Retailers Oppose Free Time Reduction Proposal

By Mark Edward Nero

The National Retail Federation on Jan. 7 sent a letter to the Port of Long Beach expressing concerns about the port’s plan to reduce the amount of time import containers can be stored for free on the docks.

Since 2005, the length of time containers can stay on the dock – known as “free time” – has been four days. Beyond that, terminals are charged storage fees. Port officials said last October that they’re proposing changing free time to six shifts – the equivalent of as few as three days – in order to encourage terminals to more consistently operate at night and move imports off the docks faster.

The National Retail Federation’s letter, which was addressed to the POLB CEO Jon Slangerup and Chief Commercial Officer Noel Hacegaba, was signed by NRF Supply Chain & Customs Vice President Jonathan Gold. In the three-page missive, Gold said that the NRF applauded the port’s efforts to reduce congestion on the docks, but that it wanted to express its concerns about the plan.

“Unfortunately we do not believe that reducing free time from four days (essentially eight shifts) to just six shifts (three days) on its own will address the ongoing congestion and throughput issues,” the letter stated. “Reducing free time as proposed will only lead to additional congestion and operational issues, and most importantly potentially additional costs to NRF members by way of demurrage.”

Gold argues that without uniform shifts across the terminals, determining the last free day will become a manual process, and that this will render the current automated systems being used to determine the last free day “useless,” because different terminals will have different shifts that change weekly, the importer will be required to manually manage the last free day for each container and bear the repercussions that this manual environment will produce.

“The proposed calculation based on shifts could lead to more congestion in the ports because of the uncertainty over the last free day,” Gold wrote. “This uncertainty will lead to missed container pick-ups, resulting in more containers trapped at the terminal.”

Among his proposed solutions to congestion: an increase in terminal operating capacity, lanes and gates to support increased and improved daily throughput.

A more balanced proposal, he wrote, would address the actual congestion issues happening within the terminals. We would like to see the terminals sharing in the financial responsibility for said congestion by, among other things, paying drivers for their wait time at the docks.

The port says that staffers are working with stakeholders to develop a final plan on the free time reduction that will be sent to its harbor commission for consideration later this year.

Harley Marine Acquires 10 Vessels

By Mark Edward Nero

Marine transport provider Harley Marine Services said Jan. 7 that it has acquired certain offshore assets of Louisiana-based Enterprise Marine Services, including six double hull petroleum barges and four tugboats.

Harley Marine also said that it’s acquiring “the expertise and knowledge of current Enterprise employees associated with these assets,” in order to make the transition as smooth and seamless as possible as the vessels are incorporated into the Harley Marine fleet.

The acquired assets are to be used in current operations to strengthen market presence and support long-term customer demand and growth, the company said.

“The acquisition strengthens our market presence and allows us to grow with our customers’ needs,” Harley Marine Services Chairman and CEO Harley Franco said.

Harley Marine has operations along the West Coast, including Alaska, New York Harbor and the US Gulf Coast.

Services provided by the company include the transportation and storage of petroleum products, ship assist and escort, the transportation of general cargo and rescue towing.

Port of Longview CEO Fired

By Mark Edward Nero

Geir-Eilif Kalhagen has been terminated without cause from his position as Chief Executive Officer at the Port of Longview, the port announced during its Jan. 5 Board of Commissioners meeting. The termination is effective immediately.

The Board of Commissioners reached the 3-0 decision, it announced, based on differences between it and Kalhagen regarding a vision of growth and development for the port.

Those differences became apparent during the review of a 2014 proposal to place a $300 million propane and butane export terminal at the port. Kalhagen had supported a plan by Haven Energy Terminals to move propane and butane currently being flared in the Midwest to energy markets around the Pacific Rim. The company was looking at building a unit train-accessible rail unloading facility, storage tanks and ship loading area at the port with the ability to load marine vessels with a capacity of up to 550,000 barrels.

But in March 2015, the port commission unanimously voted to not enter into the lease agreement. Several reasons were given including community opposition and the belief that the project provided too few jobs to justify the risks presented.

The Commission said this week that it plans to explore “all options” for interim and long-term succession plans for the CEO position, while also expressing confidence in the port’s current senior leadership to oversee all operations while the Board of Commissioners evaluates its options.

Port Chief Operating Officer Norm Krehbiel is expected run the port during the search for Kalhagen’s replacement.

Kalhagen was hired in July 2012 to replace Ken O’Hollaren, who retired after nearly 25 years as CEO. Prior to joining the Port of Longview, Kalhagen was the general manager for the Pacific Northwest office of Tidal Transport & Trade, a position he held for a little over two years. Before joining Tidal Transport in June 2010, he spent 15 months as an operations manager with Grieg Star Shipping.

From December 2007 to January 2009 he was an operations manager with Star Forest Carriers PTE Singapore. A year after he was hired at Longview, he received a six percent raise and three-year contract extension that was supposed to keep him at the port through at least September 2016.

Under a severance package approved by the port, Kalhagen is to be paid four months salary — about $60,000, based on his $187,000 annual wage – and he’ll receive 12 months of health benefits, according to port staff.

