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Big Ships Delaying Port Projects

Wednesday, 27 June 2018 | 12:00

Money spent by port authorities on catering for big ships is being taken from the capital available for projects, claims the associate vice president and director of US maritime planning at WSP.

Speaking exclusively to Port Strategy at TOC Europe Tom Ward said that port authorities have been forced to spend large quantities of money responding to big ships.

“That’s sucked up their ability to produce new infrastructure. It it’s more of a burden on marine terminal operators and the marine terminal operators don’t necessarily have the money to do what they need to do,” he explained.

Clear limitations

This problem is more apparent in some ports than others but it is certainly an issue in the US, Mr Ward stated. “Long Beach, New York and LA have made major investments, but what happens with ports running out of space to build terminals in and where does the money come from?”

Environmental legislation has also put more pressure on ports to invest in infrastructure, he confirmed.

One solution is for ports to form alliances and this is beginning to become a natural response, so they coordinate investments and do not overbuild.

Ports including Seattle and Tacoma and LA and Long Beach are doing this and it is enabling them to become “less competitive and more cooperative,” said Mr Ward.

Worthwhile investments?

In terms of investment he believes that rather than creating overcapacity, dredging infrastructure investments won’t meet deepwater business demand in the future due to limited suitable land. However, optimisation of existing resources is easier than building a new port, he stressed.

Technology investments pose a financial risk for terminal operating companies as they “cannot get a guarantee of buy-in from shipping companies” unlike tenants in ports.

Heavy automation and complex projects are difficult to achieve as private loans are costly, however, if a terminal operator automates its RTG fleet this may make things more feasible because then a terminal can be automated without being built from scratch.

Digitalisation is also complex as blockchain etc. requires sharing and “these are entities that don’t like to share.”

He added: “A lot of the things that you could gain by optimising a system are almost out of bounds because the data, while it may be there, is difficult to have in one place without hurting someone’s interests.”

Despite this he stressed: “I think we are seeing some process changes. We’re not revolutionary, but evolutionary.”
Source: Port Strategy

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