August 2011 newsletter

Port Bureau News August 2011

www.txgulf.org

Steel 101 Manufacturing Products Member Terminals Spotlight on Mehdi Hejazi Port Manager窶年orton Lilly International

2011 GHPB Dinner Premium Auction Items Sponsored By:

 

Port Bureau Staff Bill Diehl Jeannie Angeli Al Cusick Cristina Gomez Janette Molina Patrick Seeba Josh Whitehead

 Roundtrip Airfare on

Jacuzzi Family Winery/Olive Press Privately Hosted Tour & Tasting

 Beau Wine Tours &

American Airlines Limousine Service



Ledson Winery Visit and Tasting



Four Night Stay at the Fairmont Queen Elizabeth in Montreal, Quebec with access to the Place des Arts, Dominion Square and Place Bonaventure

 Roundtrip Airfare on

Five Night Stay at the Hyatt Regency London—The Churchill with direct access to West End, Portman Square and the Marble Arch



Sonoma VIP Sponsored By:

Four Nights in Quebec Sponsored By:

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Board of Directors *Tom Marian—Chairman *Dennis Hansell—1st Vice Chair.

3 Nights at the Fairmont Sonoma Mission Inn & Spa

American Airlines

Roundtrip Airfare on American Airlines

Five Nights in London

*Mike Drieu—2nd Vice Chair. *John Taylor—Secretary /Treas. *Robert H. Blades

Advertise in the Port Bureau News and Reach 3,500+ Maritime Professionals

*Alec Dreyer

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*Charles H. Flournoy *Capt. Steve Conway *Capt. John G. Peterlin III *Capt. Richard Russell *Steve Stewart *Nathan Wesely Jim Black Ken Burnett Jan Crittenden Celeste Harris Jason Hayley

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Advertisement cost includes 10 hard copies of each issue for distribution.

Port Bureau Membership required for advertising in the Port Bureau News.

Kevin Hickey Guy W. Hitt Charlie Jenkins Shareen Larmond Kathy Murray Jerry Nagel Vinny Pilegge Nolan Richardson Lloyd Schwing Earl Smith Tim Studdert Lawrence Waldron Armando Waterland Don Welch *Denotes Executive Committee Members

Galveston-Texas City Pilots Association Releases HarborLights After months of fine-tuning and detailed work to ensure that the proper infrastructure was set in place, the GalTex Pilots Organization released the HarborLights information for the general public. For current HL subscribers, a duel-tab system will be set up in the coming weeks. If you are not currently a HL subscriber, you may become one by contacting the Port Bureau at 713-6784300.

Captain’s Corner

A View from the Mountains of Ecuador My daughter Rachel just returned last night from Ecuador after

participating in Amigos de las Américas (AMIGOS), a service learning program for high school and college students. The program empowers young adults to grow as leaders and increase their multi-cultural understanding through training and community service projects in Latin America.

Rachel’s program had her fly into Quito, Ecuador, working her way to Santa Rosa and then moving later to a very rural community sitting above the clouds at 13,000 feet.

She mainly interacted with the children of the community through a two hour class she taught on explaining our culture, and family values. She also interviewed the adults of the community to gather information and created a written record of the history of the community – currently, everything is passed down orally. Rachel and her partner also worked on small projects that would benefit the community: for example they were improving the functionality of the school kitchen (she told me that it looked like her younger brothers designed it). Of course as any father I’m extremely proud of her, but as I listened to her tell of her adventures it reminded me that our world is continuing to get smaller. This globalization is why our maritime waterways and community are so important to our nation.

Think about it: one third of our economy is directly tied to global trade, and 95% of that tonnage is moving to and from us by water. At the same time, we struggle as a nation to grasp how our ports are the ramps to this global trade. As a nation, we collect $1.3 billion in a user tax to maintain our waterways yet we only spend half of it on maintaining our channels and harbors.

At the Port Bureau, we’ve spent much of the last year raising the issue of dredging with our elected officials, and while we now have 111 Representatives and 25 Senators from both sides of the aisle signed on to HMTF legislation, we still have a long way to go in the legislative process.

