Port Strategy May 2019

MAY 2019 â?˜ VOL. 1019

ISSUE 4

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INSIGHT FOR PORT EXECUTIVES Red alert for fraud | Tech/worker convergence | Carbon capture opportunities | UK planning frustration

UNLOCKING BLOCKCHAIN POTENTIAL Making sense of digital ledgers

The international magazine for senior port & terminal executives EDITORIAL & CONTENT Editor: Carly Fields editor@portstrategy.com News Reporter: Rebecca Jeffrey rjeffrey@mercatormedia.com

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Not-so-fair wind

From Asia to America, changing weather patterns are keeping ports on their toes

When a senior shipping line executive totalled the number of operational days lost to weather-related shutdowns at Shanghai last year, I’ll admit I was genuinely shocked at the figure he gave.

Ocean Network Express chief executive Jeremy Nixon counted that Shanghai was shut for 25 days between April and August 2018, with eight of those days in August alone. The world’s largest port closed for 7% of the year because of a jump in the amount and severity of typhoons and cyclones in Asia. Think on that.

Mr Nixon warned that this is “a real disruption and a real reality” for ports and terminals in the region and he’s not wrong. In conversation with another Asian terminal operator, I learnt of the knock-on effects of those closures in 2018 and heard anecdotally how berth planning “went out of the window” when they tried to accommodate the ships locked out of Shanghai.

On the upside, the operator confided that informal intra-port berth sharing came into play to facilitate diverted calls as best as possible.

However, he conceded that this was a short-term fix and not a long-term solution – this particular port simply doesn’t have the spare capacity necessary to cater for ultra large container ships if weather closures force them to abruptly turn away from their final destination.

Of course, weather-related issues for shipping are as old as the industry itself. But putting a hard number on complete port shutdowns puts the scale of the problem into perspective.

Panama too is suffering from unusual weather-related challenges, with much drier than average rainfall in December forcing the Canal Authority to reduce the maximum allowable draft for ships that use the wider neopanamax locks. While ships with a maximum draft of 50 feet should be able to travel through them, the restriction in early May was for a maximum draft of 45 feet. This means that the larger containerships can’t carry as much freight through – bad for them and bad for Panama’s coffers as tolls are calculated on freight.

In the US, Long Beach is expected to publish its Climate Action and Assessment Report in the second half of the year and if Los Angeles’ already-completed report is anything to go by Long Beach’s won’t make pleasant reading. When LA published its report some years back it found that three of its 10 shipping piers could be inundated with water even in the mildest sea-level rise projections.

Inclement weather is causing problems, no doubt about it. And with confirmation that the El Niño natural climate pattern has arrived this year, ports should prepare for further disruptions. ONE’s Mr Nixon confirmed that his line now schedules services differently to overcome closures.

The silver lining? Second tier ports may find that if they proactively approach lines now they could carve a niche for themselves offering weather contingency planning services.

For the latest news and analysis go to www.portstrategy.com/news

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MAY 2019 | 3

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CONTENTS

MAY 2019

14 15 FEATURES

8

NEWS

18 Forging links between disparate blockchains

COLUMNS

16 Cuba crackdown to hit ports Port construction companies are among businesses which could be hit by a US government offensive on Cuba

18 Setbacks for APMT’s LA automation plan APM Terminals’ application to modernise Pier 400 is being strongly contested by unions

10 Stop ‘unfair’ port access practices

14 Congestion drives modal shifts Road congestion, and its deleterious environmental impacts, could be driving change in supply chains around New York

ISSA calls for an end to unwarranted delays, obstructions and unfair charges for port deliveries

15 Meeting tomorrow’s labour demands

12 DPW seeks larger Latin America stake DP World confirms it is looking at concessions in up to seven Latin American ports in the next year

Online portstrategy.com 5 Latest news 5 Comment & analysis 5 Industry database 5 Events

25

Automation and the transition towards sustainability may force us to rethink the central position of work in ports

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17 Get set for energy savings The surge in action on climate change and transitions to carbon neutrality both require tackling the challenge of rising energy costs

Digital ledgers offer undeniable benefits of improved transparency and security, but which project should ports back?

22 If it looks too good to be true, it probably is Fakes, forgeries and misleading claims; ports and shippers would do well to question things more often

24 Bringing people along for the tech ride Automation and AI are pushing forward but what happens to the workforce?

26 Offering a safe haven for carbon storage The move towards carbon capture is gathering pace and ports are playing their part

29 Frustration of a one-track planning environment Brexit: UK ports can’t be sure about it, can’t get past it and can’t ignore it, but they are trying to look beyond it

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MAY 2019 | 5

THE STRATEGY

BRIEFS

CUBA CRACKDOWN TO HIT PORTS

Urgent re-tender of Valparaíso T2 In Chile, the head of the national shipowners’ association Ricardo Tejada has forecast a prompt retendering of Terminal 2 (T2) at the Port of Valparaíso following the departure of concessionaire Terminal Cerros de Valparaíso (TCVAL).

TCVAL recently surrendered its concession, arguing that the time taken to complete the environmental impact assessment meant that it could no longer make a profit from going ahead with the implementation of the project.

Spain faces another competition probe Spain’s National Commission on Markets and Competition (CNMC) has announced that it is to investigate competition not only between Spanish ports but also with those of other countries. “The purpose of the study is to identify if there are restrictions on competition … and to propose, if necessary, measures that mitigate the negative effect of the same,” said the CNMC.

ICTSI eyes Philippines site International Container Terminal Services Inc (ICTSI) is negotiating with banks to purchase the facilities of bankrupt shipyard Hanjin Heavy Industries and Construction Philippines (HHIC Philippines). The Philippines-headquartered port operator said it will repurpose the site from its current use if the purchase goes ahead. It will consider developing the 300-hectare site into several multipurpose facilities including ports, power and steel, reported Ships & Ports. “We’re still making presentations to the banks … we’re developing a masterplan for Hanjin,” ICTSI chairman and president Enrique K Razon, Jr said.

6 | MAY 2019

Port construction companies are among businesses which could be affected by a US government move that enables parties to sue businesses in Cuba deemed to have profited from private land seized during the country’s 1959 revolution.

As part of a crackdown on socialism in Cuba, President Trump’s national security adviser John Bolton said that a portion of the ‘Title III of the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996’ would be activated, reported Politico. This will allow US citizens whose property was seized in Cuba after Fidel Castro’s regime took power to sue businesses who have made money

from the ‘trafficking’ of ‘stolen’ land. There are reportedly already claims for the Port of Havana.

Mr Bolton also announced sanctions targeting the governments in Venezuela and Nicaragua.

In a speech to the Bay of Pigs Veterans Association, Mr Bolton confirmed that a ship involved in transporting oil from Venezuela to Cuba had in April been denied entry to a US port for the first time.

In a transcript of the speech, Mr Bolton said that the ship, Iron Point, belonged to a company that is one of multiple firms to have been sanctioned for transporting oil from Venezuela to Cuba.

8 President Trump’s national security adviser John Bolton announced the Cuba crackdown

He said the US has “imposed sanctions on four companies and nine vessels that transported oil from Venezuela to Cuba in recent months.

“This follows our action earlier this month to sanction 35 vessels, and two companies, involved in shipping subsidised oil from Venezuela to Cuba.”

PSA International, which manages a container terminal at the Port of Mariel, issued a “no comment” to Port Strategy, when asked about the Act’s potential impact.

DJIBOUTI ORDERED TO PAY $385M TO DCT DP World secured another legal victory in April when the Djibouti government was ordered to pay $385m plus interest to Djibouti port operator Doraleh Container Terminal (DCT) for breaching its exclusivity rights by developing container facilities at Doraleh Multipurpose Terminal.

Ruling on the case of DCT, 33.34% owned by DP World Group and 66.66% by Port de Djibouti S.A., an entity of the Republic of Djibouti, the London Court of International Arbitration (LCIA) found that by developing new container port opportunities with Hong Kong-

based port operator China Merchants, Djibouti breached the rights of DCT under the 2006 Concession Agreement to develop a container terminal at Doraleh.

Djibouti was also found to have breached DCT’s exclusivity over all container handling facilities in the territory of Djibouti.

The Tribunal also ordered Djibouti to pay DCT $148m for historic non-payment of royalties for container traffic not transferred to DCT once it became operational.

Djibouti was also ordered to pay DCT’s legal costs.

In February 2018, the government

of Djibouti took control of the terminal, arguing the terms of the agreement had been broken and that DP World had underperformed.

In August 2018, an arbitral tribunal of the LCIA ruled that the Government of Djibouti’s seizure of the Doraleh Container Terminal from DP World was illegal because the latter’s concession agreement remains valid.

The tribunal said that further damages are possible if Djibouti develops a planned Doraleh International Container Terminal (DICT) with any other operator without the consent of DP World.

For the latest news and analysis go to www.portstrategy.com/news

THE STRATEGY

BRIEFS

SETBACKS FOR APMT’S LA AUTOMATION PLAN

Singapore reveals Tuas schedule The Tuas Terminal mega port will commence its first phase of operations in 2021 with two berths for ships, the Maritime and Port Authority of Singapore (MPA) has said.

MPA also said the 221st and final caisson had been installed on 23 April, according to Channel News Asia (CNA). MPA said the installation of the final caisson was “critical” as it enabled the completion of the wharf construction and for the first few berths to be operationally ready.

Egypt’s Damietta Port could be one of the first ports globally to use the just-in-time (JIT) concept prior to approval by the International Maritime Organization (IMO), according to the facility’s authority.

Damietta Port Authority (DPA) said that a co-ordination meeting, which included shipping agents and stevedoring firm representatives, saw agreement “to take all necessary measures to ensure quick adoption of JIT and address any obstacles that may arise”.

Confusion on Sudan contract Sudan’s military rulers claim to have suspended a concession contract with International Container Terminal Services Inc (ICTSI) for South Port Container Terminal at Port Sudan, pending its cancellation, the country’s Transitional Military Council (TMC) said in a statement. However, in a statement to Port Strategy, ICTSI said: "ICTSI has not received any official notice of suspension or cancellation from the Sudanese government... and thus will reserve its official response on this matter until then."

8 | MAY 2019

Credit: ILWU

Damietta to make just-in-time history

The Los Angeles Board of Harbor Commissioners delayed a decision for a second time in April on a strongly contested permit for APM Terminals to carry out modernisation work to introduce driverless electric cargo trucks at the Port of Los Angeles’ Pier 400.

In a letter to the Harbor Commission, Los Angeles Mayor Eric Garcetti requested the Commission postpone the vote so that he could have more time to negotiate a deal between APM Terminals and the International Longshore and Warehouse Union (ILWU), which were represented at the meeting by 2,000 protestors

concerned that jobs could be lost if the automation project is realised.

APM Terminals stated: “We appreciate Los Angeles Mayor Garcetti’s leadership on this important matter. After months of delay, we look forward to working expeditiously through the process he’s outlined to make the port competitive.”

The board first voted to postpone the permit to build landside infrastructure to operate driverless battery-electric powered equipment last month, after union officials opposed the plan. ILWU Local 13, which represents dock workers at APMT,

8 ILWU Local 13’s vice president Gary Herrera brought union grievances to the LA Port Commission

voiced its concern that introducing electric automated equipment would displace workers.

At this first voting meeting, Mr Garcetti also requested a 28-day consideration period and offered to mediate the dispute between APMT, ILWU, and Pacific Maritime Association (PMA), which was accepted by APMT. A 2008 International Longshore and Warehouse Union contract, renewed in 2015, explicitly allowed West Coast ports to continue automating.

AUSTRALIAN OPERATORS’ TERMS RAPPED Three Australia stevedores have agreed to change contract terms with land transport businesses after competition regulator the Australian Consumer and Competition Commission (ACCC) raised concerns.

The ACCC conducted an investigation into the contracts held by DP World Australia (DPWA), Hutchison Ports Australia (Hutchison) and Victoria International Container Terminal (VICT) and concluded they could be unfair.

The regulator pointed specifically at contract terms favoured by DPWA and Hutchison which allowed them to vary terms in agreements without notice, including fees paid by land transport operators, and other terms which limited their liability for loss or damage suffered by transport businesses, while not offering the transport businesses similar protections.

VICT’s contract required transport businesses to indemnify VICT for loss or

damage, without a similar obligation in return.

DPWA’s standard agreement required transport businesses to pay the stevedore’s legal costs and expenses, rather than having those costs determined in court.

All three stevedores co-operated with the ACCC investigation, and as a result of their compliance ACCC commissioner Sarah Court said that thousands of transport businesses, which have standard form agreements with DPWA, Hutchison and VICT, stand to benefit.

For the latest news and analysis go to www.portstrategy.com/news

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THE STRATEGY

Having turned down a request from MSC’s terminal arm, TIL, to build a new container terminal in the Port of Montevideo, Uruguay’s National Ports Authority (ANP) has had a change of heart and has put forward an alternative plan for a different location.

Opposition-appointed ANP member Juan Curbelo (National Party) initially voted against the project, insisting the ANP’s technical committee reject it on practical terms.

However, ANP vice president Juan José Domínguez has now revealed that a “political decision” had been taken to accept the new multipurpose terminal project, as long as it was located in a different place.

Katoen Natie, which operates the port’s only dedicated box terminal, Terminal Cuenca del Plata (TCP), opposes the plan, since it believes it will impact negatively on its business. The company has recently been negotiating a concession extension beyond its 2031 expiry date, although its success depends on the investment it will make.

385m

$

penalty applied to the Djibouti government for breaching DCT exclusivity rights

BRIEFS Partial sale considered for Peel Deutsche Bank’s former asset management business is considering selling part of its stake in Peel Ports, in a deal that could value the port operator at £4bn. DWS is considering the sale of a 15% stake in Peel Ports, according to The Sunday Times.

DWS, which has owned 49% of Peel Ports since 2006, was listed

by Deutsche Bank in March 2018.

However, the bank is still a majority shareholder.

10 | MAY 2019

Credit: IMO

URUGUAY BACK-TRACKS ON TIL REJECTION

STOP UNFAIR PORT ACCESS PRACTICES The International Shipsuppliers & Services Association (ISSA) has said its association members continue to experience unwarranted delay, obstruction and unfair charges when they wish to enter ports to deliver stores to ships.

Addressing delegates attending the International Maritime Organization’s (IMO) FAL43, ISSA secretary Sean Moloney stated that port authorities are not co-operating with ship suppliers and failing to adhere to the ISPS Code.

He said the ISSA wanted to “respectfully draw to the

‘‘

We have the ambition to become the bridge between the European Union and China

Greek Foreign Affairs Minister George Katrougalos explains how COSCO’s investment in Piraeus is helping Greece to become a gateway for Chinese products into Europe

8 At the FAL meeting, the ISSA asked for IMO Member States to be reminded to treat ship supply properly

Committee’s attention the lack of co-operation by port authorities in many places with ship suppliers.

“Daily, our members – and we are sure non-members also suffer similar obstruction – encounter unwarranted delays, unworkable time slots for stores deliveries and absurdly high charges by some ports simply to allow a stores truck to enter and go about its lawful business.”

He said that port rules go against what is set out in the ISPS Code and are having an “adverse impact on ship operations” as cargo flow is being disrupted.

The ISSA has requested that Member States be sent a reminder to treat ship supply properly, under the terms set out in the ISPS Code.

“Furthermore, we ask that Member States remind their relevant departments that the ISPS Code is not to be considered as a money-making venture but a coordinated legal framework which has very successfully protected ports and ships globally from any harm as a result of security breaches,” Mr Moloney added.

Batu Ampar to rival PSA Singapore

China secures Bulgaria foothold

Indonesia’s state port operator PT Pelabuhan Indonesia I (Pelindo I) has invested S$115m in the Port of Batu Ampar to raise its competitiveness in a move which may pit it against PSA Singapore. The investment plan aims to enhance cargo handling facilities at the port, reported The Straits Times. Estimated to cost up to $180m, the project will cover over 1,200 hectares, in the Straits of Johor, near Tuas.

China Machinery Engineering Corporation (CMEC) has signed a $135.5m Bulgaria port project construction contract with Logistic Center Varna EAD to jointly develop port infrastructure in Bulgaria’s Port of Varna.

Notable as the first development by a Chinese company in Bulgaria, the project bolsters the country’s European ambitions and will see CMEC take charge of the project as the prime contractor.

For the latest news and analysis go to www.portstrategy.com/news

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THE STRATEGY

BRIEFS

DPW SEEKS BIGGER LATIN AMERICA STAKE

New port targets a sustainable Arctic The development of a new Icelandic port that could enable sustainable development of the Arctic and help to make emergent shipping routes safer is set to offer multiple natural benefits. One of the key drivers for the project at Finnafjord, in the north-east of Iceland, is the potential for creating new prospects for the local population because of the industrial uncertainties that climate change brings.

The Port of Seattle’s Terminal 5 in the US state of Washington is set to “return to use as a premier international container terminal” after both building and lease agreements were approved by the managing members of The Northwest Seaport Alliance (NWSA), the marine cargo-operating partnership of the ports of Seattle and Tacoma. The members voted to give the green light to the agreements and construction in early April, with the NWSA stating in a press release that modernisation of the facility lets the alliance extend cargo-handling capabilities and stay competitive in the shipping sector.