USCG Detains Bulk Carrier in Seattle

By Mark Edward Nero

US Coast Guard personnel detained the bulk carrier ship Lowlands Kamsar in Seattle on Jan. 4 after an exam detected several significant violations. The crew of the ship was conducting cargo operations at the time of the examination.

During the exam, Coast Guard Port State Control officers discovered that the automatic fire extinguishing system that protects the vessel’s engine room had been disabled by the crew. Additionally, according to the USCG, the vessel’s owner, Misuga S.A., failed to ensure that appropriate corrective action was taken.

The vessel, a 751-foot, Panamanian-flagged ship that was built in 2010, has been ordered by the Coast Guard to remain in Sector Puget Sound’s Captain of the Port zone until the violations are corrected.

“The Port State Control program holds foreign flagged vessels to internationally agreed upon standards to ensure the safety of life at sea,” explained Port State Control Branch, Sector Puget Sound Chief Lt. Kimberly Glore. “Fire detection and extinguishing systems are vital systems that must be ready for immediate use in case of a fire onboard the ship.” Glore said that her branch is continuing to monitor the Lowlands Kamsar and has been working with the bulk carrier’s crew and Panamanian representatives to correct the vessel’s deficiencies.

Oakland Terminal Reopens After Upgrade

By Mark Edward Nero

A Port of Oakland marine terminal has reopened following two months of modernization to improve cargo handling and this week is scheduled to receive its first container ship since early December.

The 74-acre Ben E. Nutter Terminal, located in Oakland’s Outer Harbor, is managed by Everport Terminal Services. Renovations of it began in November and were complete last month. Improvements include rebuilt entrance gates for harbor truckers; more than 100 new pieces of cargo-handling equipment; and a new terminal operating system.

The terminal reopened last week to begin receiving export cargo and empty containers, and was scheduled to resume vessel operations Jan. 8 with arrival of the 1,100-foot container vessel Ever Liberal.

“Across the port we’re taking steps to improve performance and efficiency,” Port of Oakland Maritime Director John Driscoll said. “We’re pleased that the management of Ben E. Nutter Terminal shares our desire to upgrade operations in Oakland.”

The Nutter terminal at Berths 35 through 38 serves all Evergreen Line ships calling Oakland. It’s named after former Port of Oakland Executive Director Ben E. Nutter, who’s regionally considered a pioneer in containerized trade.

New Vancouver Shipyards VP Announced

By Mark Edward Nero

British Columbia-based transportation company Seaspan Marine said Jan. 4 that Ian Brennan has joined its subsidiary Vancouver Shipyards as Vice President, Supply Chain Management & Contracts.

As part of Seaspan Shipyard’s executive team, he’ll be responsible for and day-to-day oversight and direction of supply chain, warehousing and logistics, procurement, and contracts and subcontracts in support of new vessel construction at Vancouver Shipyards.

He joins the company from General Dynamics Mission Systems – Canada where he was chief counsel and corporate secretary. In that role, he was responsible for export/import, anti-bribery and trade restrictions compliance, intellectual property and licensing matters, design and management of procurement terms and conditions of purchase and sale, and all commercial and legal matters.

Prior to that, he was Commercial and Procurement Director for Project Management International Ltd. in the United Kingdom. Overall, he has more than 27 years of experience in the shipbuilding and heavy project construction industries.

“I am very pleased to welcome Ian to the team at Vancouver Shipyards,” Seaspan Shipyards President Brian Carter said. “Ian’s diverse corporate and shipbuilding experience coupled with his proven success in delivering on complex projects will be an asset for Seaspan’s new construction program.”

Vigor Gets Olympic-Class Ferry Order

By Mark Edward Nero

Washington State Ferries signed a notice to proceed in late December with shipbuilder Vigor Industrial for work on a 144-vehicle ferry, with work slated to begin this month.

The ferry is to be built at Vigor Industrial and is expected to support about 500 jobs at Vigor’s Seattle shipyard and contractors around the region. The budget to build the vessel is $122 million, with delivery scheduled for mid-2018.

Along with current vessels Tokitae, Samish and Chimacum, the fourth Olympic-class ferry is expected to improve fleet reliability and safety by replacing four of the state’s oldest ferries, which were built during the 1950s and 1960s.

The first two Olympic-class ferries were delivered on time and under budget. The third vessel, under construction at Vigor, is reportedly on schedule and under budget, and is expected to be assigned to the Seattle/Bremerton route in early 2017.

Olympic-class ferries are equipped with the latest emergency-evacuation and fire suppression systems, Americans with Disabilities Act-compliant elevators, and wider car-deck lanes that provide more room for passengers to access their vehicles. The vessels’ hulls are designed to reduce wake and provide better fuel efficiency, while cleaner burning engines reduce emissions.

“Our top priority is keeping the ferry system safe and reliable for the millions of commuters, freight haulers and travelers who depend on us every year,” Washington State Ferries Chief of Staff Elizabeth Kosa said in a prepared statement. “Thanks to state lawmakers and critical funds from Connecting Washington, we are able to meet some of the ferry system’s most urgent needs, including building this new ferry.”

A public process to determine the fourth ferry’s name is being led by the Washington State Transportation Commission.