It’s also important that infrastructure development doesn’t stop once the ship ties up to a terminal. Our barge, rail, and highway infrastructure are just as important: our members know that in a competitive market environment, customers are calculating total cost – not just one segment of the journey, so not only do we have to make sure ships are able to get into our port, but that once the cargo’s offloaded, we have everything in place to bring cargo to market.

At our July Commerce Club luncheon, Port Authority CEO Alec Dreyer talked about the hundreds of millions of dollars that the PHA will be using in the coming decade to ensure that our public facilities are ready, and in the coming month, we’ll be reaching out to members to create an regional picture of what the private sector is doing so that we can work better to bring more cargo to our area. We’re going to show the world that Houston is a place where shippers all around the globe can move their cargo quickly, efficiently, and cost effectively. As a side note, I’m sure that as South American business picks up that Ecuador will see our value as an efficient, cost-effective port with whom to do business.

When that works out, I happen to know an excellent sales rep in the making. -Bill Diehl, GHPB

Steel 101

Do You Want to Know More?

Low-Carbon or Mild Steel: Less than 0.3% Carbon Medium-Carbon Steel:

Between 0.3% and 0.6% Carbon

High-Carbon Steel:

More than 0.6% Carbon

Tool Steel:

More than 0.77% Carbon

Cast Iron:

Between 2.1% and 4.0% Carbon The Chemistry

Inside the furnace, the oxygen in air combines with carbon to create carbon monoxide O2 + 2C → 2CO Then, carbon monoxide reduces iron ore to pig iron: 3CO + Fe2O3→ 2Fe + 3CO2 The impure pig iron then needs to be refined in the ladling process to dissolve gasses, sulfur and nonmetallic inclusions .

Look around your desk: from your keys to your computer, steel is all around you. One of the world’s most versatile and ubiquitous alloys, steel is used in everything from shipbuilding and industrial construction to silverware and gravy boats. The Port of Houston is the largest steel port in the country with over six million tons moving across local docks every year—enough to rebuild over one hundred Empire State Buildings, or forty 13,000 TEU container ships.

In production since ancient times, steel is an alloy generally containing more than 90% iron, up to 2% carbon and a mix of other elements that give the final product specific properties. For general purposes, when a steel has less carbon in the mix, it is more flexible (ductile), but also weaker. Steel with more carbon is stronger and harder, but also more brittle. Alloying elements such as chromium and copper help steel resist atmospheric conditions such as rain or ice, while nickel and manganese can be added for increased strength.

Low carbon steel encompasses the cheapest grades of steel, and its uses include sheet for auto bodies and storage tanks, structural shapes and rivets for construction projects and even wire for nails and fencing material. For products which require a stronger metal or heat-treating (changing their mechanical properties such as yield strength and impact resistance), medium-carbon steel balances ductility and strength and is used for many automobile components such as wheels, axles, gears and crankshafts. High-carbon steel may be heat treated as well and is used for products such as high-strength wires, knives, tools, and railroad wheels. The higher the carbon content of the metal, the more that trace impurities and other elemental factors can have a significant effect on the steel’s quality. This means that high-carbon steel must be more carefully produced and is usually more expensive than low-carbon steel.

A Brief History of Steel The oldest known steel was found in 2005 in the Turkish ruins of Kaman-Kalehoyuk. These tool fragments were cre-

ated in 1800 B.C. and had a carbon content of 0.3% showing that even our distant ancestors had basic knowledge of the alloy’s useful properties. Almost 2,000 years ago, the Hayan people of East Africa created a blast furnace that reached almost 3,300 degrees allowing them to forge carbon steel, and the Indians and Chinese have been producing steel since about the same time. The European steel industry began in the 17th century with the development of crucible (a melting container) steel that was cast into ingots before being worked, but the biggest development was Henry Bessemer’s Bessemer Process which was the first industrial process which allowed steel to be mass produced. Bessemer’s oven was able to remove iron impurities by blowing air through the mixture, a process that is still used in an altered form today.

The steel industry has made leaps and bounds in the past century. In 1907, the first electric arc furnaces were brought to the United States by Sanderson In 1948, Robert Durrer tried blowing pure oxygen instead of air into the steel during production reducing smelting time and plant operating costs, and industrial scientists are constantly working to create new innovations in products and processing, fatigue research and new forming technology.