Truckers open fire on surcharges In Australia the latest controversial “port infrastructure” surcharges put in place by stevedores have drawn opposition from truckers. Speaking to The Loadstar, Peter Anderson, Victorian Transport Association (VTA) chief executive, expressed concern on behalf of his organisation over charge-hikes. “The VTA remains concerned at what are essentially ongoing and unregulated increases,” he said.

12 | MAY 2019

Credit: Patricio Avila

Seattle Terminal 5 set for upgrade

DP World is looking at concessions in up to seven Latin American ports in the next year, according to the company’s chief operating officer.

Mahmood Al Bastaki said that DP World “has a big focus” on the region and here are “five or seven ports” in which concession announcements are expected over the course of the next year, Arabian Business has reported..

“It’s all under negotiation,” said Mr Al Bastaki.. “We’d do concession agreements, and we’d prefer longterm ones. A port is a long-term investment. Wherever we go, we do capacity building, we create

jobs for the local economy and local talent has an opportunity to get into a strategic business.”

In January DP World acquired a 71.3% stake in Puertos y Logistica S.A. (Pulogsa) in Chile. Pulogsa operates a long-term concession for Puerto Central (PCE) in San Antonio, in Chile’s Central Region V, as well as owning and operating Puerto Lirquen (PLQ) in Chile’s Southern Region VIII. According to Mr Al Bastaki, who

8 DP World plans to bolster its holdings in Latin America, which includes a stake in Puerto Lirquen

was speaking at the Global Business Forum Latin America 2019 in Panama City, Latin America is a particularly attractive region for DP World because of its relative stability compared with other parts of the world.

Alongside Chile, DP World has a presence in Peru, the Dominican Republic, Argentina and Brazil.

DP World expects to make concession announcements for up to seven Latin American ports

HUTCHISON RAMPS UP INFRASTRUCTURE FEE Port infrastructure charges becoming an issue in the New South Wales state elections has not stopped Hutchison Ports Sydney announcing that its infrastructure levy is to rise.

The opposition Labor party went into the elections at the end of March with a commitment to stop “exorbitant” port charges, with leader Michael Daley and freight spokesperson Jodi McKay stating that landside prices and charges had “escalated rapidly without explanation or justification”.

Their position drew backing from Road Freight New South Wales, which has called for a robust price-monitoring system at the port and an independent body to regulate infrastructure and other landside charges after two years of fighting against surcharges imposed by the stevedores.

However, the incumbent Liberal/ National Coalition Government was re-elected to a third four-year term with a reduced majority. Labor won an increased share of the vote in most districts but was unable to

successfully gain support in key marginal electorates.

Hutchison Ports Sydney announced that its infrastructure levy would increase to A$35.84 per full container after a review of all capital investment revealed that the current rate of recovery will not keep pace with future infrastructure requirements and ongoing maintenance”.

The levy is applied to all full container movements entering or exiting the terminal by both road and rail.

For the latest news and analysis go to www.portstrategy.com/news

THENEWYORKER

COLUMNIST

BARRY PARKER

CONGESTION DRIVES MODAL SHIFTS Road congestion, and its deleterious environmental impacts, could be driving change in supply chains around New York.

While the actions of the New York City Economic Development Corporation (NYCEDC), which is looking to promote barge transportation of freight, are local, they are tied to, and may provide the framing for, an ecosystem for other ports where commerce is mired in traffic.

Importantly, the NYCEDC is co-operating with the local port authority – not necessarily an easy task – and with the US Maritime Administration (MARAD) which continues to push its Marine Highways programme in the face of sometimes strong headwinds from the landside.

The city and the port interests have spearheaded the formation of a coalition called the North Atlantic Marine Highway Alliance with the objective of bringing

11

public stakeholders and private interests together “to assess and develop existing and potential marine highway services that will improve intermodal efficiency within and between major ports”, up and down the US East Coast.

While the story is still being written, there are some promising developments so far. Notably, the

8 Congestion on New York’s streets is accelerating change

NYCEDC – which controls a large part of the Hunts Point Market, a major food distribution entrepôt – has begun the process of seeking an operator for a terminal, not yet built, that would service barges to potentially move cargo around the local region. NYCEDC received a

grant from MARAD last year to study cargo flows around the region and the Hunts Point RFP is a tangible result of this analysis.

The RFP, and the steadily loudening buzz, comes at a time when distribution patterns are moving in a ‘local’ direction and the pallets, rather than 40-foot boxes, are increasingly infused into conference presentations and discussions among decision makers.

Similarly, transportation ‘sustainability’ is on decisionmakers’ radar screens. Private enterprise will do the eventual lifting, but it’s heartening that government is attempting to open the fairway. The roster of the Highway Alliance covers members from Maine (in the north) to Delaware in the mid-Atlantic region. But it also includes carriers with proven track records in coastal barging, who would be eager to serve an even bigger swathe of the Marine Highway.

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For the latest news and analysis go to www.portstrategy.com/news

THEANALYST

COLUMNIST

PETER DE LANGEN

MEETING TOMORROW’S LABOUR DEMANDS Providing a series of training sessions for the European Transport Workers’ Federation allowed me and fellow members of the knowledge dissemination platform www.porteconomics.eu to develop and discuss ideas on the future of labour in ports.

In my case, this took shape in the context of a global discussion on the viability of a ‘post-work’ future. The main claim of the ‘post-work’ advocates is that we need to move towards a society where work takes a less central place. While people will obviously continue to work, the goal of the post-work advocates is a reduction of (average) working hours and, lower levels of inequality and more financial security, even for those who only work limited hours. That may sound ridiculously optimistic, but both automation and the needed transition towards sustainability may force us to rethink the central position of work (and income) in society.

In my view, the case for a shift towards a ‘post-work’ society is very strong, and perhaps less revolutionary than one would think at first sight, given the historical shift towards more ‘free time’ and less ‘work time’. At the beginning of the 20th century, the ratio between lifetime work time and lifetime free time was about 4 to 1,

but by 2040 it is expected to be around 1 to 4 (i.e. four times as much free time as work time).

SHIFTING DYNAMICS Specific to ports – and shipping and a range of other industries – is that port work, certainly at terminals, is shift work. Employees work in different shifts, often three, one of which is the night shift. Shift work, especially over a sustained period of time, has

Shift work, especially over a sustained period of time, has proven to have very negative health effects, and is associated with a reduced life expectancy

THEEDITOR

proven to have very negative health effects, and is associated with a reduced life expectancy.

Keeping this in mind, the most attractive principle for port work would be to regard it as the main income generating activity over the life-span of a port worker, but at the same time secure it as temporary, in the sense that there is a maximum period (say 20 years) and/or a maximum age (say 50) for port workers.

Ideally, port workers would earn a ‘lifetime living wage’ (i.e. as much as the median person earns in a lifetime) with 20 years’ employment in the port. While current port workers may rather earn more than work less, this model would be fair in the sense

8 The unsociable working hours of ports could be revisited

that it provides opportunity for more workers to earn a ‘lifetime living wage’ in 20 years. At the same time, it would from the outset provide clarity about the reduced time span of port work and prepare port workers better for the period after working in the port.

This idea may sound utopian but in quite a few countries, such as Sweden, the US and France, the accumulated earnings of a 20-year employment in the ports industry are close to or more than the nationwide median lifetime income. In other countries, fiscal or pension measures could make sufficient lifetime earnings viable.

COLUMNIST

CARLY FIELDS

GOING UNDERCOVER FOR PORT INSIGHT Port Strategy magazine is starting a new ‘undercover rePORTer’ section in the magazine featuring cuttingedge, but crucially anonymous, opinion from the experts in our wide top-level audience.

We are encouraging thought leadership, deep-mined insight

and topical coverage of issues that our experts have a unique handle on.

We welcome contentious and thought-provoking articles from all walks of the port environment, be that on the dock, service providers to ports, supply

For the latest news and analysis go to www.portstrategy.com/news

chain players, shipping lines or equipment providers.

Please contact me directly and confidentially on editor@portstrategy.com if you have a pressing issue that you would like to cover anonymously in the future in Port Strategy magazine.

UNDERCOVER REPORTER MAY 2019 | 15

THEECONOMIST COLUMNIST BEN HACKETT

Shipping companies and ports are currently in somewhat of a quandary; they face criticism that ships are too large or too small, that alliances are harmful to customers and service providers such as ports, that they sail too slow but face environmental pressures suggesting that they sail to fast, and that they arrive too late or too early in ports.

The list goes on, but the question is, who is right and who benefits from the oxymorons implicit in the criticism?

Currently shippers, forwarders and the OECD are fighting the extension of exemptions given to alliances by the EU Directorate of Competition. The argument is that alliances provide poorer services due to slower steaming and network port call rationalisation and that this leads to higher prices. Hello? Has anyone seen the freight rates on the main shipping routes or the financial returns of many shipping lines?

Do we really want to abandon large ships, be they crude carriers, bulk carriers or containerships, in favour of smaller, less economic ships working outside of alliances with too many calls at ports?

Where is the efficiency in that?

Where does improvement in

Credit: John Fielding, CC BY 2.0

SEA OF CHANGE OR STORM IN A TEACUP?

service levels come from if shipping companies are told to reduce speed to avoid further climatic changes while at the same time being told that ship service speeds are too slow, and how do ports manage with a rapid increase in the number of ships calling and the need for a mass of contracts and increased efforts by all to carve out cost savings?

THESTRATEGIST

All this in a period where there is pressure to shift to liquefied natural gas fuel as part of the legislation for cleaner emissions from 2020 onwards. It seems to me that these seas of change are indeed creating operational issues for the industry. Ports need more quay length for the bigger ships and even more if the push to end alliance exemptions were to come

8 Where is the efficiency in abandoning large ships?

about, which would reduce ship sizes were it to succeed.

The knock-on effects of any changes could be far-reaching and all possible results must be considered before a decision is reached on reversing the EU liner exemption.

COLUMNIST

MIKE MUNDY

WATCH OUT FOR THE CYBER CRIMINALS The Transport Asset Protection Association (TAPA), a global organisation made up of security professionals, manufacturing and transport organisations and which has the stated aim of minimising cargo losses from the supply chain, highlights how criminal syndicates are turning to technology to achieve smooth passage for illegal goods.

A position paper authored for TAPA by Kirsten Williams, political risk analyst, Europe & Russia, Allan & Associates, highlights how criminal organisations are turning away from old methods

16 | MAY 2019

of clearing goods through ports such as corrupting port officials or planting low-ranking “soldiers” in docks and terminals in favour of IT-based clearance systems which often give a much better oversight and ability to manipulate clearance procedures.

Ms Williams particularly cites three technology elements that are now deployed by criminals – spyware, malware and ransomware.

In the case of spyware she gives the example of Dutch drug traffickers that hacked the computer systems of two container terminals allowing them to track selected containers

and schedule unloading at a time and place of their choice.

This activity can also be accompanied by gangs breaking into the offices of port companies and installing key loggers, miniscule computers inside electrical power strips, and external hard drives on computers.

This enables them to steal log-in information and ultimately locate and track containers.

With malware – malevolent software – the example is given of China-based hackers infecting handheld inventory scanners used by logistic companies.

Among other things it served to

collect logistics data such as origin, destination, content of shipment and value, and relayed all this and other information back to China.

Ransomware Ms Williams cites as a growing threat to ports. She describes it as “…a type of malware that encrypts information held on systems thus disabling them and only releasing it for a fee.

With all three types of ‘attack’ the view is held that many more parties have suffered at the hands of this sort of criminal activity than have owned up to it. Definitely, therefore, an area worth some detailed attention.

For the latest news and analysis go to www.portstrategy.com/news

THEENVIRONMENTALIST COLUMNIST CHARLES HAINE

ENERGY INITIATIVE The European Union’s Energy Efficiency Directive prompted initiatives such as the UK’s Energy Savings Opportunity Scheme (ESOS), now celebrating its fifth birthday. Capturing any port with more than 250 staff or turnover above €50m, ESOS requires an audit every four years. There's a rush on Phase 2 audits now as the resulting report needs to be submitted to the regulator by December 5. While there is a £50,000 fine and naming-andshaming for non-compliance – there were 300 victims in Phase 1 – firms must surely see the benefit in such audits for the tangible savings they identify.

GET SET FOR ENERGY SAVINGS

Credit: National Renewable Energy Lab, CC BY-NC-ND 2.0

The surge in awareness towards accelerated action on climate change and Governments and companies seeking transition to carbon neutrality both require tackling the challenge of rising energy costs Carbon taxes are not yet anchored in all legislation but there are mechanisms, such as levies, and plenty of measures in the pipeline to make us think differently about energy.

From working in container terminals and mixed-use ports, it’s evident that a rigorous audit of energy consumption, by source and activity, is of utmost importance. It helps to inform legal requirements, save costs through identifying where to use less fuel and electricity, and allow better planning for investment in more modern, energy-efficient hardware.

For some terminals, the realisation that yard, buildings and security lighting comprises only, say, 2% of energy (kWh) used means that capital expenditure is better spent in new technology elsewhere. Electric ship-to-shore cranes are usually around the 5% mark of overall consumption, with the dominant areas typically being diesel-powered mobile machinery (up to 50%) and reefers (I have seen 10% to 55% of consumption, depending on the continent you’re in). Cruise terminals also tend to lean towards the heavier end of consumption in the energy consumption pie chart.

8 Energy audits can help ports cut costs and emissions

Navigating the scope, in terms of the complexities of organisational structure and the myriad of operational activities carried out in ports, is a prerequisite. If prepared by a properly qualified energy specialist, the audit and report will identify priority energy-saving opportunities.

Taking a 360⁰ view, you will be provided with quantified energy and cost savings for each measure proposed. These will include a prioritised list, from the low-hanging fruit (such as

adding circuitry/switches to reduce consumption; anti-engine idling policy and enforcement) with quick returns on investment through to longer-term investment (such as solar power on roofs). A port is then equipped to take decisions based on data. This might be displaying energy certificates, becoming certified to ISO50001 (energy management systems) or ramping up the annual reduction target. Of course, the benefits are multiple: cost savings from eliminating wastage (often up to around 30% in ports), a more-balanced

From working in container terminals and mixed-use ports, it’s evident that a rigorous audit of energy consumption, by source and activity, is of utmost importance.

It helps to inform legal requirements, save costs through identifying where to use less fuel and electricity, and allow better planning for investment in more modern, energy-efficient hardware

For the latest news and analysis go to www.portstrategy.com/news

energy portfolio and a lower carbon footprint.

The ESOS approach is driving change in terminals. We have seen more granular tracking of port machinery, the timed pre-warming of mobile equipment, maximising use of hardware with regenerative capacity (for example cranes), timed heating and recovery in heating/ventilation/cooling systems and the design of terminal extensions using A-rated plant. The opportunities may well run into the hundreds although the priorities are different in each situation.

The audit makes complete business sense and can be prepared with almost no disruption to cargo handling activities. A quick notepad calculation will tell you that a 5%, 10%, or in some cases 40% saving on those annual fuel and electricity bills will be very attractive, no matter the size of the port.

8 Charles Haine is technical director, maritime, at WSP.

MAY 2019 | 17

TECHNOLOGY: BLOCKCHAIN

FORGING LINKS BETWEEN DISPARATE BLOCKCHAINS Maersk’s TradeLens might be a frontrunner, but it’s not alone in the sprint for blockchain domination. Antwerp is at its heels with its geofenced pin pick-up offering, while Tristar has focused on shoring up transparency and security in the warehousing and logistics side of the business. And there are many more contenders working on blockchain pilots or proof of concepts, ensuring that victory is far from guaranteed for TradeLens.

There is good reason why so many maritime industry players are developing blockchain platforms in parallel: profit. It is thought that the first viable blockchain set-up will be adopted throughout the supply chain, and the company which administers it will reap huge financial rewards. But one of the questions surrounding development of this technology is what will happen if every company develops its own version.

Late last year, the Port of Rotterdam embarked on a blockchain pilot project in collaboration with ABN AMRO and Samsung SDS, which was due to conclude in February 2019. A stated aim of the project was to integrate disparate types of systems in a practical fashion. Rotterdam chief financial officer Paul Smits commented: “Currently payments, administration and the physical transportation of containers still take place entirely via separate circuits, [which] results in inefficiency as many parties are involved and everything is organised via paper documentation...an average 28 parties are involved in container transport from China to Rotterdam.”

Since then, this project has unveiled Deliver, a new system to integrate these various processes with blockchain, but also connect disparate blockchain platforms, preventing double payments and enabling users to transfer assets. Deliver was unveiled by Samsung SDS at a Korean logistics conference in March.

"The Customs Clearance Blockchain System at the Korea Customs Service is based on Hyperledger Fabric, while Rotterdam Port in the Netherlands is using the Ethereum Platform," said Han Seung-Yeop, manager at Samsung SDS. “We started the Deliver project to connect different platforms."

Deliver is now being used for export customs clearance and has been used successfully for containers moving between Korea and the Port of Rotterdam. “Deliver will be the starting point of a trust society based on super-connected chains where different blockchains are interconnected on the Delivery platform,” Mr Han claimed.

