Friday, December 4, 2015

Upriver Container Shuttle Launches

By Mark Edward Nero

Container barge service returned to the upper Columbia and Snake rivers this week with the launch of the Upriver Container Barge-Rail Shuttle. The first barge loaded at the Port of Lewiston and got underway Dec. 3.

The shuttle is expected to help importers and exporters in Eastern Washington, Oregon and Idaho move containerized agricultural products to markets in Asia. An informal partnership including Northwest Container Service, Tidewater Barge and the ports of Morrow, Lewiston and Portland helped facilitate the return of the service.

The service helps to fill the void that emerged with the withdrawal of Hanjin and Hapag-Lloyd’s weekly transpacific service at the Port of Portland’s Terminal 6. After the withdrawals, container barge service on the Columbia-Snake River system and the container terminal in Lewiston, Idaho shut down.

The new service addresses key issues driving up the cost of transportation in the wake of losing direct carrier service at Terminal 6 in Portland earlier this year, including loss of barge service, container availability and cost of trucking to Puget Sound ports. The planning for the return of container barge service started in summer 2015, and required commitments from multiple transportation providers and key exporting companies to make the service viable.

Empty containers began arriving at the Port of Lewiston in October, were filled with agricultural and paper commodities from Idaho and Washington, and are to be barged to the Port of Morrow in Boardman, Oregon. The barge service is expected to continue carrying empties up river and return full every two weeks.

In Boardman, the commodities will be combined with Oregon agricultural and paper products and taken by train to the Northwest Container Service yard in Portland. From there, containers will either remain in Portland for export on Westwood Shipping vessels, or continue by rail to seaports in Seattle and Tacoma.

The project is the outgrowth of work the Port of Portland and the State of Oregon took on with shipping companies across the state to find alternate routes to market until weekly transpacific container service resumes at Terminal 6. The port contributed $51,000 in seed money to kick-start the shuttle project.

The shuttle is expected to be self-sustaining by the second full month of service. Once established, rail service from Boardman is expected to increase to weekly as additional importers and exporters participate in the program.

Currently, Westwood Shipping provides monthly container service from T-6 to Asia. To accommodate other exporters, Northwest Container Service increased rail service from Portland to Puget Sound Ports.

“We appreciate this kind of ‘out of the box’ thinking from all parties involved, providing a partial solution to shipping challenges while we continue working to recruit critical new transpacific service,” Port of Portland Executive Director Bill Wyatt said.

According to the port, the Portland region cargo market of 336,000 TEUs has the potential to support two weekly non-competing, transpacific container carriers. The port recently began targeted outreach to four target carriers that can serve Oregon’s key international markets, Japan, China, and Korea.

Fire Disables Cruise Ship Near Hawaii

By Mark Edward Nero

A fire in the engine room resulted in a Princess Cruises ship losing power Nov. 30 during a voyage from San Francisco to Hawaii.

The cruise ship Grand Princess, carrying 2,592 passengers and 1,095 crew, was in the middle of a 15-day Hawaii cruise that departed San Francisco Nov. 25.

“A propulsion circuit breaker in the ship’s aft electrical switchboard suffered a significant failure, resulting in smoke and a small fire,” the Los Angeles County-based cruise line explained in a statement.

“The incident was isolated but did cause a power outage resulting in the temporary use of emergency lighting and limited air conditioning for a short time,” Princess Cruises said.

The crew was able to extinguish the fire and restart the engine. Power was later restored and no injuries were reported.

The Grand Princess was 20 miles off the coast of Hilo, Hawaii at the time of the incident. All 2,592 passengers aboard the vessel were accounted for, along with 1,095 crewmembers.

Princess Cruises subsequently cancelled the vessel’s port calls to the Hawaiian islands of Kaui and Maui in order to return to San Francisco as scheduled on Dec. 10.

“While there is no impact to maneuverability or safety, the ship cannot attain maximum speed therefore we must adjust the future itinerary,” the company explained.

The Grand Princess, built in 1998, is a 951-foot long vessel weighing 109,000 gross tons. It has a height of 201 feet, a beam of 118 feet and can travel at a speed of up to 22.5 knots.