Two Different Furnaces Steel begins with three basic elements: Iron Ore, Limestone and Coke (distilled coal).

There are two types of furnaces generally used for modern steel production. One process takes iron ore and limestone and mixes them before depositing them into a basic oxygen (blast) furnace. The furnace can heat the steel up to 3500-4200 degrees F creating a molten mixture. Then, coke is used to help purify the iron ore, and the limestone is used to help purify and deoxidize the iron. This molten mixture is then poured into a ladle, after which a water-

cooled lance is lowered into the hot metal blowing pure oxygen into the steel. This causes the carbon in the steel to ignite and combust, expelling carbon monoxide and carbon dioxide from the molten metal.

Decreasing the concentration of carbon is important in the steelmaking process, for the higher the concentration of carbon, the harder and more brittle the steel.

Another method of steel production uses an electric arc to melt scrap. Recycling old steel, the electric arc furnace is typically a massive refractory-lined kettle with three electrodes producing a charged arc of radiant energy. Maintaining a constant current and power input, scrap is gathered in large baskets and stacked in such a manner that it will cleanly melt—in some furnaces, a preheater will use the hot gasses emitted from the furnace to warm the incoming scrap to increase efficiency. Then, the basket moves over a hatch, emptying tons of scrap into the furnace. As the hatch closes, electrodes move down gradually increasing the voltage so as to melt form a molten pool of metal without excessive wasted heat damaging the roof and walls. Oxygen is fired out of supersonic nozzles to cut through steel as the scrap melts into molten pig iron. During either steelmaking process, slag is formed— metal oxides such as calcium oxide and magnesium oxide which creates a foam covering the molten steel and the electric arcs. Slag is critical to furnace operations—as more oxygen is blown into the molten metal it bonds with impurities, removing them to the slag as oxides creating a purer product. Both the chemistry and temperature of the molten mixture are regulated and checked, and once both are satisfactory the hot metal is transferred through tilting into a preheated ladle where alloying elements can be added. The alloy element used depends on the exact type of steel being produced and can include manganese, nickel, or chromium.

So What Happens to the Molten Metal?

With molten metal ready to leave the ladle, it is transferred to a continuous casting machine or ingot molds to become a semifinished product. If an ingot mold is used then the metal is processed, cooled, and moved to the rolling mill, where the shape of the ingots is adjusted to a slab, bloom or billet—a semifinished product that will be completed later on.

A more modern and cost-effective way of shaping the hot steel instead of using ingot molds and a primary rolling mill is to use a continuous casting machine. This machine does not require that the steel be shaped into ingots first, but instead forms the hot steel into slabs directly from the ladle. In the continuous casting process, the hot steel is moved directly from the ladle in a steady stream that is distributed into a series of moving molds. The molds shape the metal into the type of slab, bloom or billet that is desired, and as the metal is slowly cooled by means of water pipes that are attached to the molds, it passes through a series of rollers, which straightens the long stream of metal until it rolls onto a table as it is cut to size. The movement of steel from the ladle to the cutting machine is very quickly, and after the steel is cut, it is then taken to the secondary rolling mill to be cut and shaped into the finished product.

As the semifinished products move to secondary mills, they will be transformed into their final forms either immediately, before

Do You Want to Know More?

Alloying Element

Effect

Aluminum

Deoxidization

Boron

Hardenability

Carbon

Hardness, Wear

Chromium

Resists Corrosion

So What’s in My Cargo Hold?

Cobalt

Hardness, Resists Wear

Copper

Resists Corrosion, Strength

Lead Manganese Molybdenum

Machinability Hardness, Responsive to Heat High-Temperature Strength

Nickel

Strength

Phosphorus

Strength

they are allowed to cool (called hot-working) or worked on below their recrystallization temperature for increased machinability, dimensional accuracy or harness.