TRADELENS DEVELOPMENTS In 2017, Maersk Line and IBM embarked on a project to digitise bills of lading using blockchain. Paperwork can make up as much as half the cost of a low-value container, and Maersk estimated at the time that to eliminate it could potentially save the container industry $38bn annually.

In mid-April, Tradelens received a robust vote of confidence when a Maersk rival, Israel’s ZIM, signed up to use the service for its own cargoes. It became one of only two non-Maersk affiliated customers to do so, the other being Pacific International Lines (PIL). In a statement, TradeLens head Mike

18 | MAY 2019

Credit: Frans Berkelaar

A digital ledger offers undeniable benefits of improved transparency and security, but which project should ports back, asks Charlie Bartlett

White was eager to stress that the service would “deliver... benefits while still allowing carriers like ZIM and others to maintain their competitive advantages”.

At the same time, TradeLens garnered a new ecosystem partner – as distinct from a paying customer: Canadian customs broker Livingston International. Mr White added: “The more carriers and other ecosystem members that join the platform, the closer we come to bringing about a new era in global trade.”

“We have always prided ourselves on being a forwardthinking customs broker and trade-services provider,” said Craig Conway, chief technology officer for Livingston International, at the time of the announcement. “We are excited to be working with Maersk, IBM, CBSA and other members of the TradeLens ecosystem on an initiative we believe will serve our industry well and provide transparency and security in the global movement of goods."

“The current number of ecosystem partners is a little over 100.

These include ports, customs authorities and freight forwarders,” explains Mikkel Elbek Linnet, Maersk Line spokesman.

At time of writing around 20 ports are signed up to the service, including PSA Singapore, International Container Terminal Services Inc, Patrick Terminals, Modern Terminals in Hong Kong, Port of Halifax, Port of Rotterdam, Port of Bilbao, PortConnect, PortBase, and terminal operator Holt Logistics at the Port of Philadelphia.

GETTING SMART Dubai-based downstream petroleum and chemicals player Tristar provides land- and sea-based logistics throughout the Middle East, Africa, Central America and Asia. In 2017 it embarked on a blockchain pilot project.

“We started with a proof of concept for our warehousing and distribution business,” explains chief executive Eugene Mayne.

“The point of having blockchain is to provide full visibility to the customer – details on when the material comes into the warehouse, where it is stored, what time it is loaded.

8 Rotterdam is working on an initiative to connect up different blockchain platforms

8 Tristar’s Eugene Mayne wants its blockchain offering to provide full cargo visibility to the customer

For the latest news and analysis go to www.portstrategy.com/news

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TECHNOLOGY: BLOCKCHAIN

“There is no paperwork – customers can communicate through the app. The final step for us will be to implement smart contracts, which can facilitate agreements with the customer with no further validation required.”

Arguably more important than straightforward cost-savings, though, are the benefits of transparency. In recent months, container shipping has faced an epidemic of fires, thanks to a lack of clarity on the contents of containers. Many shippers are unwilling to pay a premium for hazardous cargoes, such as calcium hypochlorite, which must be placed on the outer corners of a ship’s container stack, and so deliberately misdeclare it.

8 Each cargo move generates a sizeable paper trail

Obviously, the logistics of container terminal operations prevent wide-scale box inspection and antitrust law limits the extent to which container lines are able to take meaningful action to share information. Moreover, carriers cannot nameand-shame customers to other lines. In 2017, the New York-headquartered National Cargo Bureau (NCB) managed to inspect the contents of 31,000 containers. For an individual

agency, this represents admirable diligence; but for a major container port like Shanghai, it is less than a third of a single day’s trade.

This is another area where blockchain could come into its own, since centralising the information in a digital ledger would allow shipping lines to access information on the container’s origin, contents, and destination as a prerequisite of passage.

This would make it much harder for a shipper to get away with mis-declaring its contents.

THE LAST BIG HURDLE Although it has long been clad in a the language of safety, with a decentralised database, trusted partners and so on, a blockchain network is still accessed in the same way as any digital system – through a computer, which may not be secure.

Indeed, today’s market is ready for blockchain in almost every aspect apart from one: that of trust. Despite considerable benefits for users even at this early stage, and the collaboration with so many partners in terms of its ecosystem – a large number of whom are required for a network to be effective – Maersk’s TradeLens still boasts relatively few paying customers.

“A couple have joined, two or three,” Maersk’s Mr Linnet explains. Clearly, rival shipping lines are unwilling to join a network administered by one of their competitors, however well-intentioned it may seem.

So while the barriers between platforms are being broken down, the counterproductive hype cleared, and many of the other start-up issues now being ironed out, if blockchain is to gain wider acceptance its biggest hurdle is not technological, but psychological. “The biggest challenge we have now is that systems have to talk,” explains Tristar’s Mr Mayne. “For this to happen, people have to let go.

Some people don't want to let go, and this is the bottleneck.”

8 TradeLens now has around 20 ports signed up to the service

8 Maersk’s Mikkel Elbek Linnet puts the number of TradeLens ecosystem partners at just over 100

Looking to the local dimension In Antwerp, a convoluted system reliant on bills of lading – one often taken advantage of by cargo thieves and smugglers – is eagerly being replaced with a blockchain system. A truck driver presents a carrier-generated PIN code relating to a specific container.

The PIN code can be emailed, faxed, or sent by SMS, and is routinely known to more

20 | MAY 2019

parties than necessary; it can be intercepted by criminals in a variety of different ways, particularly if one of the computers involved is hacked.

But with a comprehensive history of everyone who has accessed the service, and relevant credentials required from all parties who update the ledger, it becomes much harder for the wrong people to get access to the relevant information. Antwerp has also added a local

dimension, a ‘geofence’ that stops the ledger being accessed from outside the relevant terminal.

With the pilot project completed, Antwerp is now looking to commercialise the product and make it available to other terminals. But with Maersk and IBM’s system gaining traction, at least in terms of port operators, it has plenty of competition.

For the latest news and analysis go to www.portstrategy.com/news

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TECHNOLOGY: FRAUD

IF IT LOOKS TOO GOOD TO BE TRUE, IT PROBABLY IS Fakes, forgeries and misleading claims; ports and shippers would do well to question things more often. Felicity Landon reports

8 Customs inspectors have been cracking down on fraudulent container declarations

From fake websites to ferry services that evaporate, from undervalued imports to fraudulent goods – it seems that there are plenty of things not to be believed.

Earlier this year, the Port of Rotterdam Authority warned that criminals regularly set up fake copies of its website to lure existing or potential clients into disclosing confidential information or paying fraudulent invoices. It also warned of websites set up for ‘storage spoofing’ – the sale of non-existent storage capacity, raw materials or other stocks, which the criminal claims to hold at terminals in the port area.

Philosopher and author Professor Anthony Grayling says that accepting things at face value is partly laziness and partly because we all have so much going on in our lives. Think of the ‘mad cow map’: doing the rounds a few months ago, it was drawn up to suggest that mad cow disease was most prevalent in areas of the UK that voted to leave the European Union. It was a claim believed by many.

“People sit down for a few minutes with the paper, have a quick read and don't question things. We really need to sharpen up, be prepared to dig into things and ask more questions generally,” says Prof Grayling.

UNSUBSTANTIATED CLAIMS A controversial example of untruths can be found in some campaigns against port developments.

“Developers must have back-up evidence and studies for their planning applications, but the fact is that certain stakeholders don’t have this requirement in the same way,” says British Ports Association chief executive Richard Ballantyne.

“There is the ability for campaigners to make claims that are not substantiated, that may inform consent bodies and cause delays. And sometimes it is a case of whoever shouts loudest.”

He refers to more than one case where campaigners used

22 | MAY 2019

unsubstantiated claims and untruths, and pursued them aggressively to the point where the entire debate became so highly politicised that the plans were scaled down. Other objectors have been “quite adaptable” in their campaigns, switching the reason for their objection from one topic to another quite different one. Added to this, social media campaigns are so instant and easy, he points out. “You can just put things up on social media – of course, a lot would be well researched and backed by evidence, but there isn’t any kind of safety net to ensure that these claims are corroborated.”

Add to this the fact that coastal communities often include retired professionals or people with experience in campaigning or technical issues – and if they come onboard, it can be quite a formidable group of stakeholders.

“We can whinge about it and say it’s not fair but the challenge is to take stakeholder relations and communication to the next level,” says Mr Ballantyne. “Traditionally trust ports have been very good at this because of their public accountability and their requirement to be open to key stakeholders. But gone are the days when a purely commercial CEO is needed. Now CEOs are more adaptable and balancing commercial experience with political and stakeholder management skills.”

INSPECTION RISKS Customs authorities seeking to crack down on fraud in the supply chain carried out a trial in which containers were selected and taken for inspection at an inland pre-clearance facility in the UK. The result: high levels of non-compliance were found, including undervalued, mis-described and misclassified goods. The inspection system is now part of HMRC’s business-as-usual activity.

According to one source in the industry, the trial found non-

For the latest news and analysis go to www.portstrategy.com/news

compliant loads ranging from £30,000 to £80,000 undervalued.

“We are talking about goods coming into the UK, so being cleared for the UK and the European Union and then going out to Spain, Italy, France, and so on,” he says.

Customs may try to prevent it but it continues to happen, he says. Bizarrely, it seems quite open in some ways. For example, a trailer parked up had its curtain-side slashed and goods were stolen. The value of the contents of the trailer had been declared at $10,000. The agent involved said they wanted to claim for the lost goods – to a total value of $50,000.

After the inspection trial, HMRC wrote to businesses offering Customs brokerage or shipping services to importers, warning them that they may be targeted by fraudsters simply to carry their goods into the UK. “It is in your own interests to take appropriate steps to protect yourself from potential fraudsters to avoid the risk of becoming jointly and severally liable for any debt accruing from a false declaration,” said the letter.

It added: “We strongly advise you not to ignore this advice.

We realise that you will already have a range of controls in place, which will include risk management checks when you do business with a new customer or supplier. Given this new threat, we advise you to review your existing processes to ensure they can protect you against this risk and, if necessary, update your compliance and risk systems.”

The source says: “Of course we have due diligence in place but we are warehouse operators. We don’t have the value of everything – what can we do?”

False claims of origin are also an issue. A recent tribunal

Credit: Port of Rotterdam

TECHNOLOGY: FRAUD

decision relating to the origin of some garlic was outlined in the HMRC’s international trade newsletter. The garlic had been declared as having originated in India rather than China. The reason for this falsification was because it breached the quota from China and would have been liable to an amount of €1,200 per tonne in addition to the 9.6% duty.

The appellants, required to pay the higher amount, appealed against this ruling. “There were a number of innocent parties caught up in this deliberate scam,” says the newsletter. “The fact that they relied on documents subsequently found to have been falsified or inaccurate was not in itself a reason for their import duties to be repaid. Their appeal was dismissed.”

HMRC concluded: “This case highlights the risk of lack of due diligence or failure to ask yourself ‘does this look too good to be true’?”

8 Rotterdam has warned customers about fake versions of its website

The mysterious tale of Seaborne Freight in the UK demonstrated that not everything is necessarily what it seems.

In December 2018 the UK’s Department for Transport (DfT) awarded a £13.8m contract to Seaborne Freight to run a ro-ro freight service between Ramsgate and Ostend in the event of a no-deal Brexit, to take the pressure off Dover. However, it emerged that the company, formed in 2017, had never run a service and did not have any ferries. In February the UK government ended the contract, after Arklow apparently withdrew its funding; but in March, it emerged that the DfT had not held any face-to-face meetings with Arklow.

Less publicised but equally baffling was an email sent to shippers earlier this year advertising a freight-only ‘Brexit-relief shipping route service’. The email, from Sea Freight Europe GmbH, based in Amsterdam but also with office addresses in London and Harwich, invited people to ‘purchase [slots] in advance either for safeguarding or investment purposes’.

The email announced that for 180 days from March 30, the company would be running services between Ipswich and Moerdijk – a ro-ro service for up to 70 vehicles per vessel and a container service for up to 750 teu.

The email gave details of prices and stated

Credit: Port of Moerdijk

Mysterious ways

“initial purchasing is in advance”, inviting potential customers to submit details of journey route, date, number of vehicles/ containers and booking name, so that an invoice could be raised.

Shortly afterwards, a notification appeared on the company's website “apologising for any confusion” and stating that: “The journey route planned for Moerdijk to Ipswich region was only ever a provisional option, designed to engage with industry professionals to determine the interest in a Holland/Belgium to East Anglia route during a period immediately after a ‘no deal’ Brexit’.”

The website stated: “Both Ipswich and Moerdijk were locations that were strategically positioned to allow us to enter into negotiations with a variety of port providers simultaneously, negotiations that were designed to be supported with evidence of interest in the route.

For the latest news and analysis go to www.portstrategy.com/news

8 Moerdijk was one of two ports erroneously connected to a tentative new ferry route

At no time however did we enter into a commercial contract with either port provider (ABP or Moerdijk Port Authority).

“Gauging the interest level in this service was designed to enable us to bring leverage in our discussions with said port providers, both to persuade them to accept a new market entrant, and also to negotiate better terms for hauliers during the ‘no deal’ period.”

A call to ABP Ipswich revealed that there had been no approach to the port. One warehousing and transport company director locally received an email from the same email address offering up to 7m square feet of warehousing in Suffolk and Norfolk. “I’d certainly like to know where that is,” he says.

MAY 2019 | 23

CARGO HANDLING: PERSONNEL

BRINGING PEOPLE ALONG FOR THE TECH RIDE

Credit: Wolfgang Klein CC-BY-SA-4.0

Automation and AI are pushing forward but, as Stevie Knight asks, what happens to the workforce?

LEAVING WORKERS BEHIND But according to Andy Feakins of Impact People Strategies, new technology-related demands stand to leave a swathe of older workers behind – despite well-intentioned retraining programmes. Mr Feakins is blunt: “The skillsets required for automation are of a new age, needing a tech-savvy generation.

So it’s extremely unlikely that your veteran stevedore will transition across.” Furthermore, he doesn’t necessarily expect other industries to readily absorb those that find themselves out of a job.

24 | MAY 2019

It’s a point picked up by Harley Shaiken of UC Berkeley, who sees a far-reaching problem on the horizon: “The issue isn’t new. But with AI, we are on the cusp of creating some very large scale displacements, and this time around, it is profoundly different.” He adds: “While this may be further off than generally expected, we are looking at technologies that will impact all sections of the economy, from attorneys to forklift drivers: eventually there won’t be an industry to accommodate the displaced workers.”

So, how’s it going to be handled? There are some interesting views being aired across the industry: according to one insider “there are people saying we can’t have a shutdown of the kind we saw on the US West Coast in 2015, there has to be dialogue.”

He adds that a number may be considering a collaboration between operating companies and unions that goes beyond traditional labour agreements.

Credit: NearEMPTiness CC.4.0

There’s no doubt: smart technology is proving a doubleedged sword. For some, this is an exciting, if edgy, time with the potential for ‘human-plus’ innovation to enhance port and supply chain capabilities.

Training at Rotterdam’s Living Warehouse Lab is currently centred on wearable tech for warehousing operations, covering everything from Cobotic exoskeletons to Google glasses, Hololens and Progloves. Companies bring in their new technologies and find out what happens when people are exposed to them, while students learn about the latest tech in an adaptive capacity.

Maurice Jansen of Erasmus UPT explains that schools have a crucial role to play in raising a generation of people with this ability. However, he is clear that “you put people, not the technology, at the centre... otherwise you risk training for work which might not be there anymore”.

But not everyone is excited about new tech and there are inevitable labour-related objections. To counter this, the Human Port Capital Programme brings together authorities as diverse as Singapore and Barcelona in an attempt to carve a path through: “The challenges of the energy transition and digitisation can only be met if we also focus on the social transition,” pointed out Rotterdam Port’s chief executive Allard Castelein at the programme’s launch. Indeed, it’s looking to embrace initiatives such as lifelong learning and enabling tech start-up communities, making the most of the sustainable supply-chain movement.

8 Automation continues to overhaul tired port operations

For the latest news and analysis go to www.portstrategy.com/news

CARGO HANDLING: PERSONNEL

LA MOVES These deliberations may come a little late for Los Angeles. APM Terminals is attempting to transform Pier 400 into its third and largest fully automated terminal – with consequent job losses.

The operator faces objections not just from the union, but from the port's board, and at first glance, it doesn’t appear there’s much ground for co-operation. But as Commissioner Diane Middleton underlined, the state Clean Air act proves that the port already has experience of extracting a win-win from conflicting requirements, adding that “new technology doesn't have to be on the backs of jobs or our standard of living”.

However, she points out that it is a far broader issue: “What’s the future of work in America, how do we implement technology without destroying ourselves?”

This is something that Prof Shaiken has been considering for some time. He believes we need a “different kind of accounting” that takes into consideration the effects on community and economy. While he says that “there’s no single magic bullet” he advocates tying automation and AI to “shorter working weeks, without a reduction in pay... and a share of the productivity gains to those impacted”. That way, he adds, the economy benefits from the higher efficiency, “while on the flip side, no reduction in pay means no reduction in purchasing power”, which keeps communities alive.

