Hapag-Lloyd says it will also have a strong regional office in Chile for its Latin America business.

In return for contributing its container business, CSAV is expected to become a new Hapag-Lloyd core shareholder and will initially hold a 30 percent stake in the combined entity.

“I am delighted that we have succeeded in concluding this partnership through which our two companies are playing an active part in consolidating the liner shipping industry. This day is an important milestone in the history of Hapag-Lloyd,” Hapag-Lloyd Executive Board Chairman Michael Behrendt said upon signing the agreement.

CSAV CEO Oscar Hasbún said that by joining forces, the two companies are creating a “stronger, larger and more global company” with significant economies of scale and an improved competitive position.

“The combination with CSAV, Latin America’s leading container shipping line, considerably strengthens Hapag-Lloyd in this growth market and adds a strong position in the North-South traffic to the company’s global network and to its established strength in East-West traffics,” Hasbún said.

Port of Tacoma Container Volumes Rebound

By Mark Edward Nero

After a down month in February, container volumes through the Port of Tacoma bounced back in March, posting a gain of more than eight percent compared with the same month last year, according to newly-released port data.

Port terminals saw a total of 185,415 TEUs during the month, an 8.5 percent increase over March 2013, according to the data. The bulk of the total volume came from imports and exports of full containers from overseas, of which the port saw 120,564.

The increase in volumes was expected after production ramped up in China following factory closures during the Lunar New Year holiday in early February, and empty containers were sent back to Asia ahead of the peak shipping season that traditionally begins in the summer.

Additionally, a strike by container truck drivers at Port Metro Vancouver from March 10 to 26 also diverted some cargo to Tacoma, according to port officials.

In February, container volumes were down five percent compared with the same month last year, dragged down by a 28 percent drop in overseas containers caused in part by the Lunar New Year.

Despite the gains last month, however, Tacoma container volumes were flat for the first quarter of the year: they were down 0.3 percent year to date to 467,789 TEUs. However, full containerized exports improved four percent to 140,290 TEUs during the three-month period, and imports grew nearly three percent to 177,047 TEUs.

Additionally, break bulk cargo volumes and auto imports continued to perform well year to date, up 25 percent and 14 percent respectively, last month.

Tuesday, April 22, 2014

A Corporate Struggle for Russia's Largest Port


By Eugene Gerden


Novorossiysk Commercial Sea Port (NCSP), Russia's largest sea port and one of the largest in Europe may be in the center of a corporate fight between its major shareholders, which may negatively affect its activities and result in the decline of revenue.

So far, the port has been controlled equally by Transneft, a Russian state-controlled business responsible for the national oil pipelines and Summa Group, a diversified private holding, specializing in investment activities in port logistics, engineering, construction, telecommunications and the oil and gas sectors, however both companies have recently announced their plans to split up the business.

Nikolay Tokarev, President of Transneft, said yesterday that Transneft plans to become a sole owner of the port's oil terminals, while Summa Group will focus on the transshipment of dry cargo.

According to Tokarev, in addition to the split, the companies are discussing the division of the spheres of influence, where each company will nominate its deputy general director to oversee each of the directions.

The conflict between the owners of the port began earlier this year. In February Mr. Tokarev, in an interview with Russian business paper Kommersant, sharply criticized its partner for the ways of the port's management. After that, Transneft initiated a change of the port's CEO and its board.

The controlling stake in the port (50.1 percent) is currently owned by Novoport Holding Ltd, which is a joint venture of Transneft and Summa. At the same time Transneft itself holds another 10 percent stake in the port, while the remaining 20 percent is held by the Russian government via the Federal Property Agency.

In the meantime, there is a possibility that the current uncertainty in the port's management could play into the hands of Rosneft and ExxonMobil, as the partners have repeatedly expressed an interest in the acquisition of the state's 20-percent stake in the port and, if possible, to increase it in due course.

According to Igor Sechin, head of state-owned Rosneft, the Russian company and ExxonMobil are interested in the acquisition of the port, as the companies are looking for a base for the development of the Black sea shelf.

Several weeks ago Sechin sent an official letter to Russia's President Vladimir Putin, asking to approve the potential deal.

Formally, state-owned companies are barred from participating in the privatization of assets, but there is a mechanism to avoid such a restriction, in the case of a sale of such assets in favor of a particular investor without an auction. In the case of the Novorossiysk Port, which has a strategic status, the decision must be taken by presidential decree.