Port of Oakland Retrofitting Giant Cranes

By Mark Edward Nero

The Port of Oakland said Nov. 30 that it’s raising four massive gantry cranes 26-feet higher to span modern megaships. The $13.95 million project, scheduled to begin in April, is meant to increase Oakland’s capacity to handle giant container vessels.

The taller cranes, located at Oakland International Container Terminal, will be able to reach 141 feet above the dock and will have the height to load and unload ships with capacity up to 14,000 20-foot containers, which are currently the largest vessels calling in the US.

“The big ships come here on a regular basis,” Port of Oakland Maritime Director John Driscoll explained. “This equips us to take on more of them as shipping lines continue to scale up.”

The four 13-year-old cranes each weigh 1,380 tons and are to be supported by jacking frames while their legs are cut away and replaced with new, longer ones. The legs will be fabricated by Shanghai-based ZPMC, manufacturer of the cranes. It will take 10 to 12 weeks to lift each crane, according to the port.

The cranes can lift as much as 65 tons of containerized cargo, and once they’re heightened, they’ll be able to reach three rows of containers higher on a ship.

There are 33 cranes at the port’s five marine terminals, eight of which are tall enough to reach atop the biggest ships in Oakland. The port said it is lifting additional cranes with an eye toward the future of global trade, because more ocean carriers are building big ships to gain economies of scale in transporting containerized cargo.

Panama Canal Authority: Leaks Fixed Next Month

By Mark Edward Nero

Repairs of leaks detected in the newly constructed third set of locks of the long-awaited Panama Canal expansion are expected to be completed in January, the contractor overseeing the project said Nov. 28.

During a joint press conference with the Panama Canal Authority, contractor Grupo Unidos por el Canal said that ongoing work to reinforce the sills in the new locks should be complete by the end of next month.

As part of its remaining work, Grupo Unidos por el Canal is conducting inspections and reinforcements of each individual sill. It also plans to continue the electromechanical testing on the filling and emptying systems of the new locks.

The additional work became required after stress testing of new locks for the Panama Canal revealed water seepage in a specific area of the new Pacific Ocean-side locks in a section that separates the middle chamber and lower chamber.

Despite the setback, the expansion project has now reached 95 percent completion, according to the Canal Authority, and work continues in other areas of the project.

The $5 billion Panama Canal expansion is expected to allow post-Panamax ships to travel through the canal en route to East Coast terminals, thereby bypassing the US West Coast. It was initially scheduled to be complete in 2014 to coincide with the 100-year anniversary of the opening of the existing canal, but snafus have delayed the completion by two years so far.

Tuesday, December 1, 2015

TOTE Cargo Ship Loses, Regains Power

By Mark Edward Nero

A TOTE Maritime cargo ship that lost power and went adrift about 50 miles off the coast of British Columbia in late November is now back underway.

The US-flagged M/V North Star lost power the morning of Nov. 24 while en route to BC from Anchorage, Alaska. However, after spending much of the day working on the problem, crew members managed to fix the issues by 10 pm the same day, and the vessel was able to resume its voyage under its own power without aid from the Canadian Coast Guard, which had been dispatched to the cargo ship.

The 839-foot ro/ro M/V North Star is a former fleet mate of the 790-foot container carrier El Faro, which sank Oct. 1 when its propulsion system failed as it encountered hurricane-force winds and waves east of the Bahamas. A total of 33 crewmembers were killed.

The 15-year-old M/V North Star is one of two US-flagged, Orca-class roll-on/roll-off cargo ships operated by TOTE Maritime Alaska. It serves the Jones Act Tacoma, Washington to Anchorage, Alaska route.

In late 2013, TOTE signed a contract with Finnish corporation Wärtsilä for the conversion of the M/V North Star and its sister ship, the Midnight Sun, to run on LNG. The conversions, expected to be among the largest ever undertaken in North America, have been delayed at least a year due to the El Faro incident, TOTE Maritime President John Parrott said in November.

Oakland Port Testing Night, Weekend Hours

By Mark Edward Nero

Despite a plan by the Port of Oakland to open all gates for night and Saturday hours not yet being approved by the Federal Maritime Commission, one port terminal has already moved forward with a trial version of the program at one of its terminals.