So how could this, or other initiatives, be funded? Despite seeming whacky at first hearing, a so-called ‘Robot tax’ has been proposed by personalities as diverse as Stephen Hawking and Bill Gates. It might be the best answer on the table right now: “It could work” says Prof Shaiken: again, it’s not an easy sell “but it could prove the least painful solution, given the unaddressed cost of social dislocation”. It could also shine a light on systems which stand to reduce productivity rather than raising it.

TIME TO ADAPT However, according to Mr Feakins, “the evolution is irresistible... and ports that try to avoid it will eventually wither and die”.

While he admits the crane moves of fully-automated terminals generally leave something to be desired, he believes “in time this will change”. Further, he adds: “You have to look at the entire operation, you can lose on one part but gain on the whole... plus it works 24/7 and you get no sickness or health issues.”

However, as Prof Shaiken underlined, while technological advances may be inevitable, we have a useful lesson from

Credit: Erasmus UPT

While Prof Shaiken points out: “Historically, that’s going to be a tough sell,” he adds: “That doesn’t mean it’s not a good idea.”

nature: the pace of change could, perhaps should, be slowed enough to give the surrounding human communities – the ‘ecosystem’ – time to adapt.

Although technology could help deliver a brave new world, don’t take that for granted: if we make the wrong decisions now it could all turn very sour.

Even systems that initially looked like solving some of the myriad challenges are now creating a few of their own.

Take flexible working hours, an offshoot of the ‘always connected’ society: “People sign in and make themselves available by phone, the whole platform is built on flexibility... but not care. And, at present it's highly unregulated,” says Mr Jansen: “This is a growing issue especially for drivers and warehousing staff. At present the temporary agencies have a strong position, but they could be circumvented – by a software app.”

He adds: “Finally, you have to ask, is it socially sustainable?”

Mr Jansen explains: “Often those that choose flexibility are young – for them, it’s a deliberate choice.” But, he says, alongside those will be another set of people that stand to have their earnings damaged by this development. “If these unregulated platforms work their way up through the logistics chain, it could degrade the whole social contract. And you could get to a position where, for example, there’d be no bank loans for van drivers.”

8 Students at Erasmus can learn about new tech in an adaptive capacity

Reinforced bias risks No-one can dispute that the nature of work is changing and more roles will open up for those that can drive data, not cranes. There’s also a whole world of cross-platform skills that could bring logistics and IT together.

“The critical element here is how to connect data with planning decisions,” says Erasmus’ Maurice Jansen. It stands to benefit everything from container positioning in the yard to whole swathes of the supply chain.

Are these IT roles more likely to go to men, and not women?

You might think that we are getting past

that kind of distortion, but the very AI relied on to level the playing field might only end up reinforcing bias and also, by allowing ‘the-computer-says-no’ answers to become acceptable, put responsibility out of reach.

The reason is simple: unchecked, machine learning merely reflects the status quo – and then distils it, until you are left with a concentrated version of any and every existing prejudice.

Both these points are gaining international attention: the ILO global commission on the future of work, chaired by Cyril Ramaphosa,

For the latest news and analysis go to www.portstrategy.com/news

president of South Africa, and Prime Minister of Sweden, Stefan Löfven, notes that “the platform economy could recreate 19thcentury working practices... Left to its current course, the digital economy is likely to widen both regional and gender divides”. Therefore, it recommends regulation and “adopting a ‘human-in-command’ approach to artificial intelligence that ensures the final decisions affecting work are taken by human beings”.

In short, we need to ask some difficult questions – now – about the kind of working environment we are creating for our future.

MAY 2019 | 25

SERVICES: CARBON CAPTURE

OFFERING A SAFE HAVEN FOR CARBON STORAGE

Credit: Peterhead Port Authority

The move towards carbon capture is gathering pace and ports are playing their part, as Felicity Landon reports

Thirty-five percent of all the natural gas used in the UK comes onshore at St Fergus Gas Terminal in North East Scotland. Now the terminal is being lined up to play a central role in the capture, storage and processing of carbon dioxide.

But this is just the start of the carbon capture and storage (CCS) ambitions of the ACT Acorn project. Further down the line, the Port of Peterhead has been earmarked as a UK hub to facilitate CCS; the project partners envisage that 16m tonnes of CO2 a year could be imported through the port, which has been singled out for its close location to existing North Sea pipelines and infrastructure.

That CO2 could come from around the UK and also from mainland Europe.

The ACT Acorn project has eight European partners, led by Aberdeenshire company Pale Blue Dot, a specialist in carbon capture, utilisation and storage. Steve Murphy, finance director at Pale Blue Dot, says that while the idea of CCS has been around for a long while, finding the appropriate investment has generally been a challenge.

That may be changing: “Climate change and the desire to do something to mitigate the damage from it has become really much more mainstream. Investors and funds are disinvesting in some oil and gas activity. For example, the World Bank is not funding coal-fired power stations, we have seen school strikes over climate change, and the area is ripe for shareholder activism.”

FUNDING SOURCES ACT Acorn is recognised as a European Project of Common Interest. It received funding from the UK Government’s Department for Business, Energy and Industrial Strategy, the Research Council of Norway and the Netherlands Enterprise Agency, with co-funding by the European Commission under

26 | MAY 2019

8 The Port of Peterhead has been earmarked as a UK hub to facilitate carbon capture and storage

the Accelerating CCS Technology (ACT) programme, part of the European Horizon 2020 programme.

At the end of February, initial research work and a report on ‘deliverables’ were completed. More European funding was granted for a study which was finished on March 29 – significant as the original date when the UK was due to leave the EU, to avoid any complications of an overlap.

“We have been awarded some further funding from Europe to do the next phase of development studies and have the opportunity to apply for some funding to do actual physical works; unfortunately, at the moment it is hugely dependent on what the outcome is at Westminster,” says Mr Murphy. “The funding would be beyond studies, to support fabricating, building and installing. Of course, various funding is needed Europe will only provide a proportion of funding, typically 50%, so co-funding would come from the industry.”

However, he says, industry needs some visibility on making its money back – and that is now in the hands of the UK government. “We are working on the basis of the first injection of CO2 in 2023-24, and expansion to shipping CO2 into the port

‘‘

16m tonnes of CO2 a year could be imported through Peterhead, which has been singled out for its close location to existing North Sea pipelines and infrastructure For the latest news and analysis go to www.portstrategy.com/news

SERVICES: CARBON CAPTURE

STORAGE SITES The first phase of the ACT Acorn project would involve capturing CO2 directly from the St Fergus site, sending it offshore via existing pipelines due for decommissioning, and storing it in sites under the North Sea. Screening around three strategically important pipelines has revealed at least 16 suitable storage sites. The most promising two could provide a storage resource for over 650m tonnes of CO2.

It is estimated that the reuse of legacy oil and gas infrastructure as part of the CCS project will save around £548m compared to the cost of new build.

In the next phase, redundant onshore transmission pipelines could be used to bring CO2 to St Fergus from further south in Scotland.

After that, the project is looking at the potential for hydrogen manufacture at St Fergus as an initial step in decarbonising gas in the UK. Natural gas would be used in steam methane reformers to produce hydrogen whilst capturing the CO2. The hydrogen could then be exported in the gas transmission system or used locally, whilst the CO2 created during the process would be transported and stored offshore.

“As an important natural gas import facility, with access to nearby CO2 storage facilities and three redundant (but reusable) offshore pipelines, St Fergus is a great location to initiate hydrogen production by decarbonising natural gas,” say the project partners.

The Port of Peterhead comes into the next phase. The report

by ACT Acorn set out plans for importing CO2 by ship and transferring it by pipeline via Peterhead Power Station to St Fergus in a new pipeline.

PLANT LIFE Spain’s Port of Melilla, situated in North Africa, has been leading the way in a novel approach to CO2 capture – via plant life. The port authority was the lead partner in Nereidas Protocol, a European Union TEN-T funded project looking at ways of reducing CO2 emissions in port expansions.

Melilla was chosen as a useful case study for the entire Mediterranean region, as the quality of the water, temperature, salinity, sea currents and biodiversity are similar to that of other ports in the Med. Nereidas was based on the concept of planting and recovering autochthonous Mediterranean marine communities, which would then protect other species that are exposed to the effects of port activity.

Credit: Peterhead Port Authority

behind that, probably 2030 but it all depends on the Government's decarbonisation strategy.”

The project tested Cymodocea nodosa, a seagrass, and Ellisolandia elongata, a calcifying coral weed, planting the species on the seabed around the port and on breakwaters and other structures. The planting was also backed by a biodegradable support, to enable a large amount of filamentous and invertebrate algae to settle and small fish from rocky beds to thrive, encouraging biodiversity as well as CO2 capture.

“We have a pilot plantation for this project. It isn’t about introducing a strange species anywhere to capture CO2 but thinking about the right species for any particular area,” says Jaime Bustillo Gálvez, head of strategic planning at Melilla Port Authority. “The aim is to reduce the CO2 footprint of a port, through recovery of the seabed surrounding the port, using species that have a very high potential for CO2 capture.”

Carmen Pitarch Moreno, head of the port’s quality, environment and risk prevention division, says: “Melilla isn’t a big port in comparison with others but we are focusing a lot on the environment. We have achieved a lot, and the Nereidas project is just one example.”

The Nereidas project was set up to create a standardisation tool that regulates compensatory measures to minimise the effects of transport and port activity. It uses a combination of techniques and procedures that allow developers, constructors and port authorities to meet the environmental assessments required by the European Union, neutralising CO2 emissions, protecting marine biodiversity and increasing the competitiveness of the ports.

Through Nereidas, a protocol has been designed that integrates the management of marine wildlife with the mitigation of adverse environmental impacts of Mediterranean seaports.

8 Millions of tonnes of CO2 could be imported through Peterhead each year

Peterhead’s carbon aspirations Peterhead Port has plenty of capacity for the import quantities of CO2 envisaged for the early build out phases of Acorn CCS, says the project report, and a maximum practical capacity of 16.2m tonnes per year.

For import quantities in the range of 5-10m tonnes per year, a fleet of three or four tankers of 30,000 to 50,000 dwt (equivalent to 24,000 to 40,000 tonnes CO2) would be required to service routes from CO2 export hubs within the North Sea area.

“The beauty of the project is that the ships

carrying CO2 could come from anywhere, whether the UK or across the North Sea,” says Steve Murphy, finance director at project lead Pale Blue Dot. “Access to the port could provide an integrated CO2 transport and storage service; within 50 kilometres of pipeline, there is 40%50% of the UK’s storage resource. We are talking about a great geographical asset in terms of storage, pipelines and port infrastructure.”

Mr Murphy, who is also a board member of Peterhead Port Authority, says the port has so far been involved in the project in an advisory

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capacity, “to make sure all the information being used and the outcomes are sensible from their perspective”.

“As a board member at PPA, I would emphasise that Peterhead is a Trust Port. As such, it does take a long-term strategic view of what is going to be good for its stakeholders and it is used to contemplating projects that have a long timescale.”

While some areas at the port would be potentially suitable for the project, no area has been specifically earmarked at this stage.

MAY 2019 | 27

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AREA SURVEY: UK

FRUSTRATION OF A ONE-TRACK PLANNING ENVIRONMENT Brexit: UK ports can’t be sure about it, can’t get past it and can’t ignore it.

But, as Felicity Landon reports, they are trying to look beyond it

8 Contrary to public opinion, UK ports are about more than the issues facing Dover

Anyone following the news in the UK over the past few months could be forgiven for presuming Brexit was the only thing happening in the entire country.

In some respects, they might almost be right. For ports, there has been the well-documented struggle to prepare for the unknown. In January, a survey by Odgers Berndtson found that only 16% of about 100 UK ports and harbour authorities had made any ‘significant or practical’ plans for Brexit, but 59% were expecting a negative or strongly negative impact. Making those plans has been precisely the issue – in ‘normal times’, who would commit to substantial investments based on such shifting sands?

In early April it emerged that the government had only provided 10% of the money needed for ‘no deal’ Brexit preparations at Portsmouth, saying that the estimated risk of disruption did not warrant extra funding; this was despite warnings from port director Mike Sellers that, with only 13 lorry lengths between the port and the motorway, delays caused by post-Brexit customs checks could cause congestion across the city, as well as severely hampering supplies to the Isle of Wight and the Channel Islands.

INDIRECT CONSEQUENCES In fact, the political deadlock over the UK’s future relationship with the European Union has had more than the obvious direct consequences.

“There is obviously a lot of discussion around the detail of short-term arrangements, Customs, and so on,” says Tim Morris, chief executive of the UK Major Ports Group. “But for the large majority of ports, there is a sense of looking beyond the noise of Brexit and holding on to the real fundamentals of geography and the importance of maritime trade to the UK and keeping that backed up by a continuing strong record of investment.

“Within that, there is a lot of work going on for everyone, not just those handling accompanied ro-ro, in terms of preparation for Brexit. That is not only dealing with government but also working with customers to inform them of the different systems and work through different situations – for example, storage short and long-term, and reconfiguring processes.”

However, while that is going on, there is a deep sense of frustration among ports for two reasons, says Mr Morris.

“First, the normal business of regulation and policymaking has essentially ground to a halt – meaning that day-to-day things like dredging disposal licences and engagement with the MMO and people in Defra are at a standstill while everyone prepares [for Brexit] within their own organisation or has been seconded to other organisations.

“The other bit that has ground to a halt is some of the policy management work that has, or should, come out of the Maritime 2050 vision. This had some really useful, important and ambitious things in it around infrastructure developments and the use of land around ports, which are obviously very important for my members; these have simply been parked while the whole of the Department for Transport essentially focuses on Brexit preparations. It is deeply frustrating for all ports.”

DOVER DOMINANCE A large subset of ports has a second frustration, says Mr Morris: the heavy Brexit focus on accompanied ro-ro and the Port of Dover in particular. “While no one would debate that Dover has a unique combination of risk factors in a ‘no deal’ situation and it is an important port, the mono-focus of the government preparation and media attention has been a source of significant frustration not just to general cargo/container ports but also other ports handling significant quantities of ro-ro activity. That isn’t helpful – a solution that might work for that very specific context might not be the right solution for a container port or a ro-ro port in a different location with a different set of circumstances. And that is regardless of whatever the political settlement is.”

Richard Ballantyne, chief executive of the British Ports Association (BPA), is thankful that the sector at least has “a good and stable ports policy regime, which for the most part is fit for purpose and not providing barriers or problems to the industry”.

8 Forth Ports’ Charles Hammond calls for a specialised and benign planning regime around ports

Credit: Forth Ports

For the latest news and analysis go to www.portstrategy.com/news

MAY 2019 | 29

AREA SURVEY: UK

WIDER PROSPECTS The Maritime 2050 strategy, published in January, features port economic zones. These are yet to be defined, but Mr Ballantyne would like to see freeports set up with a wide scope to include enterprise and development, preferential planning and business rates, business stimulation, and skills and training, alongside rules that allow duty payments to be deferred.

Updating the port master planning regime would also be important, “so not only residents living nearby but also local authorities, regional government and sub-regional transport bodies recognise ports’ aspirations and activity”, he says. “Master planning gives ports the opportunity to express their long-term aspirations and business plans with key stakeholders as well as residents.”

Credit: Matt Buck

However, he highlights frustration around the marine consenting environment. “We have largely reached the mature stage in terms of marine designations - i.e. MCZs, SACs, SPAs, etc. – so for the most part we are not expecting any new designations. But in terms of what existing designations mean, it has caused problems for developers and ports seeking consent.”

The BPA estimates that 70% of UK harbour authorities have some form of marine designation in or adjacent to their harbour area. That means that a full impact assessment and costly monitoring exercises are required for any proposed development and these can delay consent substantially, says Mr Ballantyne.

“We are working with the UKMPG and government looking at ways to improve permitted development rights – i.e. the right to do certain things without planning permission – but again they are trumped by the environmental designation.”

Charles Hammond, chief executive of Forth Ports and chairman of the UKMPG, foresees supply chains shifting postBrexit, with a shift likely towards unaccompanied freight. That’s particularly the case as a shortage of drivers and more emphasis on work-life balance means road haulage will become more regional and less long-distance, he believes.

“Dover will still have an important role to play but rather than focusing so much through Dover with long lorry journeys, people will start to look at shipping in a different way,” he says.

“You can’t and should not force markets to do things but it’s inevitable that we will see that type of shift.”

South East England, particularly the London area, is

8 UK ports are frustrated by the lack of movement on laudable Maritime 2050 actions

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AREA SURVEY: UK

underweight in warehousing compared with population, while the Midlands is probably the reverse, says Mr Hammond. “And a lot of goods landed into the South East go to warehousing in the Midlands – and then back to the South East.”

Mr Hammond also says that if ports are facilitators of trade, then the land around ports should add value to the trade flows.

“We should have a specialised and benign planning regime around ports, and the best connectivity around major ports.”

Planning processes should make it easy to invest and start up businesses in land around ports, he says. “Having laid out

that agenda within the industry, we are saying to the government, rather than just talking in a general document, let us see some specific policies on this.

“The purpose of a port is to facilitate efficient supply chains that make people’s everyday lives stable and easier.”

