THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, April 24, 1995 TAG: 9504220227
SECTION: BUSINESS WEEKLY PAGE: 14 EDITION: FINAL
TYPE: Cover Story
SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER
LENGTH: Long : 150 lines
Hampton Roads, already the second largest port on the East Coast, enjoys one commodity other ports don't - land to keep growing.
And now the open land is coming in handy.
In part due to forecasts of more trade with Latin America and Southeast Asia, the port has begun a $400 million expansion to handle an anticipated doubling of the tonnage moving through Hampton Roads.
The expansion is centered on about 300 acres of vacant land at Norfolk International Terminals, where construction has already begun to meet the anticipated needs of growing international trade.
``That's really a luxury,'' said Erik Stromberg, president of the American Association of Port Authorities. ``So many of the ports on the East Coast and to some extent on the West Coast just don't have land to expand.''
The port of Hampton Roads, which helps support nearly 120,000 jobs in the state, posted its best year ever in 1994. Nearly 8 million tons of general cargo was imported and exported through the port, making Hampton Roads the second largest port on the East Coast after New York.
Most of that tonnage went through port terminals in Norfolk, Newport News and Portsmouth owned by the Virginia Port Authority, an independent state agency.
The port authority has overseen the port's dramatic growth since 1982 when the terminals were placed under unified ownership and management. Before then the terminals competed as much with each other as with other ports on the East Coast. The port muddled through the 1970s with annual cargo tonnage of about 3 million tons.
To sustain the port's strong growth into the next century, the port authority plans to invest nearly $100 million in the port's terminals during the next five years and more than $400 million by 2015. Investment in expanding terminal infrastructure should enable the port to continue to grow and meet the demand of growing international trade.
A consultant's study due in May will show that the port needs to expand to meet an anticipated doubling in cargo tonnage by 2010.
``If you look at the customers we have now and figure they grow at 3 to 5 percent a year, you're going to eat up a lot of space by the year 2010,'' said J. Robert Bray, executive director of the port authority.
Much of that growth will flow through Norfolk International Terminals - known as NIT - where there's land available for expansion. There's not much room for growth at the port's other terminals - Portsmouth Marine Terminal and Newport News Marine Terminal - though facilities at both can be improved.
``The majority of the growth would occur at NIT, the majority of the growth would be in containers and would require intermodal rail connections,'' said John Vickerman, president of Vickerman Zachary Miller, the consulting firm completing the study on the port's growth.
The port authority owns about 300 acres of waterfront between the existing NIT terminal and the Norfolk Naval Base. It bought most of that land in 1984 from Exxon, which operated a terminal and tank farm on the site. It bought the Sewell's Point pier at the north end of the property from Norfolk Southern Corp. a few years ago.
The first phase of NIT's expansion is already underway. Contractors are preparing the site and paving before construction begins later this year.
The first phase involves the construction of 1,000 feet of wharf and 44 acres of container storage area. Three container cranes will be purchased as well to unload ships in the area.
Construction on the $90 million project will begin later this year and should be completed in 1998.
The authority has already received all the state and federal permits required to dredge the portion of the Elizabeth River fronting the expansion area up to 45 feet deep.
The project will be financed by the port authority's share of the Virginia Transportation Trust Fund, a pool of state money generated by transportation-related taxes; revenue bonds and revenues from Virginia International Terminals Inc., the private, nonprofit company that manages the terminals for the port authority.
While the port authority gets about $22 million a year from the state transportation fund, it will probably have to issue more port revenue bonds in 1996 to help finance the expansion, Bray said.
``The critical thing to me is to bring the one berth on line as quickly as possible plus expand the intermodal access,'' Bray said.
Intermodal shipping involves the ready transfer of containers between ship, truck and rail. A big part of Hampton Roads' success through the 1980s was due to the intermodal rail service provided by Norfolk Southern.
``This intermodal connection to Norfolk Southern is a big advantage for Hampton Roads because they have the best rail connection to the Midwest,'' said Dave Rudolf, director of engineering and maintenance for Virginia International Terminals. ``The fact that it's on dock makes it even better.''
Norfolk Southern can assemble and load double-stacked container trains right on the port terminal. Many other ports including New York don't have the access to provide the efficient double-stacking of containers on trains.
``That's highly coveted throughout the United States,'' Stromberg said.
And the port authority is working to improve that intermodal access. It's spending $1.7 million to pave, drain and light a new rail loading area along the tracks between Hampton Boulevard and NIT. That ``intermodal ramp'' should be complete by October.
The Virginia Department of Transportation is working on a study of rail access to NIT that will likely result in a recommendation to get the road off the tracks at the intersection of Terminal and Hampton boulevards. While a costly engineering project, such a grade separation would result in easier movement of both rail and truck and automotive traffic.
The study is also pondering separating the grade where tracks cross Hampton Boulevard into the expanding northern end of NIT.
``There's enough land for us to handle our expansion needs of the next 10 to 15 years,'' Bray said.
Eventually the authority will extend the wharf to stretch between Sewell's Point docks and the existing terminal, more new container cranes will be installed and an overhead crane system will be developed and placed.
The total project costs will be about $400 million by 2015.
After that the port authority has designs on the Navy's Craney Island Supply Depot, which is where dredgings in the port have been dumped for years, Bray said.
``The potential is here to handle the capacity demands. . . ,'' Stromberg said. ``Trade is going to grow.''
He cited the Latin American trade, which is growing at up to 30 percent a year.
``We are situated better (than other ports) to attract that South American trade and move it inland,'' said Joseph A. Dorto, general manager and chief executive of Virginia International Terminals.
``And Asian trade through the Suez Canal is only going to grow,'' Stromberg said.
As manufacturing grows in Southeast Asia and India, shipping through the Suez to the East Coast will grow in importance as well. On a joint service by Neptune Orient Line and NYK Line, it's faster by 14 days to ship through the Suez Canal to New York from Singapore and by eight days to Norfolk, than it is to ship through the Panama Canal. ILLUSTRATION: Color staff photos by Bill Tiernan
The view from NIT's control tower shows acres of cargo containers.
Empty space at the terminal is expected to fill with even more cargo
in the next 20 years.
Intermodal shipping, the ready transfer of containers between ship,
truck and rail, is a big part of the port's success. Officials are
including better intermodal access in their expansion plans.
Containers of goods line the pier at Norfolk International
Terminals.
Staff color graphic by John Earle.
Source: Norfolk International Terminals.
NORFOLK INTERNATIONAL TERMINALS
[Expansion Plans]
For copy of graphic, see microfilm.
KEYWORDS: NORFOLK INTERNATIONAL TERMINALS HAMPTON ROADS PORT by CNB