Oakland International Container Terminal, the port’s largest facility, said it is testing increased hours of operations for specific transactions. So far, extended gate transactions have included empty container returns and pick-ups and loaded container export drop-offs.

Specialized import pick-ups known as ‘one stop free-flow delivery’ have also been part of the trial program.

The trial basis program, an experiment to accelerate containerized trade flow, precedes a port-wide plan for Saturday operations that was announced last August and that the port expects to put in place in the first quarter of 2016.

“This is a service for all customers and drayage companies that can utilize the transactions,” Oakland International Container Terminal General Manager Jim Rice said. “We know this may not fit everyone’s business needs, but it has a positive impact on the overall flow of transactions during the day. We will continue to operate night and weekend gates if the demand is there.”

Under the off-hours program – which began the first week of November – drivers receive weekly broadcasts from the terminal advising them of the dates and times for the extended gates. Transaction types may vary depending on the demand.

The Port of Oakland says it has among the highest concentrations of truck transactions-per-gate at any West Coast port, including those in Los Angeles and Long Beach.

The marine terminals are working on a collaborative plan to open permanent Saturday gates for all transactions in 2016. Under the program, which has been dubbed “OakPass” and is modeled after the PierPass program at the Los Angeles-Long Beach ports complex, Oakland terminal operators would charge container fees during peak hours.

The plan’s currently under review by the Federal Maritime Commission.

Nicaraguan Canal Construction Delayed

By Mark Edward Nero

The developer hired by the Nicaraguan government to build an alternative to the Panama Canal, Hong Kong-based infrastructure development firm HKND Group, says it needs another year before it can begin constructing the $50 billion project.

The developer, which originally was to begin construction by late 2015, recently said that it needs more time to “fine-tune” the project, the International Business Times reported in late November. HKND was granted the exclusive right to build the canal in 2013.

As the name implies, the Nicaragua Canal is a proposed waterway through Nicaragua to connect the Pacific Ocean with Caribbean Sea and Atlantic Ocean. The 130-mile waterway is expected to take up to 11 years to complete.

It was in June 2013 that the Nicaraguan legislature approved an exclusive commercial agreement with HKND to advance the Nicaragua Canal and Development Project.

The canal is designed to accommodate container vessels up to 25,000 TEUs, super tankers of 320,000 deadweight tons and bulk carriers of 400,000 dwt. The planned project includes the construction of two ports, a free-trade zone and an international airport.

Growth in East-West trade and ship sizes could eventually lead to $1.4 trillion in total goods value transiting the combined Nicaragua and Panama canals, HKND says its own commercial analysis has found.

Seattle Port Approves 2016 Budget

By Mark Edward Nero

On Nov. 24, the Port of Seattle Commission approved its 2016 budget, which includes an estimated $583.4 million in operating revenues and $335.4 million in operating expenses. The budgeted net operating income before depreciation is $248.0 million.

Also, the total capital budget for 2016 is $408.4 million and the five-year capital improvement program is $2.23 billion, which the port said in a statement reflects its “continuing commitment to investing in the development, expansion, and renewal of port facilities that support regional economic activity.”

“This is not a status-quo budget,” Port CEO Ted Fick explained. “This is a growth-oriented budget so we can spur the regional economy, expand opportunities for small and disadvantaged businesses, increase family-wage jobs, help people acquire skills to move up the career ladder, and protect our environment.”

The 2016 budget includes funding major improvements to the Pier 66 cruise terminal. Under a public-private partnership with Norwegian Cruise Line, the cost to renovate the interior of the terminal to accommodate more passengers and improve mobility along Alaskan Way is being shared.

In 2015, the port saw a nine percent increase in cruise passengers this year over 2014, making it a record year with 898,032 passengers sailing via Seattle. Estimates indicate that 2016 will see another 6.8 percent increase.

Each homeported cruise ship that calls at one of the port’s two cruise terminals generates about $2.5 million to the local economy.

The port’s 2016 budget also assumes a levy amount of $72 million, a reduction of $1 million from 2015; the port had held the levy amount constant the past four years adjusting the levy rate downward as property values increased. A typical King County single-family homeowner is expected to pay $82 per year to fund the port in 2016.

An overview of the budget can be seen at