At the same time the current owners of the Novorossiysk Port have already opposed the possible arrival of the oil companies in the list of its major shareholders, believing that this may result in the revision of the strategy of development of the port until 2018, which was recently approved by its management. There is also a possibility that the current corporate conflict may also result in the revision of the strategy.

The strategy involves a significant expansion of the current capacities of the port, through the building of new terminals and the expansion of existing facilities.

At present the annual cargo turnover of the port is estimated at about 90 million tons, however there is a possibility that it can be increased up to 200 million tons by 2020, in the case of a successful implementation of the strategy.

Total volume of investments is estimated at RUB 30.9 billion (USD$1.1 billion), of which 4.8 billion rubles will be invested already in 2014. Particular attention will be paid to increasing the transshipment of high paying freight, taking into account that currently up to 60 percent of the port's space is occupied by cargo, which generates only 20 percent of EBITDA.

Meanwhile, in the Russian port industry overall, last year total volume of cargo transshipment increased by 3.9 percent, compared to 2012, and reached 589 million tons, according to the official data of the Russian Association of Sea Trade Ports.

The biggest growth was observed in the segment of coal, whose transshipment volume increased by 13.3 percent over 2012 and reached 101.1 million tons. The growth was also observed in the segment of fertilizers (up 24 percent to 12.9 million tons) and containerized cargo (up 4.1 percent to 44.4 million tons). The transshipment of crude oil increased by 4.6 percent to 207.5 million tons, while ore was down by 2.8 percent to 7.4 million tons.

In the case of geography, the biggest growth rates observed were at the seaports of the Arctic basin, where the transshipment increased by 20 percent. At the same time, according to analysts' predictions, the volume of transshipment through the Russian Arctic seaports will continue to grow, due to the planned construction of a new port at Sabetta and associated with the increase of cargo through the Northern Sea Route.

Eugene Gerden is a free-lance writer based in Moscow, Russia who has covered the European maritime industry for 10 years. He can be reached at gerden.eug@gmail.com.



Curtin Maritime Delivers Repowered Vessel to Harbor Patrol

By Mark Edward Nero

On April 21, Curtin Maritime, a Long Beach-based marine construction and tug and barge operator, delivered a repowered and retrofitted LCM-8, Sea Force, to the Port of Long Beach Harbor Patrol.

Curtin Maritime was awarded a $1.5 million contract for the design-build project in 2013. The project included the design and fabrication of a new upper and lower house, Tier III-rated engines and generators plus a hydraulic system with a hydro crane and four point mooring system.

The Long Beach Harbor Patrol acquired the vessel from the US Dept. of Defense in 2010, with a goal of converting the boat into a platform that could support both POLB commercial dive units operations, plus serve as an emergency response and salvage vessel within the port.

Because there was no existing design that fulfilled all the requirements, a Request for Proposals with a design build spec was issued by the port to the local shipyards.

After Curtin Maritime was awarded the contract, it was delivered the boat and the project got underway.

Work included the demolition of all the old systems, engine removal and engine room modifications. The old Detroit 12v71 engines were replaced with a set of new Tier III 13.5L John Deere 6135’s mated to the existing 5-14 gear boxes.

Also, two new Tier III John Deere MG65 gensets were put in and mated to dual 66.5-gpm Kawasaki KV3L140 hydraulic pumps. 4 Pull Master H18’s with rapid reversing and 150KG Flipper Delta anchors made up the 4-point system and an 8-ton Hydro crane was mounted on the port side.

The boat was also dry docked and completely repainted and had all new handrails installed. Custom dive ladders were also placed on both the stern and bow.

During an April 21 unveiling at the refurbished vessel at the Port of Long Beach, Harbor Commission President Doug Drummond praised the work performed on the vessel, saying the boat can now play a part in helping keep the harbor safe during times of trouble.

“It has all of the equipment it would need for any kind of problem within the port,” he said of the Sea Force. “It helps us in those unprecedented events that take place, whether it’s an earthquake or some other kind of disaster.”

Seattle Port Begins Water Monitoring Project

By Mark Edward Nero

The Port of Seattle on April 21 kicked off a pilot project aimed at reducing the amount of polluted runoff reaching Puget Sound. The port is hosting a two-year study site for two large metal boxes that will bloom into rain gardens and help reduce pollutants.