Mr Morris agrees: “The ambition is to put all economically viable land around ports into productive use. If you could achieve even half of that, it would be transformational in terms of development, jobs and communities.”

8 The BPA’s Richard Ballantyne would like to see freeports set up with a wide scope in the UK

Investment still flowing The UK major ports sector has seen a consistent record of steady, significant investment, adding up to roughly £600m a year since 2015, says the UKMPG. Among the developments currently underway are Dover’s Western Docks Revival, Aberdeen’s £350m harbour expansion, Felixstowe’s investment in new ro-ro facilities for DFDS, Forth Ports’ Tilbury2 expansion and ongoing logistics developments at London Gateway.

“There are also many smaller but important projects to improve capacity and capability –

for example, Bristol improving capacity in the container yard and in bulk handling, and ABP’s container expansion on the Humber,” says Tim Morris. “That is a trend we are seeing continue.”

A notable trend is in developments not directly related to cargo volumes, says Richard Ballantyne. “Aberdeen’s main aspiration is serving the offshore energy sector in the North Sea; the expansion isn't about direct cargo growth. Other east coast ports are looking at this, especially Blyth and Lowestoft, which are important hubs spaced out from Aberdeen down the east coast – and other ports can do similar.

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The Government’s pledge to increase offshore wind power by 30% by 2050 is very exciting for ports. Also very relevant is the requirement for a specific level of UK content in UK developers’ projects, he says. “Basically, it means a percentage of content must be done in the UK, and means UK ports will be best placed to service that.”

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PORT PROFILE: TILBURY

TILBURY2 STARTS WITH A BLANK SHEET OF PAPER Tilbury2 is under way. In February, owner Forth Ports received development consent for its expansion of the Port of Tilbury, and construction work started almost immediately.

Taking in 152 acres of former power station land right next door to the existing port, Forth Ports says the development will create the UK’s largest unaccompanied ferry port, the country’s biggest construction processing hub, with Authorised Economic Operator-trusted trader status, a new significantly larger rail head which can accommodate the longest freight trains of 775m, and storage areas for a variety of goods, including exported and imported cars.

Tilbury2 is due to be operational in spring 2020. “Work has started onsite, with manufacturing already taking place for the ro-ro terminal,” says Forth Ports chief executive Charles Hammond. “We have also continued with our extensive ecological mitigation compensation, relocating a lot of species to Mucking and Paglesham. There is a huge effort going into the ecological side.”

The riverside site has effectively provided a blank piece of paper in terms of design and that is particularly important, he notes. “Because this site will be designed from scratch as a modern port with modern systems and equipment, it will be more productive.” Tilbury2 will have the capacity to handle the same tonnage as the original port in a quarter of the land area.

‘‘

We have also continued with our extensive ecological mitigation compensation, relocating a lot of species ...

There is a huge effort going into the ecological side CHARLES HAMMOND, FORTH PORTS

Tilbury2 will operate as a satellite of the present port. And, probably needless to say, there is a Brexit angle to the facility.

Forth Ports has pointed out that it will provide significant new capacity for unaccompanied roll-on/roll-off trailers in the South East, with direct access to the market – adding “extra resilience” to the UK’s port infrastructure.

To be used by P&O’s expanding Tilbury-Zeebrugge services, the ro-ro terminal will feature a linkspan bridge into the river, with a pontoon to handle two larger ferries, backed up by 50 acres for trailers and containers.

The aggregates terminal will be built in the northern part of the site – a conveyor system will move materials from the quay for stockpiling and production of block paving, asphalt and ready-mix concrete. Tilbury2 will be dredged to 15 metres, so that self-discharging aggregate ships can be handled.

SERVING GROWTH Expansion is essential for the Port of Tilbury to cope with rising

For the latest news and analysis go to www.portstrategy.com/news

Credit: Port of Tilbury/Forth Ports

The Port of Tilbury is expanding next door as part of its £1bn investment programme.

Felicity Landon reports on its plans

demand for construction materials and aggregates from the construction sector, an increase in cars, and an increase in commercial ferry volumes, which include consumer goods, food and drink, and steel, says Forth Ports.

Tilbury2 is central to the Port of Tilbury’s £1bn investment programme during 2012-20. The port is projected to double its cargo volumes from 16m to 32m tonnes and increase direct employment from 3,500 to 12,000 jobs over the next 10-15 years.

Tilbury claims the top spot in the UK for paper and forest products, as well as for recyclables, including glass, wood, metal and general waste. Tilbury Grain Terminal, celebrating its half-century this year, is one of the country’s largest. A 16,000 tonne capacity, automatic fill flat store extension has recently been completed, bringing the grain terminal’s total storage capacity to 136,000 tonnes.

Meanwhile, Tilbury’s London Container Terminal (LCT) handles both shortsea and deepsea services. A new rail service was introduced in 2018, linking the terminal with the Midlands and Central Scotland. Operated in collaboration with Stobart Rail, DRS, JF Hillebrand and Samskip, the first service departed at the beginning of September.

In February this year the port won the Rail Freight and Logistics Excellence award at the Rail Business Awards. As well as introducing regular intermodal services, Tilbury has created a dedicated bulk rail terminal which has subsequently been expanded to handle growing demand.

Tilbury has always prided itself on being a multipurpose port, and it has recently attracted two new cargoes.

After handling trial shipments of pumice stone last year, the port now has regular shipments confirmed for 2019 onwards.

Shipped from the volcanic Greek island of Yali, the pumice is used to manufacture lightweight building blocks for the construction industry.

Tilbury is also handling its first regular liquid bulk shipments.

Praxair started regular imports of carbon dioxide in 2018. This year it will open a purpose-built facility with specialised storage tanks on the quayside. The CO2 is imported for a variety of uses, including for beer pumps, abattoirs, refilling refrigerated transport units, producing carbonated drinks and beer, and in bakeries.

8 Tilbury’s expansion is due to be operational in spring 2020

MAY 2019 | 33

REGIONAL SURVEY: SOUTH EUROPE

GAME OF LEAPFROG IN THE MEDITERRANEAN

Credit: Kumport

Competition is heating up for the number one slot in the region’s container handling sector.

Alex Hughes reports on who is vying for pole position

Over the past 25 years, Valencia overtook first Barcelona and then Algeciras to not only become Spain’s leading container port, but also the effective number one box handling facility across the entire Mediterranean. With plans to build a fourth container terminal as part of its new northern extension, the port’s inexorable rise seems irreversible.

Piraeus, previously an underwhelming alternative notable for its high costs and poor efficiency, has other ideas.

Last year, throughput growth of 18.4% meant Piraeus reported throughput of 4,907,908 teu, while Valencia grew by “just” 7.25% to 5,182,665 teu. Should those increases continue into 2019, Piraeus will overtake Valencia.

In the Greek port, Piers II and III – which are operated by COSCO as Piraeus Container Terminal – handled 4.4m teu last year, while Pier I, which is operated by Piraeus Port Authority, handled 498,708 teu, achieving an increase of 10%. According to the port authority, there was a significant 25.4% rise in the volume of import-export cargo, which amounted to 95,673 teu, while transhipment rose 6.9% to 403,035 teu.

If Piraeus does, as seems likely, overtake Valencia, it will have COSCO to thank. Although the Chinese state company has a major stake in both ports, owning terminals in each, to date, its shipping line arm has favoured Piraeus.

However, with a fourth container terminal concession on offer at Valencia, the question remains as to whether COSCO management will be tempted to enter a bid and start a similar cascade of traffic as took place when it acquired a major concession in Piraeus in 2009.

INVESTMENT GROWTH According to Piraeus Port Authority, the Chinese have already invested more than €600m in upgrading port infrastructure there, boosting overall terminal capacity to 7.2m teu, making the port an ideal location as the main hub in the Eastern Med. Thanks to COSCO, Piraeus has posted some of the highest rates of box traffic growth globally. It has now moved up some

34 | MAY 2019

8 COSCO’s presence in Turkey at Kumport (pictured) and in Egypt bolsters its Mediterranean ambitions

50 places in the overall world ranking of container throughput, occupying a position just within the top 40. It is already Europe’s sixth largest box port and second behind Valencia in the Mediterranean. Its ambition is to be among the world’s 30 most important ports, Europe’s fifth busiest, and the leading box port in the Mediterranean, ousting Valencia.

According to George Vaggelas, managing director of consultants Ports & Shipping Advisory, Piraeus’ aspirations do seem to be realistic.

Given that container traffic has already effectively doubled in recent years, he forecasts that it will continue to experience high development rates. Indeed, in both January and February, box traffic at COSCO’s Pier II and III operations grew 22.2% year-on-year.

Nevertheless, he cautions that future growth depends on the overall strategy adopted by COSCO in European and, especially, Mediterranean ports in which the company has a presence, which is not just Valencia and Piraeus, but also Port Suez (Egypt) and Kumport (Turkey).

“Chinese decisions regarding the One Belt-One Road strategy, particularly in expanding their interest in other European ports also remains key,” he says, pointing to an existing limitation at Piraeus, where the maximum handling capacity is currently 7.2m teu annually.

By adding a fourth box terminal, Valencia will effectively boost its own capacity from 7.5m teu to 12.5m teu, and with state-ofart technology it could well be in a position to undercut other Mediterranean hubs in attracting transhipment traffic, which is where much of the rise at Piraeus has come from. Greek importexport traffic nowadays plays a relatively minor role at Piraeus, whereas Valencia has been able to wrestle transhipment traffic away from competing regional hubs thanks to its buoyant position as Madrid’s leading maritime outlet.

While COSCO has long been a major shipping line customer of Valencia, it only became a majority shareholder in Noatum Ports in June 2017. Furthermore, uncertainty surrounding stevedoring reform in Spain may well have delayed its own

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REGIONAL SURVEY: SOUTH EUROPE

COSCO BOOST Prior to the arrival of COSCO, Mr Vaggelas concedes that Piraeus “was under-performing”, mainly as a consequence of the previous governance model for Greek ports. “Reform didn’t advance quickly enough, with the public sector remaining the major player at Piraeus until the arrival of COSCO in October 2009. Prior to that, Piraeus Port Authority had been the sole port operator, with the Greek State holding the 74.14% of the shares and the remaining 25.86% being traded on the Athens Stock Exchange. As such, Piraeus port was operated as a state company, which had an impact on its performance. It was handicapped by over-staffing, reduced operational efficiency and a business strategy focused mainly on achieving state goals instead of pure commercial goals.”

The result was an inefficient port, with workers having jobs for life, and trade unions able to negotiate generous benefits for their members.

Although there are similarities with the current situation in Valencia, the Spanish port has nowhere near the low level of productivity/efficiency that Piraeus once suffered. Although dock workers are generally agreed to be overpaid, and efficiency is not remotely as good as that at the Port of Barcelona, operations at Valencia are still relatively efficient.

However, as to what COSCO might be able to achieve at Valencia very much depends on how the EU-directed

Credit: Valencia Port

development plans, although it has just rebranded its Valencia operation as CSP Iberian Valencia Terminal, suggesting a certain degree of permanence at the port.

stevedoring reform is eventually implemented. The current position is one of monopoly providers effectively giving port unions much too much power over negotiations with management. With the sector opening up, all that could change.

8 Valencia intends to keep its number one slot in the Mediterranean

ECONOMY DRIVERS The high profile economic crisis faced by Greece proved a major driving force behind reform as did fiscal measures taken by the government. These saw salaries cut, overtime reduced and additional benefits enjoyed by the port workers made less generous, all driving down labour costs.

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MAY 2019 | 35

REGIONAL SURVEY: SOUTH EUROPE

order to avoid being affected by the new pension scheme, which would have meant lower incomes and an increased age limit for retirement.

“The government also froze recruitment and that helped downsize personnel costs,” says Mr Vaggelas.

The takeover by COSCO didn’t just mean the introduction of modern container handling techniques. The Chinese had long been looking for an EU port in which to invest and, when they

got a foothold, traffic from COSCO’s deep sea fleet began to flood in.

The port workforce has accepted changes introduced by the new owners, since all personnel employed by it at PCT have been hired under working conditions dictated by the company and have therefore not experienced anything different.

8 Ports & Shipping Advisory’s George Vaggelas concedes that Piraeus was under-performing before COSCO’s arrival

Piraeus’ transhipment ambitions Given that there are multiple transhipment options open to shipping lines in the Mediterranean, the question remains whether Piraeus will be able to attract more of this, or will simply be seen as a COSCO hub. However, Mr Vaggelas says the situation is more complex than this, since being able to offer attractive prices is just one factor.

“Of course, it plays a role, but in the contemporary port industry cargo is transported via the most efficient and cost-effective transport chain, thus port cost is only one parameter of the decision process. In my opinion, Piraeus will attract

more transhipment cargo since COSCO is a decisive factor, not only in terms of its own traffic, but also in that transported by Ocean Alliance and other alliances. If Piraeus wants to maintain its position as a major transhipment hub in the Mediterranean and in Europe, it also has to invest in logistics and especially in added value activities related to the container business,” he says.

In this respect, Valencia is well ahead of the game. Not only does it offer customers an adjacent logistics activity zone (ZAL), but COSCO has also acquired majority stakes in two inland container terminals, at both Madrid and Zaragoza, which help generate key flows of import-export

boxes. Now that passenger trains to Madrid make use of their own dedicated high-speed line, trains on the parallel freight corridor no longer have to compete for slots, although a significant number of containers do still move by road to the Spanish capital.

Upgrading the Zaragoza-Valencia rail link has long been under discussion, although making a good financial argument for doing so has been difficult, even though automotive production plants in northern Spain have undertaken trials to see whether racks of finished vehicles could also make use of this route, thereby making a more sound economic case for investing in it.

YOUR INTERMODAL PORT IN THE MED

36 | MAY 2019

For the latest news and analysis go to www.portstrategy.com/news101

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PORT PROFILE: ITAPOÁ

BUCKING THE NATIONAL TREND TO BOOST VOLUMES Brazil’s ports have had a tumultuous few years, with throughput stunted by on-off concession deals, strikes, and the ramifications of the anti-corruption Operation Car Wash aimed at cleaning up the nation’s businesses. One port that has avoided much of the ruckus has managed to thrive in this environment, moving almost 50% more containers than the national average.

In fact, Porto Itapoá is doing so well that even as it finishes it first expansion phase – which doubled its original layout to 1.2m teu capacity – it is preparing the ground for its next expansion, which will increase its capacity to 2.5m teu.

It’s also considering automation of equipment at all levels, explains operations director Sergni Pessoa Rosa Junior.

“We are conducting a study with some equipment providers in order to analyse and prepare the terminal for container handling equipment automation,” he tells Port Strategy. In addition, the terminal runs Navis’ N4 automation-ready terminal operating system.

All this is being undertaken with the environment firmly in mind. Porto Itapoá believes that it is not enough to meet environmental regulations: “Environmental preservation is mandatory, essential,” says Mr Junior.

“One of the most important items of our value chain and strategic plan is the environment,” he adds. “Porto Itapoá’s mindset is to preserve our environment in order to guarantee a sustainable and healthy future for our community and planet.”

The port has a number of programmes that target environmental preservation, including recycling, constant monitoring of gases, smart water use, and protection of fauna and forestry. Further, all the lubricants it uses are biodegradable.

“For our environmental license we have done more than the regulation determines,” points out Mr Junior. “For instance, to compensate for the loss of forestry Porto Itapoá acquired an area 10 times the size of its expansion area. After the acquisition of the land, we attached a permanent preservation area to it so that it is legally protected.

“I believe and I am sure and confident that without sustainability in all aspects – social, economic and environmental – the business has no chance of surviving.”

ROAD RAGE There have been some blips, however. Last year, Porto Itapoá did not manage to escape the truck strikes that brought traffic to a standstill throughout the country. Now, says Mr Junior, the relationship is back on an even keel.

“Truck drivers are one of our most important customers and the terminal puts in all efforts to give them the best service level, and one of the fastest truck cycles in our industry.”

The port also has a dedicated building in the gate area where drivers can rest, grab a coffee and a snack and leave their families – if they are travelling with them – while the driver enters the terminal to pick up or drop off the container.

“Porto Itapoá and truck drivers have a mutual respect. This is what makes this relationship great,” says Mr Junior. To measure

38 | MAY 2019

Credit: Porto Itapoá

Porto Itapoá has moved beyond increased throughput and potential automation to ensure its future success, writes Carly Fields

satisfaction Porto Itapoá regularly undertakes a satisfaction survey and maintains open communication channels between its customer service department and truck drivers.

The port also actively participates in community engagement and support programmes. It says that its people are its most important asset and since its start up it has actively invested in and trained local talent, instead of ‘importing’ a ready labour force.

“During the pre-operational phase, our team dedicated themselves to preparing and training the local people. We are very proud to say that we have proficient quay crane operators who had never seen a container before the Porto Itapoá installation.”

Another undertaking that Mr Junior is particularly proud of is its ‘Mulheres Portuarias’ project, which translates as Port Women. Through this the port has supported women in the community to work at the port in any department.

“I am proud to say that the Porto Itapoá team have phenomenal women handling and maintaining our quay cranes, RTGs and terminal tractors and also planning and executing our operations and processes,” he says.