Silicon

Deoxidization, Hardenability

Sulfur

Machinability

Tellurium

Machinability

Titanium

Eliminates Carbide Precipitation

Tungsten

High-Temperature Strength, Wear

Vanadium

Toughness

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Coils/Sheet/Strip: One of the more ubiquitous products coming off ship, coil may be either hot or cold rolled and several finishing options are available from manufacturers. Coil/Sheet/Strip is used for everything from construction, pressure vessels, and pipelines to automobile sheet, refrigerators, and washing machines. Hot rolled coil is often produced as a feedstock for cold rolled coil, but can also be used as stairs, tailboards and industrial floors when stamped with diamonds or teardrop patterns. Cold rolled coil is generally thinner than hot rolled coil and is used for roofing and wall elements, electrical components such as rotors or stators, and has excellent forming properties, paintability and weldability. Coated coil has a paint powder or film topcoat applied which provides a uniform surface finish particularly suited for steel framed buildings or domestic appliance manufacture.

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Structural Shapes: These hot-rolled flanged shapes are pieces used for buildings, bridges, ships and other large scale construction projects.

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Bar: Steel bar is created in a special mill by rolling billets until they are the proper dimension—this can either be done in a hot-working or cold-working facility, and the finishing can create quality and characteristic distinctions to a customer’s demand.

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Wire Rod: Rolled from a billet and wound into coils ranging from five hundred to over four thousand pounds, wire rod is descaled and drawn through ties to create wire, but can also be used alone as reinforcement for concrete and in other industrial and construction environments.

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Pipe and Tubular Products/OCTG: These hollow products may be either hot or cold rolled. Pipes are used for fluid or gas transport, and are normally categorized by their welds. Spiral Welded Pipe has 30% more weld seam and allows allows a larger diameter pipe to be created from narrower plates (called skelp) which are formed, bent then welded, while Electric Resistance Welded pipe is created using either resistance heating or high frequency induction heating to create a longitudinal weld. The ERW process doesn’t provide protection from the atmosphere so while it is still appropriate for structural use, high-specification environments may require Double Submerged Arc Welding (DSAW). DSAW means the weld takes place under a shield which doesn’t allow the atmosphere into the welding process, creating a stronger seal. Another variety—seamless pipe—is generally formed by taking a heated billet and drawing it over a piercing rod, creating a hollow shell which is then plugged and rolled reducing wall thickness. OCTG generally consists of either drillpipe— heavy seamless tubes that rotate the drill big and circulate drilling fluid, tubing which is used for the oil/gas transport, or casing pipe which lines the hole.



Plate: Thicker than sheet or coil and generally not as pliable, sheet is used for construction of ships, tanks, buildings and a wide variety of goods, these flat products may be hot or cold rolled and are can be up to about 16 ft wide.

-P. Seeba/J. Whitehead, GHPB

GHPB Members Moving Steel in Houston Greens Port Industrial Terminals/WATCO Companies Greens Port Industrial Park (GPIP) is the largest private multi-tenant rail served Industrial Park on the Gulf Coast consisting of 655 acres, 3MM sq. ft. of warehouse space, 22 miles of railroad, 1,100 feet of Contact Greens Port/WATCO deep water dockage, Greens Port Industrial Park Greensport Terminal (West) and a river barge terminal. Greens Port is P.O. Box 96120 Houston, TX 77213-6120 owned by Watco Companies, a Pittsburg, Kansas, based Transportation Company serving transportation, mechanical, trans-load, marine, and intermodal needs of Cus- Ken Burnett kburnett@watcocompanies.com tomers throughout the United States. More information about Watco and its subsidi- Phone: (713) 455-1086 ext. 1 aries can be found at www.watcocompanies.com.

Tim Holan

Approximately 80% of the tonnage moving across the GPIP docks is steel. tholan@watcocompanies.com Phone: (713) 455-1086 ext. 6 Greens Port 2011 YTD tonnage of steel products is up nearly 100% over the same pewww.watcocompanies.com riod last year. The increased tonnage is in sync with the increase in domestic energy production, notably drilling and pipeline activity. In addition to GPIP’s strategic location the facility has unmatched railroad infrastructure allowing customers to enjoy the economical benefits of rail shipments. Greens Port, working with the PTRA and the Watco Trans-load network, has developed unit train capacity for both inbound and outbound shipments allowing customers consolidate throughout the US. Greens Port also expanded its dock to rail and truck to rail operations once in 2011 and is currently bringing additional capacity online.

Greensport Terminal (East)

Inbesa America, Inc. Inbesa is a private terminal offering complete turnkey handling of steel imports and advertises the most competitive rates on the United States Gulf Coast. In addition to steel import turnkey services, they also offer docking, cargo handling, and storage services.

