First US Venture for ICTSI

- Managers at the US Port of Portland want to lease Terminal 6 (T6), Oregon’s only container facility, to Manila-based International Container Terminal Services Inc., (ICTSI). According to The Oregonian, port officials have confirmed the lease proposal but said they would not make the terms public until later.

The 25-year concession agreement will transfer operations and marketing, but not security, to ICTSI which will be required to invest in improvements at the Columbia River terminal which has struggled for years to attract and retain shipping lines because of its location about 100 miles from the Pacific Ocean. Last year T6 handled more than 87,000 40-foot containers.

According to the port, placing the terminal in the hands of a global player has a lot of merit. The Portland deal, they said, would be a lease rather than a sale and would bring the Port in line with other West Coast ports that outsource terminal operations. The Port already leases terminals to private companies, including Japanese and Canadian firms.

Port managers began confidential negotiations with ICTSI a little over a year ago and under the proposed agreement ICTSI would lease T6 container and break-bulk operations, but not the auto facilities. The company would pay an annual lease fee plus some reimbursables to the Port for services including security.

The Port commission’s nine members will consider the proposal during a public meeting on Wednesday May 12 and decide whether to place the state’s main marine hub in the hands of a foreign company that has never run a US operation.

Port managers will argue that a globally connected company can drum up more business, marketing the benefits of a newly deepened Columbia River shipping channel that allows passage of bigger ships. The arrangement would fundamentally differ from DP World’s proposal in 2006 to sell six US seaports to a company based in the United Arab Emirates. That project attracted international attention and became controversial when opponents argued the sale would jeopardise US national security.

(Source: Container Management)