Beyond that, Itapoá has a collection of ongoing community initiatives under the umbrella title of AMPLIAR. Examples of parts of the program are support for the local handcrafters to help them scale up their business, support for local fishermen, educational programs for children, and health campaigns.

8 Itapoá is championing its successes

8 Itapoá’s Sergni Pessoa Rosa Junior says the port has gone above and beyond legislation to protect the environment

For the latest news and analysis go to www.portstrategy.com/news

COASTLINK CONFERENCE

A STRONGER FUTURE FOR SHORT SEA SHIPPING As shipping gets smarter and more sustainable, the Coastlink conference addresses how short sea and container feeder shipping can best secure a stronger future The changing European logistics landscape, managing transport procurement and service, and the impact of China’s Belt and Road Initiative (BRI) will be the focus of the 2019 Coastlink conference, which aims to offer diverse insights into the challenges and opportunities that these issues bring.

2019 is the first year the conference will be delivered by its new owner, Port Strategy’s publisher, Mercator Media Ltd and will take place on 12-13 June in Southampton, UK, alongside commercial marine exhibition Seawork International on 11-13 June.

Andrew Webster, CEO of Mercator Media, says: “Mercator is a great, new home for the Coastlink Network events.

“It fits very well with what we do and complements our magazines that overlap this marketplace; Port Strategy, The Motorship and Maritime Journal as well as our events, GreenPort Congress, Propulsion & Future Fuels and the well-known commercial marine exhibition, Seawork.”

COMPETITIVE SUPPLY CHAIN The conference was originally formed to create a neutral panEuropean network dedicated to the promotion of the short sea and container feeder shipping sector and help create a more competitive supply chain. As the port sector is a key stakeholder in this chain, Clive Thomas, head of commercial & property at ABP Southampton, will deliver the Coastlink welcome address.

Session one of the conference’s first day will look at adapting to the changing economic demands for transportation in Europe’s logistics landscape. As part of this session, delegates will learn about the strategic importance of short sea shipping in the Port of Antwerp from Justin Atkin, the port’s UK and Ireland representative. His talk will focus on Brexit as a catalyst to the re-engineering of supply chains and the modal shift it could create from accompanied trailers to containers.

This session will also look at the challenges around the European road haulage industry and the global shortage of staff in logistics.

The 2019 Coastlink conference will focus on logistics, procurement and China’s Belt and Road Initiative COST-EFFECTIVENESS Session two of the conference’s first day will consider how to manage transport procurement and service, looking at the best cost and delivery solutions, while reducing the environmental footprint of operations.

Improving efficiency is a continuing priority for ports as well as other industry stakeholders, and panellists for this session will include Richard Ballantyne, chief executive of the British Ports Association (BPA) and Alex Veitch, head of multimodal policy at the Freight Transport Association (FTA).

Andrew Ellis from DP-World owned Unifeeder UK will be delivering the keynote talk for session two. Unifeeder provide the largest feeder and shortsea network in Europe, while sister

For the latest news and analysis go to www.portstrategy.com/news

company Unimed Feeder Services is a leading feeder operator in the Mediterranean and the Black Sea. On the agenda for session three on day two of the conference is the BRI and how Chinese initiatives and investments are influencing European short sea shipping.

The session will be moderated by Nick Lambert, director of NLA Ltd, while joining the panel discussion will be Mark Hamson, international trade adviser at the UK government’s Department for International Trade.

As part of the session, Krzysztof Zalewski, marketing & international relations specialist at the Port of Gdansk will offer his insight into China’s growing business in Europe through the BRI.

8 This year’s conference is the first run by new owner, Mercator Media Ltd

GROUNDED INSIGHT Mercator Media took over the Coastlink conference from its co-founder Gavin Roser, ambassador at large for The European Freight and Logistics Leaders’ Forum (F&L). Shipping professional Mr Roser will chair the conference this year and has acted as consultant to ensure its continued relevance.

Since being established by Mr Roser and David Cheslin in 2004, Coastlink has hosted 18 conferences and meetings to help maximise the utilisation and potential of shipping networks; achieve an environmentally friendly modal shift to shipping; encourage more services linking ports in European waters; and develop collaboration between shippers, ports, shipping lines and freight organisations.

8 The Coastlink conference will take place at the Leonardo Royal Hotel Southampton Grand Harbour in Southampton, UK. Visit www.coastlink.co.uk

MAY 2019 | 39

LEGAL: FINANCE

CHECKING THE RIGHT BOXES TO SECURE FINANCING Watson Farley & Williamsâ&#x20AC;&#x2122; Lindsey Keeble, Christina Howard, and Florian Kutzbach deliver key financing advice The ownership, acquisition and development of ports and terminals require significant financial investment and therefore an owner or investor is inevitably going to require external financing in order to secure the funding needed for the relevant acquisition or development.

In the current climate in which ports are competing for customer volume, continued investment (and the funding of such investment) in the infrastructure, superstructures and equipment for a terminal is increasingly important; an operator therefore needs to ensure that it has the correct structure to be able to attract financing to ensure a bankable transaction.

While there are other sources of funding available in relation to ports and terminal projects, including equity investment from local or international partners, it is common for funding to be sought by way of external financing through a commercial loan from a bank or development fund or subscription for bonds.

CONCESSION AGREEMENT Any lender assessing potential port financing will firstly want to ensure that the key contracts, permits and licences granting the borrower the rights to develop and use the port are, and will remain, valid during the life of the loan.

The main contract in any port project will be the concession agreement (and any local general or special terms and conditions under which the concession has been granted). A concession agreement will usually have been entered into by a national port authority (usually part of the local government) and will typically be governed by the local law in which the port/terminal is located and granted in accordance with local law/regulations/procedures.

Early due diligence is therefore key to ensuring that the relevant local law requirements have been fully complied with in granting the concession and that there is no risk that the concession could be terminated or revoked prior to the repayment of the loan or that the port authority cannot comply with its obligations under the concession agreement as a result of any breach of local process/tendering requirements. This is particularly relevant where the lenders seek to enter into a direct agreement with the granting authority to clarify or interpret the concession agreement to address bankability concerns unearthed during the due diligence phase.

Key bankability concerns that will guide the lenders in this respect include a clear risk allocation and protection in terms of, for example, permissions, change in law, force majeure,

liquidated damages (for delay or operational failures), exclusivity, termination and termination compensation as well as step-in and enforcement.

A lender will also wish to confirm whether the concession agreement contains any right in favour of the port authority to withdraw or add conditions to any permits or licences needed for the exploitation of the concession or contains any other contractual rights of termination or revocation in favour of the local port authority. Lenders will also look for relief, at least in respect of time, from any permitting delays.

Any onerous financial provisions under the terms of the concession which may impact the borrowerâ&#x20AC;&#x2122;s ability to service the loan will also need to be considered to ensure that the borrower is not potentially subject to significant compensation requirements or penalties in the event of non-performance or breach.

If the relevant transaction being financed will result in a direct or indirect change of ownership of the concession holder, a lender will also need to confirm whether such change will trigger a change of control under the concession agreement (or under any other key documents for the concession or the port project). Breach of change of control provisions may result in a right for the port authority to terminate or revoke the concession and any other contracts which are required for the development/exploitation of the port project or trigger a lengthy consent process.

8 Certain jurisdictions, including Portugal, charge stamp duty if swaps are entered into after the signing of the original loan agreement

8 From left to right: WFWâ&#x20AC;&#x2122;s Lindsey Keeble, Christina Howard and Florian Kutzbach

40 | MAY 2019

For the latest news and analysis go to www.portstrategy.com/news

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LEGAL: FINANCE

Any lender financing a port project will wish to include detailed consent rights in relation to any proposed amendments to the terms of or exercise of renewal or other rights by the borrower under the concession agreement.

INCOME STREAM A key focus for any lender will be the ability of the borrower to satisfy its payment obligations and repay the loan over its term.

As with any project financing, this will mean an assessment of the project income stream which, in the case of a port or terminal project, will mean an assessment of the traffic volumes and key customer agreements.

The lender will also need to check how the port is used – is there one main user of the port or are there multiple users?

What contractual arrangements are in place with each user; do they have a minimum usage fee or provide a regular income?

Can the rights of the borrower under these agreements be assigned in favour of the lender as security for the loan?

If the relevant financing relates to the development of a port or terminal project then there may not yet be an established income stream for the project and the lender will therefore look to take security in relation to the development contracts and will consider direct agreements to enable the lender to have step in rights in respect of the relevant project, including the construction and operational contracts as well as the concession agreement itself (where possible).

As part of any lender’s due diligence exercise, risks will be identified as well as potential sources of additional cash flow, which lenders may want to ensure are applied in prepayment of the financing. Care needs to be given to such additional borrower cash events as often such payments are designed to compensate the borrower for losses incurred; for example, if there are indemnity payments due to a borrower under a concession agreement. To ask for these to be applied in repayment of the loan could leave the borrower with financial exposure and put strain on its cash flows, ultimately risking the financing.

As lenders may find that corporate guarantees in relation to the obligations of the borrower are often not available due to the corporate/joint venture structure of a port project and the desire for the sponsors to ringfence their local operations, a key issue will be what other security is available for the loan. Linked to this will be what security is permitted under the terms of the concession agreement and other contracts. In addition to assignments of the income stream, the lender may consider taking security in the form of a pledge over the shares of the borrower or a charge over its business or property/equipment.

Any shares pledge will, however, need to be considered in light of the change of control issues highlighted above.

As the borrower is likely to be established in the local jurisdiction, the lender will need to take local law advice in relation to taking security over the relevant entity and local assets as well as the ability to enforce any such security.

ENVIRONMENTAL ISSUES Depending on the location and nature of the relevant port development project, a lender may require an analysis of the local environmental laws and regulations (and whether the port has ‘green port’ credentials) and potential liabilities for the owner of the development and whether this could adversely impact the ability of the borrower to service the loan.

Compliance with the Equator Principles applicable to project finance banks will be of relevance here.

Additionally, local law advice will be needed in relation to any port financing. In addition to confirming compliance with all local law requirements when the concession was granted, if

42 | MAY 2019

security for the loan will be created in an overseas jurisdiction, then any relevant local law issues and costs in relation to taking such security should be considered. Relevant costs may include local taxes as well as notarial fees and registration fees in relation to security created in that jurisdiction. Stamp duty/private stamp taxes in particular can be a significant cost if applicable to the loan (particularly if they are a fixed percentage of any loan amount).

Any such costs should be identified at an early stage in order to ensure they are factored into the overall pricing of the loan and structuring of any security. Certain jurisdictions, for example Portugal, also charge a further stamp duty if swaps are entered into after the signing of the original loan agreement which can be mitigated if considered up-front.

Given the scale of a port financing, there may be multiple lenders and facilities covering different aspects of the project, including local development banks. Multiple facilities at different levels (senior, junior, mezzanine etc.) can give rise to complex intercreditor issues. Negotiations with any existing lenders in relation to these issues, such as subordination and cure rights, will need to be considered at an early stage to ensure that in the event of any breach or default, each lender’s rights are protected.

In conclusion, when assessing any port/terminal financing proposal, a lender will undertake a detailed risk and bankability analysis, based on thorough local due diligence, in order to identify the key risks. With advice at an early stage from experienced advisors any such risks can usually be addressed or mitigated, allowing the financing to go ahead.

8 There needs to be a clear risk allocation in concessions

8 Lindsey Keeble is global maritime sector head, Christina Howard is a partner in the corporate group and Florian Kutzbach is a partner in the banking and finance division at Watson Farley & Williams. They are the three key partners in WFW’s port and terminal infrastructure group.

8 A lender will check how the port is used and whether there is one main user or multiple users

For the latest news and analysis go to www.portstrategy.com/news

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innovate ports PSA unboXed, the Singaporebased innovation and corporate venture capital arm of PSA International, and Israeli-based theDOCK Innovation Hub have entered into an agreement to invest in startups to leverage innovative technologies that will benefit the port, maritime and supply chain sector. Under the agreement, theDOCK will facilitate for PSA unboXed, scouting, screening and investment in promising startups which provide solutions addressing specific challenges cited by PSA. The partnership between PSA unboXed and theDOCK will begin with a first ever maritime tech Hackathon in Israel this June. The event will be solely dedicated to a list of challenges which reflect the digital transformation needs in the port and shipping sector. ❙ Navis helps SAGT

prepare for growth Cargotec firm Navis and Sri Lanka’s South Asia Gateway Terminals (SAGT) have agreed a deal to use Navis optimisation and analytics services to help the terminal prepare for growth. SAGT, a terminal located in Sri Lanka’s Port of Colombo, signed a strategic agreement with Navis that lets the facility automate and optimise, through Navis N4, key components of its operations. SAGT has been running Navis solutions for around 20 years and is achieving strong productivity levels. At the end of last year the terminal recorded 2m teu with an original design capacity of 1.1m teu, and it thus requires further optimisation to handle growing volumes and business.

SAFETY FEATURES ‘MUST BE STANDARD’ Container crane manufacturers that fail to apply minimum safety features as standard are putting lives at risk, an audience at TOC Asia was told.

Laurence Jones, TT Club director, global risk assessment, expressed exasperation that manufacturers have not risen to the challenge of fitting existing safety technologies as standard and not as optional extras.

TT Club figures reveal that the quay crane continues to be the biggest single cost for insurance claims. “Let’s save lives and money and remove quay cranes from the No.1 risk spot,” he said.

“The technology is there. But why is it not being used? Do terminals think their insurance will cover everything? Do they think these accidents will not happen to them? They are wrong in both cases,” he said.

Back in 2011, TT Club, ICHCA and PEMA published a joint document “Minimum safety features for quay container cranes”. An update of this document is soon to be published

and Mr Jones has urged that the minimum safety features highlighted be treated like seat belts in cars: standard, not optional.

“Seven years after the initial publication this is still not the case,” he said. “I challenge all container crane manufacturers to place safety first and make these minimum safety features all

8 TT Club’s Laurence Jones urged a rethink on crane safety

standard, not optional. I also encourage all terminals to include these safety features in the technical specifications for new quay cranes.

“These features should also be retrofitted to existing cranes,” he added.

UK PORT WELCOMES FIRST REMOTE RTGS The busiest container port in the UK has seen the arrival of its first remote-control rubber-tyred gantry cranes (RTGs).

In a release, the Port of Felixstowe said the four new electric-powered pieces of lifting equipment, constructed in China

by Shanghai Zhenhua Heavy Industries, constitute the first of eight similar machines to be delivered over the next few weeks.

The products, which were

delivered to the Hutchison Ports facility by multipurpose carrier AAL Kobe, are set to serve Berths 8&9, where an extra 18,000 teu of container storage has been created to meet rising demand at the port.

The cranes have the ability to stack boxes six-high to allow for more efficient use of a new yard area. They represent an important step towards more remote working at the Port of Felixstowe, according to the facility’s operations director

Robert Ashton, who added that remote working is set to provide advantages for customers as well as employees.

“For the drivers, the ergonomics are much better than a traditional operation,” he said.

“The physical stress to a driver’s back, neck and shoulders will be significantly reduced and the vibrations experienced as cranes operate will be eliminated altogether.

Performance model “not a science project” Kalmar executives have stressed that the equipment provider’s new performance guarantee model is “proven technology and not a science project”.

Speaking at Navis World, account director Martin Church said that this is “a vision of the future” and that “no one is as prepared as we are for that future”.

The recently-launched model will see Kalmar get paid on the basis of performance – such as completed container moves per hour – rather than the number of container

44 | MAY 2019

handling machines it sells or leases.

Guenter Schmidmeir, senior vice president for global terminal operators at Kalmar, described the performance model as a “true partnership”, adding that it opens up a completely new way for terminals to finance.

“The contract length is aligned with the expected equipment lifetime,” he said. “Today, equipment is handed over and you have a service contract, but it is a different experience.”

He added that this longer scheme requires dedication from Kalmar and represents a “true

opportunity for innovation” for terminals.

In terms of accountability, Mr Schmidmeir stressed that there is one contract and one accountable party to cover both Kalmar and Navis’ involvement under the OneTerminal brand. Also, “everything that we build and design puts safety first”, he said.

OneTerminal offers an integrated automation solution, bringing together Kalmar and Navis’ software systems, equipment and services for either brownfield or greenfield sites.

For the latest news and analysis go to www.portstrategy.com/news

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Meet and network with international attendees representing logistics companies, terminal operators, shipping lines, and freight organisations.

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TECHNOLOGY: NAVIS

MAKING A SPLASH OFF A TOS SPRINGBOARD When Navis leader Benoit de la Tour first took to the stage at this year’s NavisWorld conference it was to join a troupe of beat boxers sporting black t-shirts with the names of different stakeholders emblazoned on their tops. Representing the coming together of siloed parts of the container supply chain, ‘container’, ‘terminal’, ‘carrier’, ‘gate’, ‘vessel’ and ‘inland terminal’ repeatedly announced their roles while weaving through the audience with increasing ferocity until they crescendoed in harmony on the stage.

Gamely clapping along, Mr de la Tour used the end of the performance to open the biennial Navis user group conference and sagely noted that “behind every great performance is a great team”.

As one of the industry’s largest terminal operating system providers, Navis is already a household name in the industry.