Equipment and facilities Contact Inbesa available onsite include Inbesa America, Inc. 16335 Peninsula Blvd. two 25 ton gentry cranes, Houston, TX 77015 an 87,000 square foot Armando Waterland metals warehouse, and armando@inbesa.com 800,000 square feet of Phone: (281) 452-0063 outdoor storage. www.inbesa.com Inbesa America

Contact Industrial Terminals Industrial Terminals, LP 14035 Industrial Road Houston, TX 77015

Industrial Terminals, LP Industrial Terminals serves as the cargo center for Intermarine’s North American Services, and is the largest project cargo facility in the United States. The terminal is dedicated to customer service and satisfaction, offering safe handling of cargo, documentation accuracy, loading accuracy, vessel and truck turn around time, 24-hour shift capabilities, and new Express Delivery lanes.

Darce Kullman darce@intermarineusa.com Phone: (713) 450-7770 Sheri Escobar sheri@intermarineusa.com Phone: (713) 450-7770

Located on 95 acres along the Houston Ship Channel, Industrial’s facilities include over 2000 feet of deep water berths, a 1500 foot barge channel, covered warehousing facilities, rail and truck access, and cargo marshaling areas. The deep www.intermarineusa.com water and barge berths allow vessels to be serviced simultaneously, and the docks can service vessels up to 550 feet long. Equipment includes cranes with capacities from 65 to 300 tons, top loaders, forklifts with capacity of 60,000 pounds, and a fabrication shop and certified truck scale. The terminal has the capability to handle all types of cargo, including project cargo, Industrial Terminals, LP tubular goods, rolling stock, containers, and break bulk cargo.

Manchester Terminal Corporation Contact Manchester Manchester Terminal Corporation 10000 Manchester Street, Suite A Houston, TX 77012 Vinny Pilegge vinny@manchesterterminal.com Phone: (713) 926-9631 www.manchesterterminal.com

The Manchester Terminal Corporation covers 72.4 acres and contains over one million square feet of interior storage space. Located at the Intersection of the Houston Ship Channel and the Sims Bayou, Manchester offers two docks to accommodate vessels, and one of the largest covered warehouses in Houston. The terminal is fully capable of handling breakbulk and containerized cargo, light manufacturing operations, assembly operations, the two docks offer over 3,200 feet of access to the Houston Ship Channel.

Manchester is also an extremely accessible facility: located just five city blocks from the I-610 loop, the Houston Metro Bus stops at the front gate, and many truck lines are available for customers, in addition to railway switching service provided through the Port Terminal Railway Association.

Manchester Terminal Corporation

Port of Houston Authority The Port of Houston Authority prides itself on its leadership position in bringing global trade and commerce to Houston. Their turning basin wharves sit directly on a 200-acre industrial park, with facilities for marshaling, consolidation, and for the storage of steel.

The Port of Houston has many facilities perfect for businesses in the steel industry, including 12 open cargo wharves, almost 2 million square feet of covered storage, and over 3.3 million square feet of open storage offering customers direct discharge-to-truck capacity. The industrial parks in the turning basin also have many privately leased yards offering shippers a wide variety of choices when it comes to storage. Port Bureau members Richardson Stevedoring and Logistics, Shippers Stevedoring Company, and Kinder Morgan (TX Terminals) join Ranger Steel Supply, Alltrans, Storage & Processors, PCI yard, and Arrow Steel, in a full array of options from direct sourcing and delivery to testing, certification, examination, and bundling.

In addition to the Turning Basin, the Port Authority moves steel through the Woodhouse, Jacintoport and CARE terminals. In addition, the container terminals of Bayport and Barbours Cut move steel: it is their number two import commodity in containerized cargo with over 700,000 tons/ year.

Contact PHA Operations (TB) Port of Houston Authority 111 East Loop North Houston, TX 77029 Randy Steifel rsteifel@poha.com Phone: (713) 670-2400 Angus Hanes ahanes@poha.com Phone: (713) 670-2674 www.portofhouston.com

City Dock 32 & Industrial Park East

The Houston City Docks—Turning Basin Terminals

Texas Terminals, LP Texas Terminals’ 65acre private facility provides stevedoring and transportation services to a myriad of industries from across the world. As a full service stevedoring company, with discharge and load out service available for vessels and cargo, the stevedoring service at Texas Terminals includes a facility with computerized operations, competitive rates, and a trained and experienced staff. The terminal also offers some stevedorerelated services, including cargo planning, stuffing, stripping, container repair, and short and long term container storage.

