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Three Qualify For Las Americas Port Concession… PSA Short-Listed

Three Qualify For Las Americas Port Concession

August 8, 2003
Copyright © 2003
Business News Americas ( All rights reserved. 

Fluor CorporationFLR

Three groups have qualified for a design-build-operate-transfer concession for Puerto Rico's Las Americas port (PLA), though other interested firms may still enter the competition, project official Edgardo Torres-Caballero told BNamericas.

The three qualifiers are: Manila-based International Container Terminal Services Inc (ICTSI); Singapore's PSA; and Dutch-US consortium Main Ports of Puerto Rico Inc-Fluor.

Officials will launch the request for proposals phase, and plan to select an operator - with all permits in place - by May 2004, said Torres-Caballero, assistant secretary of strategic projects for the commonwealth's economic development and commerce department.

Construction will take close to three years and is slated to start by the Northern Hemisphere's 2004 summer.

Planners have reduced estimated project costs to US$600mn-700mn from US$1bn through "streamlining" the design, he said. Still, the commonwealth's designs are "conceptual," as the concessionaire will finalize this part of the process.

"We will be favoring any private participation and investment in the project," the assistant secretary said, adding Puerto Rico's government is committed to providing project funds.

The concessionaire's required investment levels have not been finalized. Its contract will be 20 years plus.

Las Americas will occupy twin sites at Ponce and Guayanilla, with a maximum capacity of 2.2M TEUs. The port's proximity to major shipping routes is an advantage, though its location off the US mainland could be a factor, as US cabotage laws would prevent foreign ships from transporting cargo from the port to US destinations.

Specifically, the law, which falls under the US Jones Act, is the restriction of domestic cargo and cruise markets to vessels owned, built, documented and manned in the US.

But US representative to Hawaii Ed Case is spearheading an effort to change this law, and has introduced three bills in congress to exempt Hawaii and other non-contiguous US locations from the Jones Act.

"These bills provide that all foreign shippers operating under Jones Act exemptions must comply with the same labor, environmental, tax, documentation, US locus and other laws as are applicable to non-US flag ships and shippers transiting US waters today," Case told a House audience July 24.

Case may be fighting an uphill battle, as US labor unions and some shipping companies have lobbied hard against amending Jones in the past, seeing it as protection against foreign labor in domestic shipping markets, a congressional source told BNamericas.

Though few will likely come out in support of the lawmaker's proposals, Las Americas port officials have been eager to amend the law.

"Our position is looking for consensus," Torres-Caballero said. "We want to build consensus between the labor unions, shipping lines, the US government and the Puerto Rico commonwealth."

PSA Short-Listed For Puerto Rico Port Project

By Donald Urquhart

August 13, 2003
Copyright © 2003
Singapore Press Holdings Limited. All rights reserved. 

The Shipping Times

It is one of 3 qualifiers bidding for concession to run box terminal

(SINGAPORE) PSA Corporation has been short-listed as one of three current qualifiers for Puerto Rico's Port of the Americas container terminal project after submitting its proposal late last year.

The government of Puerto Rico - a Commonwealth linked to the United States - announced recently that International Container Terminal Services Inc (ICTSI) from the Philippines, a Puerto Rican-Dutch consortium and PSA Corporation were all qualifiers for the project, according to a Fairplay report.

Citing sources in the country's economic development department, the report said other interested bidders whose proposals qualify will also be considered prior to the May 2004 selection of the successful tender.

Last year, PSA's former International Business Division head, Goon Kok Loon, confirmed that the Singapore terminal operator had submitted a bid.

But when asked for comment on this most recent development a PSA spokesman said yesterday: 'We do not comment on specific projects but we always remain open to opportunities for win-win collaborations and sustainable partnerships that make sense to all partners and parties involved.'

The bidding is for a 25-year concession to run the container transhipment port, which is targetting 2.5 to 3 million TEUs (twenty-foot equivalent units) in annual volume between two terminals in the port cities of Guayanilla - the second busiest port in the country - and Ponce.

The aim is to turn Puerto Rico, already the largest domestic import-export container cargo market, into the leading Caribbean transhipment hub capable of handling post-Panamax vessels of up to 12,000 TEUs.

The project was originally targeting a total investment of US$1 billion, but has been reportedly scaled back to US$700 million for unknown reasons.

The project includes building four container berths in Guayanilla and two in Ponce, both located on the island's southern coast. Dredging is expected to begin next February with the first phase opening in 2005 earliest.

The country's busiest port, the Port of Puerto Nuevo, located in the capital of San Juan, handled nearly 1.7 million TEUs in 2002.

Among the lines calling in Puerto Rico are: Maersk Sealand, Evergreen Marine Corp, P&O Nedlloyd, APL, Crowley Liner Services, CSX Lines and Sea Star Lines.

The government is hoping to capitalise on its stable political system, strong import market and close links with the US. Tax breaks and other incentives will be used to increase the attractiveness of the hub with shipping lines. A 1,000 acre free trade zone is also being planned.

The Fairplay report also noted that the Puerto Rican government has said it plans to ask Washington to amend the Jones Act - which the island is also subject to - to allow foreign flagged ships to move cargo from the island to the US.

Sceptics of the project point to the country's relatively higher labour costs compared with neighbouring countries, due to its use of the US minimum wage rate.

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