But it has moved well beyond its humble TOS environs over the past few years.

“We build software that makes users and companies more efficient. But it is not just about software; it is about empowering people and users to make the most out of our software,” explained Mr de la Tour. “We understand that we have thousands of users around the world and we have a responsibility to support them.”

Speaking at the event, he went on to say that Navis is investing in product improvement, enriching its product portfolio with more value-added solutions, as well as adding new products.

Referring to a McKinsey report, Mr de la Tour noted the prediction that 50% of any new terminal capacity over the next five years will be automated. Consequently, Navis is investing heavily in making its automation solutions smarter. Meanwhile, investments in its general cargo option will make it more flexible; investments in its rail solution aim to make that more intelligent and scalable; and its XVELA brand will be rolling out a new berth management module. For carriers, Navis is working on a high performance stowage solution and is adding more features to its Blue Tracker, including comprehensive carbon tracking reports and linking vessel performance with cargo optimisation.

Looking at its roadmap going forward, theres investment committed to the ubiquitous N4 platform through to 1H 2020 as well as a focus on optimisation and automation of autonomous trucks. There is also a drive to make the control room as efficient as possible.

CONFIG HEAD-START Another new innovation sees Navis launching a standards program to give new terminals implementing its software a ‘head-start’ by minimising the number of decisions which need to be taken when configuring.

Through the use of ‘blueprints’, terminals will be able to use standard configurations for options that do not offer any competitive advantage. To aim is to give terminals more time to focus on “high value innovations”, said Floris Vernooij, senior product manager at Navis.

46 | MAY 2019

Credit: Navis

Navis has moved far beyond its terminal operation system origins with its multitude of product offerings, writes Carly Fields

“We need to do more with what we have on ever fewer resources,” he said. “We can standardise certain business processes to achieve faster implementation. We can leverage best practices and known solutions so that we don’t have to reinvent the wheel every time.” He adds that this new approach also reduces risk and allows terminals to focus on “differentiators”.

Hannah Gilberg, senior manager of documentation at Navis, explained that the blueprints currently under development will form part of Navis Smart Projects which incorporates standardised project deployment methodologies and training.

Currently, blueprints are in development for manual reachstackers, manual RTGs and N4 automations. The plan is to expand the suite over time.

“The essence for these blueprints is that they provide the base configuration for a standard terminal of a specific type,” she explained. There’s no cost to using the standards and interested terminals can start piloting the Smart Projects today.

8 Different container port stakeholders were represented on stage at Navis World

CYBER FOCUS Another notable move is its strengthened focus on cyber security. Navis’ planned roll out of a Product Security Incident Response Team comes in tandem with the publication of a single document focused on security.

Michael Robinson, principal architect at Navis, said that with these two joint moves Navis is actively addressing the “worst that can happen”.

“Since we’re into more and more connections between products and third parties we have to think about how secure they are,” he says. “We have to take this extremely seriously.”

Rolled out in May, the new Product Security Incident Response Team is a “parallel processing team working on security issues”. PSIRT will follow a five-point cycle consisting of discovery, engineering analysis, mitigation/fixes, notification/ advisory, and customer retrospectives.

“The big concern with any application you have is the size of the surface area that is exposed,” Mr Robinson said. That ‘surface area’ is certainly growing as Navis actively expands its portfolio – Mr Robinson’s team have a task ahead of them to ensure that exposure is kept to a minimum.

For the latest news and analysis go to www.portstrategy.com/news

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BULK HANDLING: ATTACHMENTS

CRANE ADD-ONS MAKE LIGHT WORK OF BULK MOVES

Credit: Mantsinen

John Bensalhia investigates attachment options that look beyond pure container operations

TIMBER MOVES The ferrying of timber from port to vessel presents similar challenges of weight, variety of sizes, and slow labour. Spreader

48 | MAY 2019

attachments can also help to overcome issues with handling this cargo. Mantsinen’s grab attachments for timber are available in two formats depending on the amount of wood cargo to be moved. While the tip-to-tip attachment handles larger amounts of timber with ease, the by-pass alternative is more suited to lifting smaller loads or even individual logs.

Either option ensures quicker, precise timber carrying without the need for multiple workers.

Likewise, these benefits apply to Mantsinen’s sawn timber spreaders – available with manual or hydraulic length adjustment – which use automatic hooks to pick up and then release the wood.

Meanwhile, Stevenel’s wood pulp unit claims to raise wood pulp production by quite a margin, handling 450 tonnes per hour. Compare this with the more conventional kind of manual 8 Flinders Logistics’ unique Bulka Bag Spreader can load cargo without the need for staff being in the immediate vicinity

Credit: Flinders Logistics

Handling bulk cargo presents its own unique challenges – there is no getting around that fact. If its not containerised, bulk cargo damage, lengthy handling times, and, crucially, safety risks all need to be mitigated.

An often-overlooked piece of bulk handling kit has seen its design evolve to tackle all those concerns. Spreader manufacturers bolstered their attachment creations to better serve bulk cargoes, delivering the twin win of reduced harm to the cargo and safer and faster loading and unloading.

RAM Spreaders provides a wide range of attachments suitable for ports dealing with all kinds of bulk cargo. For the breakbulk market, the manufacturer has developed a Universal Pipe Handling Spreader. “This is capable of handling a wide variety of pipe lengths and diameters, making it suitable for a safer and faster quayside loading,” says Patrick Draper, public relations and communication at RAM SMAG Lifting Technologies (UK).

Pipe handling can pose a variety of difficulties for ports, such as safety risks (from the heavy, cumbersome pipes), as well as possible damage and wear and tear. It’s also a time-consuming process if done manually, with groups of workers having to carry large, heavy pipes one or two, if possible, at a time.

RAM’s Universal Pipe Handling Spreader makes this kind of operation safer, faster and more productive. Various sizes of pipes can be handled thanks to its separating telescopic quad beam system. The adjustable beams feature end grippers which have pipe protection plates that reduce the risk of pipe damage. With the technology deployed in the spreader, fewer workers are needed.

8 Mantsinen’s Quick Coupler allows the swap over of attachments in minutes

For the latest news and analysis go to www.portstrategy.com/news

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BULK HANDLING: ATTACHMENTS

STORAGE DEMANDS While the not-so-humble spreader attachment offers worthy benefits for ports, it’s a product that needs precise care and attention, not just during use, but also in storage. Spreader beams, in particular, should be placed in a dry environment at the right temperature, away from chemicals. Excess damp, heat, and toxicity can result in damage. The beams need proper inspection, both from a qualified professional on an annual basis, and by port staff after use to ensure that they are still suitable for future projects.

Safety-wise, some ports are providing their own spreader attachment solutions to boost safety levels when handling large scale cargo.

For example, the South Australian-based Flinders Logistics (a subsidiary of Flinders Port Holdings) is devising its own purpose-built spreader in-house. The Bulka Bag Spreader, made with lightweight polypropylene bags, features air release hooks which means that bulk products can be loaded on to vessels without the need for staff being in the immediate vicinity. Instead, workers can release the bags remotely from a distance, boosting safety levels.

The other side of the safety coin is the careless use of attachments. Spreader beams, especially, need special attention when being prepared for use. Sloppy planning can result in accidents, so port staff must have the right knowledge of the relevant health and safety rules. Also, great care must be taken when calculating the loads.

Poor preparation can cause damage to both cargo and beam. Pipes, for example, need the right length of beam. If the length of the pipe is longer than the beam, this then affects the force and compression of the load. The right balance must also be prepared accurately. While containerised bulk is more straightforward, awkwardly shaped cargo loads need careful evaluation before lifting in terms of judging where to place the beam hooks. If the cargo isn’t evenly balanced this can strain the mechanism of the beam hook, and can result in damage to the load.

SWITCHING CARGOES Using multiple spreader attachments can also prove to be a difficulty. A port handling a variety of bulk cargoes will want to switch spreader attachments quickly, easily and, of course, safely.

Mantsinen’s range of spreader attachments features two key components to ensure a swift change: a hydraulic quick coupling system and a fixed rotator system. If a port operator wishes to change attachments, the quick coupler allows the swap-over to be completed in minutes, using the MC620 or MC720 integrated rotor, which includes a built-in tool interchange attachment. Mantsinen’s attachments can also be used with other makes of crane.

Sheet metal coils are catered for with Elme’s slave attachment. Available in a single or double hook version, it's a solution that offers ports flexibility in that it comes in different sizes, styles and capacities. Similar flexibility is afforded by Elme’s steel slab grab unit (featuring hydraulic jaws) which is capable of dealing with different sizes and weights.

A watchword of spreader attachments is innovation, with varied solutions being devised for ports handling a variety of bulk cargoes. RAM SMAG’s Mr Draper explains that his

50 | MAY 2019

Credit: RAM Spreaders

spreader, which only manages 150 tonnes per hour. Using the Stevenel unit, loading time can, says the manufacturer, be considerably reduced from a turnaround of 27 hours to just nine. The pulp unit includes wires that either catch or release the material. Because of this, only one crane driver is required to oversee the operation, saving on manpower costs.

company, Peiner SMAG, provides various types of bulk handling grabs – from hydraulic clamshell grabs and orange peel scrap handling grabs to speciality grabs, such as the stone block grab, sugar cane grab and an underwater rope grab.

Environmental factors are also a key consideration for current and future spreader attachment manufacture.

Companies are aware of the growing wish to protect the environment. As RAM SMAG’s Mr Draper explains: “Producing greener and more efficient bulk handling operations is currently a hot topic and all too apparent with more countries now adopting strict environmental guidelines to help reduce pollution and emissions to become more energy efficient.”

He adds: “There is an increase in environmental awareness and the need for companies to adopt new systems. Our overall aim is to continue to help these companies reduce unnecessary financial burdens, increase profit and help them to reduce their carbon footprint.”

Spreader attachments require careful preparation and usage by ports. But investment in this equipment can produce vivid results in terms of boosted efficiency, environmentally sound solutions, increased safety levels and financial gains – all benefits worth getting attached to.

8 RAM’s pipehandling system improves handling speed and safety

Load and clear Safe handling of bulk cargo is paramount and it’s a given that the wrong use of machinery and equipment can lead to accidents. To that end, spreader attachment beam usages require exact planning before lifting occurs.

Port operators must ensure that they correctly calculate the load so that the cargo isn’t beyond the spreader attachment’s reach. As well as the cargo, the spreader beam and any extra accessories such as slings must be factored into the equation. Working out the precise weight will make sure that nothing goes wrong with the lift, thus avoiding potential accidents.

Devices such as the Straightpoint Radiolink Plus can aid operations for breakbulk and project cargo, as well as weighing and monitoring spreader beam loads. Boasting an efficient strength to weight ratio, Radiolink Plus features an update rate of 3Hz, and can be arranged to run at speeds of up to 200Hz. Added bonuses include the ability to glean data in real time, a compact design, and its ability to withstand tough environments and climates.

For the latest news and analysis go to www.portstrategy.com/news

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MAINTENANCE: CABLES

STRENGTHENING THE UMBILICAL CORDS OF PORT MACHINERY Cable carriers, also known as drag chains, energy chains (e-chains), or cable chains depending on the manufacturer, have been likened to the umbilical cords of modern machinery, reducing maintenance and increasing the service lives of cables and hoses.

They are guides which surround flexible electrical cables and hydraulic or pneumatic hoses connected to moving automated machinery. They may carry data and fibre-optic cables, or electricity, gas, air and liquids, reducing wear and stress on the cables and hoses, preventing entanglement, and improving operator safety.

They are deployed in moving plant such as cranes and forklifts, and therefore are of importance to the operation of marine terminals. It is a competitive environment and one in which several major suppliers work closely with ports.

From a port’s perspective, cable chains claim to offer benefits when compared with festoons.

German-headquartered igus developed plastic energy chains in 1971 and in 2017 surpassed 1,000 STS crane e-chain systems installed worldwide. The company’s engineered systems manager for igus North America, Sean McCaskill, says the biggest difference is that energy chains only require periodic visual inspection.

“They are maintenance and lubrication free and resistant to moisture and ultraviolet rays. They also save space and are easier to replace than festoon systems.”

Mr McCaskill says energy chain systems require less preventative and corrective maintenance than festoon systems.

“There are no wheels, shock cords or other parts that need to be replaced at regular intervals. New designs are predicted to operate for up to 20 years without parts being marked for regular service or replacement.

“Also, they are simple systems that require no additional controls or motors to operate at high speeds.”

HANDS-OFF The mastery of being able to offer a product to a port or marine terminal, he says, is in “getting it to run for ten years in that environment without touching it”.

E-chains can also be equipped with smart sensors, which Mr McCaskill says is indicative of an industry utilising every advantage it can get to gain a competitive edge.

“Predictive maintenance and monitoring systems are at the forefront of that push. The iSense system allows insight that was never possible before, into the operational status of your equipment.

“The first generation of smart sensors from igus could do things like shut down the crane in case of the failure of a system. The second generation can send you warnings before a failure event happens by monitoring performance in real time and picking up abnormal operation conditions before they become real problems.

“These sensors can monitor for energy chain system disconnection of links; over/under push-pull force values during operation; wear and life

52 | MAY 2019

Credit: igus

Dave MacIntyre finds out if crane cable chains deliver everything they promise on reduced maintenance and increased service lives

prediction; cable tension; conductor life inside cables; and rising of the upper run of the energy chain system due to blockage. The system alerts operators when something starts to go wrong before a failure occurs.”

FESTOON DISADVANTAGES Cosimo Lupo, export sales senior manager for the Italian-based manufacturer Brevetti Stendalto, says that while the advantage of a festoon system is that it is less noisy than chains, there are several disadvantages.

“Festoon cables have to be as long as 1.6 times the travel distance they have to cover. The cables lodged into a centrefed energy chain will be as long as 0.6 times the travel distance they have to cover.”

He adds that festoon cables are always bent in the same points, which means that both the copper of the conductors and the plastic material of the sheaths can “get to their fatigue limits within a quite limited number of cycles”. Consequent breakages can lead to serious safety troubles or to service being halted.

Further, the high winds that marine applications can be exposed to may cause the hanging cables of festoons to be twisted with possible work interruption. “Off-shore installations do not allow hanging cables for safety reasons,” he points out.

Mr Lupo says motors, carts, guide rails and pulling ropes require constant maintenance in outdoor applications. “The original set of cables cannot be easily changed in case [more are] required during the life of the system.”

Because some festoon cables are of a special design, they also require big industrial batches to be produced.

He compares this with Brevetti’s chain systems which are designed to facilitate easy replacement of the parts subject to wear during the planned stops of the cranes.

8 Cable chains offer benefits over festoons

8 Tsubaki Kabelschlepp’s Peter Sebastian Pütz says a cable chain system is the only system you can use for all kinds of media at the same time

For the latest news and analysis go to www.portstrategy.com/news

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MAINTENANCE: CABLES

“This means that the operating life of our chains can be extended to the life expected for the cranes themselves,” he says.

SAFER SPACE-SAVERS Another major player with 65 years’ experience in the cable carrier sector is Germany’s Tsubaki Kabelschlepp, which supplies everything from small plastic cable carriers and guide single cables up to huge stainless steel heavy duty cable carriers for rig skidding applications on offshore oil rigs.

Asked to compare the benefits of different types, Peter Sebastian Pütz, the company's head of strategic marketing and head of crane division, says guiding cables with a cable carrier instead of a festoon system is a safer and more modern way for crane applications and also saves space.

“A cable carrier system is directly installed under the main beam with a system height of approximately less than one metre. No down-hanging loops which can be caught up by the crane steel structure. No loop station, no additional steel structure – to store the festoon loops you need approximately 10% of the travel way additional steel structure.

“This is not necessary with a cable carrier system. The end of the crane beam is at the same time the end of the cable carrier. There are no additional drives – a cable carrier will be pushed and pulled by the trolley. For fast-running cranes you don't need any additional drives like you need with fast-running festoon systems.”

Having no additional drives also means there is no need for an additional control system to synchronise the trolley with the cable management system.

Mr Putz says a cable chain system is the only system you can use for all kinds of media at the same time, such as cables, hoses and fibre optics, which can be guided in one system.

STRESS TESTED Another benefit of cable chains is the reduction of mechanical stress for cables. Even if a crane is not running, festoon cables are always moving due to the travelling trolley, the gantry travel and wind effects.

“You don’t have this situation with cable-carrier cables. They are installed inside the cable chain and the cable carrier is moving smoothly back and forward with less mechanical stress to cables and hoses.”

Maintenance is also easy, with no greasing, no roller changes and no bungee rope change. Mr Putz says every mechanical

8 Tsubaki Kabelschlepp advises that the application defines the type and material of the cable needed

system which is installed on a port crane needs some maintenance, but this may be minimal. “Crane cable carriers from Tsubaki Kabelschlepp just need some visual inspection, that’s all,” he says. “Most of our port crane customers are expecting ten years lifetime independently from operation hours.”

For marine terminals, Tsubaki Kabelschlepp recommends hybrid cable carriers which consist of plastic side parts and seawater-resistant aluminium crossbars. The company says these crossbars are much better gliding partners for cables than glass-fibre-reinforced plastic crossbars.