The terminal offers extensive facilities, including over 56,000 square feet of warehouse storage space, 1150 feet of dock frontage, and over 20 acres of marshaling area. Along with these facilities, equipment available includes over a dozen forklifts with capacities of 5000-52000 pounds, three cranes, top and front end loaders, a bulldozer, yard trucks and trailers, locomotive, spreader bars, and a welding crew on the terminal staff.

Texas Terminals holds permits for fueling, painting and hot work services. -P. Seeba/J. Whitehead, GHPB

Contact Texas Terminals Texas Terminals, LP 15902 Peninsula Blvd Houston, TX 77015 Joe Burkett jburkett@texasterminals.com Phone: (281) 457-3131 Peter Wurschy pwurschy@texasterminals.com Phone: (281) 974-9190 www.texasterminals.com

Texas Terminals, LP

Spotlight on Mehdi Hejazi

Port Manager—Norton Lilly International

“Have you ever been into a courtroom? Because this was my first time, and one of the things I realized very quickly was that the lawyers, the judge, even the bailiff, they all work with each other every day, and it’s very obvious when you’re the new guy in the room. So the judge asked me “Are you this sailor’s attorney?” and I said “No, I’m the agent for his ship”, and the judge looked at me a little funny as I explained everything an agent is responsible for—including, this day, defending a sailor when the owner asked us to handle a situation—and then the games started… I was in there for hours, but at the end of it all, I got the man back to his ship and it left port without a delay. That’s my job.”

Growing up in Mobile, Alabama, Mehdi Hejazi drove past the tall cranes of the Port of Mobile every week, but never realized how large a role they’d come to play in his life. After graduating from the University of Alabama in Tuscaloosa with a degree in International Business Management, Mehdi came back to Mobile and worked at his father’s international market whose wares included a wide variety of gourmet foods and an extensive wine collection. Within a few years, he was back at school, studying for his MBA when he got into discussions with friends living in Long Beach about the shipping business. Soon, Mehdi knew exactly what he wanted to do and began work in 2004 with Norton Lilly as a boarding agent in New Orleans, LA. “So it was one of my first ships—a grain ship with a Chinese crew. I boarded four hours before departure, was hanging out, trying to learn as much as I could, and went to check in with the Captain. Captain looked at me, said “Yeah, I’ve got a problem” “Okay, what’s the problem, Cap’n?” “Well, my chief engineer is not on board” “No problem, we’ve got some time” “No, you don’t understand… … I haven’t seen my chief engineer in two days now. … and chief likes to gamble.” Thinking quickly, I counted the three casinos within driving range of the pier, and called them asking to ask for the engineer over the PA system—to learn that, with no chance for small children to get lost in the casinos, the buildings didn’t have a PA. So I grabbed a mate with jumpsuit and hard hat and drove to the casino. After arguing with security over the mate’s lack of proper ID, we walked into the building to search and very quickly we found the Chief… surrounded by stacks of chips.”

After his training in NOLA, Mehdi transferred to Norton Lilly’s biggest office in Long Beach, CA where within a few short years, he worked his way up to operations manager, and finally port manager. Working about 150 ships every month, his area of operations covered from San Diego to Port Hueneme, including the Ports of LA/LB, and Mehdi worked every type of ship that came through the area. “We had tankers, lightering vessels, dry cargo—my specialty—even cruise ships. I tell you, cruise ships can be an interesting challenge. You see everything from fixing women’s shoes to one time where I had to find a local ice sculptor because the one on board sprained his wrist and couldn’t work.”

In May 2011, Mehdi returned to his southern roots as he took over the position of port manager for Norton Lilly’s Houston office. Looking forward to expansion, he notes “It’s a bigger port complex down here, by most metrics the largest port in the country, so there’s a tremendous opportunity for us to grow. There’s also a lot more competition down here which keeps us sharp and focused on going the extra mile for our customers.” In his spare time, Mehdi’s an outgoing person who enjoys getting to meet his neighbors and spend time in the community as well as an avid sports fan who is looking forward to a new NFL season with a local team for the first time since 2005.