Moving Green Infrastructure (MGIF) is a research/demonstration project to test the water quality performance of two state-of-the-art stormwater treatment techniques, a large “rain garden in a box” and a special soil mix with local, volcanic sands.

Two Dumpster-sized steel containers, called “Splash Boxxes,” are being installed side-by-side at Terminal 91. The boxes are a blend of rain garden and cistern, practices referred to as low impact development, or LID. Water quality from a roof in an industrial port area will be tested before and after going through the boxes to see how the two techniques perform.

This research/demonstration project is part of growing efforts to reduce the amount of polluted runoff reaching Puget Sound, which is estimated to receive between 14 and 94 million pounds of toxic pollutants annually.

The effort is in partnership with King Conservation District, Sustainable Seattle, Gealogica LLC, and Splash Boxx LLC.

“The Port of Seattle is working with many partners to restore Puget Sound,” port Commissioner Bill Bryant said. “There is no single solution to saving Puget Sound, no silver bullet, but there are hundreds of different things we can do and this is one of them.”

The information from the study is expected to help shed light on the potential for bioretention planter boxes to improve water quality of polluted runoff in commercial/industrial areas and whether soil mixes used in rain gardens and bioswales could be improved.

The port says the water going into each box from the roof runoff will be tested once a month during the rainy seasons for phosphorus, nitrogen, bacteria, zinc and copper.
More information on the project can be seen at http://www.portseattle.org/Newsroom/Documents/MGIF_Project_Details.pdf.

POSD Honors Tenants’ Environmental Achievements

By Mark Edward Nero

During its April 15 Board of Port Commissioners meeting, the Port of San Diego honored 78 of its tenant businesses for exemplary environmental achievements related to participation in the port’s Green Business Network.

The network is a voluntary program that encourages businesses to incorporate energy efficiency and sustainability into their daily operations. The program, which was implemented in 2010, is a partnership between the Port of San Diego and San Diego Gas & Electric. It offers free resources that help participating tenants reduce their consumption of water and energy, as well as reduce waste on tidelands.

“The success of our Green Business Network is documented in real results that represent significant energy savings and valuable rebates,” Board of Port Commissioners Chair Bob Nelson said.

Among the honorees during the Commission meeting was Continental Maritime, one of the port’s ship repair tenants. In 2013, Continental completed an assessment and upgrade to its exterior lighting. The business switched to LED bulbs, which helped it reduce energy use by 59 percent. It also saved 89,000 kilowatt hours and $19,000 in reduced energy costs.

Another ship repair tenant, BAE Systems, was recognized for achieving a three percent reduction in its energy use from the previous year with its “Clean, Lean and Green” environmental sustainability program. The business also recycles 100 percent of its office paper, metal and abrasive blasting material, according to the port.

In all, the port said, participating tenant businesses earned about $253,000 in energy and natural gas rebate incentives in 2013. They saved nearly 2.5 million kilowatt hours and more than 137,000 therms, the equivalent to powering 154 homes for a year.

POLB to Host Global Exports Workshop

By Mark Edward Nero

The Port of Long Beach, in conjunction with UPS, is scheduled to host a free workshop entitled “Go Global: Achieving your Growth Goals,” on two separate days next month. The workshops are geared toward those new to exporting, as well as those wanting to reach new markets abroad.

Among the information scheduled to be provided: the benefits of going global, and how businesses can increase sales and profits, reduce dependence on traditional markets and grow their international reach.
The first workshop is scheduled for 8 am to noon, Wed., May 7 at The Grammy Museum, 800 W. Olympic Blvd. #245, Los Angeles, CA 90015. The second is planned for 8 am to noon, Wed., May 21 at Ontario Convention Center, 2000 East Convention Center Way, Ontario, CA 91764.

Scheduled speakers for both events include: Port of Long Beach Business Development Manager Gina Barro; Noel Massie, president of the Southern California District of UPS; Brian Peck, the Deputy Director of International Affairs & Business Development for GO-Biz; and Dan Gardner, president of Trade Facilitators, Inc.

Attendance and breakfast are free; however, each venue charges for parking. More information and registration for the May 7 workshop is available at http://www.polb.com/economics/may7workshop.asp. Registration for the May 21 workshop can be done online at http://www.polb.com/economics/may21workshop.asp.