Asked what advice Tsubaki Kabelschlepp would give to a port or marine terminal looking to make an investment in cabling systems, Mr Putz says he would suggest a personal visit to the company's headquarters in Germany to get advice on the right cable carrier for their needs. The company has a test laboratory for all kinds of cable carriers and an outdoor crane test facility.

Virginia switch proves a success

54 | MAY 2019

8 Virginia selected igus e-chain systems for its new equipment

Credit: Port of Virginia

The Port of Virginia has expanded operations in recent years and was awarded $15.5m for improvements by the federal government in 2018.

It selected igus e-chain systems for the all of its new equipment at Virginia Inland Port and Norfolk International Terminals.

Jeff Johnstone, crane maintenance manager at the Port of Virginia, says the port had used a wheeled festoon port for years.

“Bearings, bolts, shock cables, tow cables – all of those components need to be maintained monthly and replaced quite often.

When we switched to the energy cranes, all of that went away.

“In the first year they were in service, we

were waiting for something major to go wrong and it just didn’t happen. The maintenance we had to do was minimal compared to the maintenance we had to do with the wheeled festoon systems.”

Danny Webb, the port’s general manager of technical support and special projects, confirms that the reliability of the new system was the biggest surprise, and has contributed to other ports taking notice of Virginia.

“Cranes are getting bigger, they’re getting taller, they're getting faster. It’s impressive to see the amount of technology on one piece of equipment.

“The size of the port, and the projects we’re undertaking, and the aggressiveness we’re going after is unrivalled. Now, everybody’s thinking 'What's Virginia doing?’,” he says.

For the latest news and analysis go to www.portstrategy.com/news

PRODUCTS & SERVICES: DIRECTORY

500 Seventh Avenue New York, NY, 10018, USA Tel: +1 646 908 6550 Patrick.King@jacobs.com www.jacobs.com/capabilities/ transportation

For the latest news and analysis go to www.portstrategy.com/news

G-SERIES

Dellner Dampers is an innovative Swedish company that supplies solutions to mitigate vibrations and absorb kinetic energy. Standard and customised buffers and dampers for port side applications such as cranes, spreaders and more. All designed and produced in Sweden.

Tel: : +46-(0)157-45 43 40 Fax: +39 049 8848006 Email: info@dellnerdampers.se Web: dellnerdampers.se

Gantrex Founded in 1971, Gantrex is the global market leader in production, distribution, installation and maintenance of high quality crane rail solutions. Gantrex offers its products and services across the world and operates four production sites in Belgium, Spain, Canada and China. Gantrex products are used in many different applications including ports, shipyards and heavy industries.

DEME NV DEME has almost 175 years of experience in dredging and land reclamation activities, hydraulic engineering and executed major works of marine engineering infrastructure.

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LASE offers innovative and productive solutions for ports by combining state-of-the-art laser scanner devices and sophisticated software applications. We are specialised in the fully automated handling of containers, cranes or trucks.

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C ONTAINER TERMINALS

For more than a century, Bedeschi is providing effective and reliable solutions in a wide variety of industries (bulk handling, marine logistics and mining), capitalizing on synergies and cross competences.

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Stäubli Electrical Connectors AG As one of the leading manufacturers of quick connector systems, Stäubli covers connection needs for all types of fluids, gases and electrical power. +41 61 306 55 55 ec-ch@staubli.com www.staubli.com/en-ch/ connectors/

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MAY 2019 | 55

PRODUCTS & SERVICES: DIRECTORY

Gerbestr. 15, 6971 Hard, Austria T: +43 5574 6883 0 sales@kuenz.com www.kuenz.com

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CAMCO Technologies NV Visual- and Micro Location- assisted process automation solutions for container, ro-ro and rail terminals worldwide. Accurate crane, gate & rail OCR systems and Gate Operating System software helping terminals accelerate terminal and gate activity.

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Liebherr provides advanced maritime cargo handling solutions with a focus on quality, innovation and performance. With more than 50 years’ experience in vessel handling and container stacking, Liebherr supplies premium port equipment for highly efficient port operations across the globe.

Grabs of MRS Greifer are in use all over the world. They are working reliably and extremely solid. All our grabs will be made customized.

Besides the production of rope operated mechanical grabs, motor grabs and hydraulic grabs we supply an excellent after sales service.

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CERTUS provides Automatic Container Recognition systems in ports and terminals all across the globe. Our systems have consistently demonstrated high reliability and overall high OCR accuracy, streamlining customer operations.

Check out our Mobile OCR! www.certus port automation.com +31 78 6815196 The Netherlands

Sany Europe GmbH

Over 40 years experience constructing and manufacturing a wide range of grabs, including electro-hydraulic grabs (with the necessary crane equipment) radio controlled diesel hydraulic grabs, 4, 2 and single rope grabs all suitable for bulk cargo.

SANY offers reliable quality container handling trucks.

Benefit from the experience of over 4,000 reach stackers build over the last 12 years, with up to five year full machine warranty.

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Marconibaan 20 Nieuwegein Netherlands 3439 MS Tel: +31-30-6062222 Fax: +31-30-6060657 info@verstegen.net www.verstegen.net

56 | MAY 2019

1-Stop is a globally recognised leader in innovating and delivering integrated solutions to increase productivity for the Port Community. We are committed to working collaboratively with all members of the community to deliver efficiency gains for everyone.

PO Box 204, Rockdale, NSW, 2216 Australia Tel : +61 2 9588 8900 (Intl) Email: info@1-stop.biz Web: www.1-stop.biz

To advertise in the The TT Club is the international transport and logistics industry’s leading provider of insurance and related risk management services.

TT Club specialises in the insurance of liabilities and equipment for multi-modal operators.

90 Fenchurch St London • EC3M 4ST Tel: +44 207 204 2635 london@ttclub.com www.ttclub.com

Port Strategy Directory contact Tim Hills on

+44 1329 825335 www.portstrategy.com

S IDELIFTER/SIDE LOADERS

Verstegen is worlds leading manufacturer of rope operated mechanical grabs for the dry bulk industry. Stevedoring companies and ports are using our grabs for handling all kinds of bulk materials.

I NSURANCE

Verstegen Grijpers BV

Sany Allee1 D-50181 Bedburg Tel: +49 2272 90531 100 Email: info@sanyeurope.com www.sanyeurope.com

1-Stop Connections Pty Ltd

ShibataFenderTeam Group ShibataFenderTeam is one of the leading fender manufacturers with 50+ years of group experience and an extensive global network.

As a specialist for customized fender solutions, they focus on vertical integration with in-house manufacturing and full scale testing, offering high quality products at competitive prices.

SFT offers the full range of marine fender products. info@shibata-fender.team www.shibata-fender.team

P OWER TRANSMISSION

Orts GMBH Maschinenfabrik

VISY Oy VISY takes pride in solving operational problems, specialising in gate automation and access control solutions in ports and terminals. Their solutions streamline processes resulting in saving money and increasing productivity.

Tel: +358 3 211 0403 Email: sales@visy.fi Web: www.visy.fi/

M ARINE FENDERS

G RABS

Liebherr-MCCtec Rostock GmbH

MRS Greifer GmbH

I T PORT AUTOMATION

Künz GmbH Founded in 1932, Künz is now the market leader in intermodal rail-mounted gantry cranes in Europe and North America, offering innovative and efficient solutions for container handling in intermodal operation and automated stacking cranes for port and railyard operations.

I T PORT AUTOMATION

Alimak, the leading manufacturer of rack and pinion elevators, have been successfully servicing ports since the early 1970s with close to 3,000 elevators installed, providing easy access for crane drivers, which enhances productivity and profit. Today, the company’s crane elevators are installed in almost 100 countries around the world.

H ANDLING EQUIPMENT

E LEVATORS

Alimak Group Sweden AB

Conductix-Wampfler The world specialist in Power and Data Transfer Systems, Mobile Electrification, and Crane Electrification Solutions.

We Keep Your Vital Business Moving!

Rheinstrasse 27 + 33 Weil am Rhein 79576 Germany Tel: +49 (0) 7621 662 0 Fax: +49 (0) 7621 662 144 info.de@conductix.com www.conductix.com

Hammar Maskin AB Hammar Maskin AB is developing, manufacturing and marketing Sideloaders, also known as Sidelifters, Swinglifters or Self loading trailers, under the brand name HAMMAR™.

Buagärde 36, Olsfors 517 95 Sweden Tel: +46-33 29 00 00 Fax: +46-33 29 00 01 info@hammar.eu www.hammar.eu

For the latest news and analysis go to www.portstrategy.com/news

PRODUCTS & SERVICES: DIRECTORY

Bromma is the industry’s most experienced spreader manufacturer, known worldwide for crane spreaders of exceptional reliability.

Today you find Bromma spreaders operating in 97 out of the top 100 ports worldwide.

Malaxgatan 7 , P.O. Box 1133 SE-164 22 Kista, Sweden Tel: +46 8 620 09 00 Fax: +46 8 739 37 86 sales@bromma.com spareparts@bromma.com

Coda Octopus is a global leader and specialist in underwater technologies.

Our patented flagship product, the Echoscope®, is the world’s only real-time 3D volumetric imaging sonar, giving operators the ability to visualize and map the subsea scene in real-time 3D.

Port Strategy Directory contact Tim Hills on

+44 1329 825335 www.portstrategy.com

The Brain of Logistics With more than 30 years experience in IT Solutions and Business Operation Consultancy DSP offers a large portfolio of professional services and products to support terminal operations processes and system.

DSP Data and System Planning SA Via Cantonale 38 6928 Manno, Switzerland Tel: +41 91 230 27 20 Fax: +41 91 230 27 31 info@dspservices.ch www.dspservices.ch

Master Terminal TOS from Jade Logistics solves the complex problem of managing a variety of mixed cargo within one system, providing the agility you need to manage your port. Designed to cater for all cargo types, it is the TOS of choice for mixed cargo terminals.

5 Sir Gil Simpson Drive Christchurch 8053 New Zealand PO Box 20152 E: info@jadelogistics.com W: www.jadelogistics.com

Solvo Europe B.V. Solvo’s software solutions such as TOS or WMS help container and general cargo terminals take full care of their cargo handling processes and make sure the clients expectations are exceeded.

Prinses Margrietplantsoen 33, 2595AM, The Hague, The Netherlands Tel: +31 (0) 702-051-709 Email: sales@solvosys.com www.sovosys.com

TGI Maritime Software is a Terminal Operating System editor and integrator specialized in the support of Small to Medium Terminals. Its expertise is built on 34 years of experience within the maritime sector. TGI provides comprehensive services to its customers all along their projects. OSCAR TOS and CARROL TOS have already been successfully handled by 40 container and RoRo terminals worldwide.

Tel : +33 (0)3 28 65 81 91 contact@tgims.com www.tgims.com

Providing complete solutions for your container cranes Refurbishments & Upgrades – Maintenance – Training – Inspections & Audits – Safety Lashing Cages – Spares & Service Support www.wcs-grp.com/ info@wcs-grp.com T: +971-4-8838980

T RACTORS

To advertise in the

T ERMINAL OPERATING SYSTEMS

ELME Spreader AB ELME Spreader, world’s leading independent spreader manufacturer supports companies worldwide with container handling solutions that makes work easier and more profitable. Over 18,000 spreaders have been attached to lift trucks, reach stackers, straddle carriers and cranes.

Stalgatan 6 , PO Box 174 SE 343 22, Almhult, Sweden Tel: +46 47655800 Fax: +46 476 55899 sales@elme.com www.elme.com

Worldwide: +44 131 553 1380 sales@codaoctopus.com US +1 863 937 8985 Salesamericas@codaoctopus.com www.codaoctopus.com

Navis understands that as ships get larger and operational processes become more complex - efficiency, collaboration and productivity are essential. As a trusted technology partner, Navis offers the tools and personnel necessary to meet the requirements of a new, and ever-evolving, global supply chain.

World Headquarters 55 Harrison Street Suite 600 Oakland CA 94607 United States Tel: +1 510 267 5000 Fax:+1 510 267 5100 Web: www.navis.com

T ERMINAL OPERATING SUPPORT

Coda Octopus

T ERMINAL OPERATING SYSTEMS

S UBSEA

S PREADERS

Bromma Conquip

MAFI Transport-Systeme GmbH Specialised in the development and production of heavy-duty equipment for transporting containers, semi-trailers, cargo/roll trailers and special container chassis in ports and industry.

Hochhäuser Str 18 97941 Tauberbischofsheim, Germany Tel: +49 9341 8990 sales@mafi.de www.mafi.de

Terberg Special Vehicles develops and manufactures customised tractors. Our terminal, RoRo, industrial and road/rail tractors operate in ports, distribution centres, shunting yards, industry and construction sites worldwide.

We believe efficient operations depend on high quality, easy maintenance and operator comfort.

Benschop – The Netherlands Tel. +31 348 45 92 11 terbergspecialvehicles.com

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Email subscriptions@greenport.com or call +44 1329 825 335 • Comprehensive online directory • Instant access to industry news • eNewsletter • Magazine subscription • Expert opinion

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For the latest news and analysis go to www.portstrategy.com/news

MAY 2019 | 57

POSTSCRIPT

VANCOUVER PUBLIC HEARING COMMENCES

Will the current environmental assessment of the Roberts Bank Terminal 2 project facilitate its implementation or will credence be given to new market-related objections that suggest it is no longer viable?

The long lingering saga over the proposed Roberts Bank Terminal 2 project in Vancouver, Canada is set to arrive at an important way point on May 14, 2019 when the Review Panel established to conduct an environmental assessment of the planned new container terminal facility commences a public hearing. The hearing in the words of the Canadian Environmental Assessment Agency, “… is designed to address many of the topics the Panel and the public remain concerned about it.”

It follows on from the Review Panel concluding that the time is right for the information on the project provided by the Vancouver Fraser Port Authority to be discussed at a public hearing. Participation in the public hearing is open to all parties including the general public who can do so by filing a written submission or making an oral statement.

Strong environmental objections have been made against the Terminal 2 project not the least of which is that the proposed development site is the resting ground for “hundreds of thousands of western sandpipers migrating to spring Arctic breeding grounds.

These birds,” say environmentalists, “feed solely on an algae that is only available on the Roberts Bank mudflats. That algae cannot be moved or replaced, meaning that this important bird migration on the Pacific Flyway would be extinct with port expansion.”

In response to this the Vancouver Fraser River Port Authority underlines the comprehensive studies it has undertaken into this subject and other aspects of environmental impact – effect on fish and fish habitat, endangered Southern Resident Killer Whales and other marine mammals – as well as its extensive proposed mitigation and offset measures.

SCOPE AND NEED The project as proposed by the Vancouver Fraser Port Authority is large scale and determined as fundamentally necessary to keep pace with trade development through the port of Vancouver and the consolidation and expansion of the economic benefits this brings. The scheme foresees a three berth container terminal, located next to the existing Deltaport and Westshore terminals, with supporting infrastructure

58 | MAY 2019

8 Some observers already see Vancouver’s main container terminals as under pressure – hence, for example, the choice of certain lines to operate on the Fraser River

developments to provide landside access to the terminal and an expansion of the tug basin connected to the northeast side of the Deltaport Terminal. Operating at full capacity the terminal is designed to process up to 260 container ship calls per annum.

In 2018 container volume in Vancouver, moving via all the port’s container terminals including the downtown terminals as well as the capacity on the Fraser River, comprised 3.4m teu representing a 4.4% increase over 2017. In the very near future, by the mid-2020s, the port of Vancouver stresses that traffic forecasts confirm Canadian west coast container ports will effectively be full and unable to accommodate new business unless substantial new capacity is provided.

At a practical level, there already seems to be some evidence to support this view: the migration of container lines using smaller vessels unrestricted by draft to the Fraser River multi-purpose terminal facilities and the rise and rise of Prince Rupert as well as the extremely high utilisation rates of the main Vancouver container terminals when difficult operational circumstances arise, such as bad weather causing container vessel bunching and rail system problems.

The issue of demand and need for Terminal 2 does, however, now have an added edge to it with the submission to the Review Panel of Global Container Terminals (GCT), operator of Deltaport, which contends that based on changed market factors the project is no longer viable. It cites both demand-related factors and shipping system trends that impact port capacity planning. GCT has already put up an alternative scheme which would see it add capacity at its own facility but as the Port Authority points out this is not viable as Fisheries and Oceans Canada has prohibited further land reclamation inland from Deltaport and, at a market level, the expansion of Deltaport would place too much power in the hands of one operator.

The conclusions of the Review Panel promise to be interesting – the critical question being will it, at long last, provide the key to unlocking the door to the implementation of Terminal 2?

For the latest news and analysis go to www.portstrategy.com/news

SOMEBODY BETTER GET MYTHBUSTERS DOWN HERE Was it aliens? Ancient man? A time-travelling Bromma spreader? No one knows for sure. But one thing is certain: some things get old, others get replaced.

Look around in a port and you’ll notice our spreaders look a little older than the rest. More used. That’s the difference Bromma quality and after-sales support makes. It means our spreaders last longer than others. But unlike Stonehenge, no one will ever wonder why they are there.

Join us at TOC Europe 18–20 June, stand E44.

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