Norton Lilly International is an integrated and diversified service provider within shipping, logistics and marines services in the United States, Canada, Panama and Caribbean ports, handling all types of vessels from sophisticated gas and chemical carriers to dry bulk carriers and cruise vessels, as well as more specialized products such as break-bulk and heavy lift. Norton Lilly’s in-depth local knowledge of operating conditions, and strong relationships with all local and government bodies ensures that the best interests of their customers are maintained at all times.

Hurricane Season Preparations

A Message from USCG Sector Houston-Galveston

The 2011 Hurricane Season officially started June 1, 2011. All facilities and vessels in the Houston-Galveston Captain of the Port (COTP) zone are encouraged to review their severe weather plans and begin preparations for the Hurricane season.

1. It is recommended that all deep draft vessels depart port for sea well in advance of an approaching storm as soon as practical. Requests to remain in port from deep draft vessels will only be accepted for vessels that have a greater risk going to sea than mooring in the port. Those vessels intending on remaining in port during a storm’s passage should submit a completed Declaration of Intent to Remain in Port within 12 hours after setting Port Condition Whiskey – normally set when gale force winds from a storm are expected to arrive in port within 72 hours.

2. Commercial vessels, including tug and barge tows that normally transit the Gulf Intracoastal Waterway, should depart the area when threatened by a storm. If unable, they should seek alternative refuge by moving as far inland as possible and take shelter on the bayous and fleeting areas within the Houston Ship Channel. Special precautions should be taken and are expected for tows with CDC cargoes. The COTP recommends keeping a live watch onboard to tend lines and control power as the risk of groundings or allisions becomes an even greater concern.

3. Commercial fishing vessels should leave port or find shelter inland to avoid damage during a storm’s passage but should avoid transiting near or anchoring in Security Zones.

4. In order to safeguard Coast Guard waterway reconstitution capabilities and maintain continuity of operations, Sector Houston-Galveston, Sector Field Office Galveston, and MSU Texas City personnel and equipment may be relocated to a secure area prior to the arrival of a storm. Depending on the severity of the storm, a remote command post may also be established in a secure area. Should this be necessary means to contact the remote command post will be disseminated via MSIB and Port Coordination Team teleconferences. VTS Houston-Galveston will remain active at a minimum until 12 hours before the arrival of hurricane force winds when all internal movements cease.

5. Facilities with storage tanks, missile hazards, dangerous cargo, and container or pallet stacks are encouraged to take positive action to secure or remove these entities should they be threatened by a severe storm. Pressed up tanks will sustain less wind damage than those left empty or partially full. All containers stored near flood-prone areas should be moved prior to Port Condition Yankee.

6. The responsibility to survey berths at a facility’s docks rests with each facility. Therefore, waterfront facilities are encouraged to conduct an annual survey prior to hurricane season. Additionally, each facility should be prepared to have an emergency survey conducted at their docks as soon as practical after a hurricane passes. The surveys can determine whether water depths have changed and whether ship traffic is able to safely proceed.

7.

This notice will be posted on Sector HoustonGalveston’s HOMEPORT website at http:// homeport.uscg.mil. If you have any questions or concerns, please contact Sector Houston-Galveston at (713) 6789001.

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(top-left): Alec Dreyer, Port of Houston Authority, Pete Reixach, Port Freeport (upperleft): Steve Nerheim, Houston-Galveston VTS, Captain Tom Goodwin, Houston Pilots (lower -left-center: Bob Fry, Marinus Management Corporation, Art Flanagan, HUB International Rigg, and David Moon, PTRA (lower-left): Warner Welch, Houston-Galveston VTS, and Marcus Woodring, Port of Houston Authority (bottom-left): Pat Studdert, Buffalo Marine Service (standing) greets Clyde Fitzgerald, SAGCD-ILA, and Jimmy Jamison, Port of Houston Authority (bottom-center): Richard Brazzale, and John Foster, Cutinho & Ferrostahl (bottom-center-right): Buddy Tucker and Ed Foster, The Mundy Companies (bottomright): Bob Moore, Saltzgitter Mannesmann during the Q&A session (lower-right): Joe Burkett, Texas Terminals, Jerome Koch, Jumbo, and Peter Wurschy, Texas Terminals (lower-right-center): David Moon, PTRA and Bill O’Keefe, Cornerstone Preferred Resources (upper-right-center): Tony Sartori and Mike Voinis, HALFF Associates (upperright): B.R Williams, Larry Sopchak, Bennie Holland, and Clyde Fitzgerald, ILA (top-right): Karen Patterson, Texas Mooring, and Tom Marian, Buffalo Marine Service (middle): Alec Dreyer, Port of Houston Authority CEO addresses a question after his speech to the Commerce Club

Port Watch

Tom Marian—Buffalo Marine Service The Port of Houston ship arrival tallies for the end of the 2nd quarter were consistent with the entire quarter’s performance – down. Historically, the early summer months on the port front are “rebuilding” months prior to the fall import runs. Thus, it did not come as a surprise that Houston experienced its 3rd consecutive drop in vessel arrivals registering an 8% decrease from May to June. Exports for the Port continue to be robust and the Houston Ship Channel arrival numbers remain 10% above last year. The public dock count took the lion’s share of the June drop at 9% but its 2011 increase is brighter than 2010’s numbers with an 11% increase compared to the private dock increase of 9.5%. The Houston private dock performance was off by over 7% from the May arrival numbers with a mere 12% of those terminals experiencing any increases in June. Yet, the vast majority of those docks have left 2010 “in the dust” as several terminals have posted triple digit gains in the last year. Chemicals, cement, grain and bulk commodities are all benefiting from the 2011 largesse.

To the immediate south of Houston, the Port of Texas City continued to benefit from the region’s bustling petrochemical trade with a dramatic 31% increase for the month – its best month of the year by far. This helped boost its arrival tally to over 6% over last year’s. To the south of Texas City, the port of Galveston also posted a monthly double digit gain of over 15%. This edged up the overall 2010-to-2011 vessel arrival count by nearly 8%. Other than Corpus Christi’s 5.5% gain for the month, the remainder of the larger Texas ports were down. Specifically, Freeport fell by 21% and Sabine was down by over 18%. The good news is that every major port is up for the year with the exception of Freeport which is off by over 6% against 2010’s arrivals.

All in all June could have been flatter given the month’s tendency to be less than energetic in the ship count department. Yet, there are still some disconcerting signs within the numbers. The crude oil trade has been relatively lackluster in terms of volume as reflected in a 19% decrease in tank vessel traffic in Houston and a mere 1% increase for the year in tow movements through the Houston Ship Channel. Not unexpectedly, most of Houston’s vessel type categories were down with LPG and Chemical Tankers leading the pack with 17% and 14% drops respectively. So, when you throw that all in the mix, an off quarter is not necessarily a “double-dip” precursor. More importantly, with the recent activity generated by shale gas production in Texas; significant increases in the population in the San Antonio-Austin-Houston triangle (i.e., more consumers); and an expanded Panama Canal opening that coincides with the Port of Houston’s Centennial in 2014, all the pieces are in place to positively move forward.

–Tom Marian, Buffalo Marine Service

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Greater Houston Port Bureau

Greater Houston Port Bureau—111 East Loop North—Houston, TX—77029

713.678.4300

WWW.TXGULF.ORG

Upcoming Events August 20

GHPB Members Advertise in the Port Bureau News

82nd Annual Maritime Dinner Houstonian Hotel

August 30

Maritime Steel and Petrochemical Outlook Conference Pasadena Convention Center

September 8

Commerce Club Luncheon Brady’s Landing Restaurant Mayor Annise Parker, City of Houston

October 1

Houston International Seafarer’s Center Gala Houston Marriott South

November 7

Captain’s Cup Golf Tournament Brae Burn Country Club

Reaching 3,500+ Professionals in the Houston Port Region, contact the Port Bureau at (713) 678 4300, or pseeba@txgulf.org to arrange for either 1/6 page, 1/2 page, full page, or back cover advertisements.

GREATER HOUSTON PORT BUREAU 111 East Loop North Houston, TX 77029 713.678.4300 ph 713.678.4839 fax www.txgulf.org