Virginia Port Authority to lease APM Terminals Virginia

APM Terminals Americas and the Virginia Port Authority have reached agreement for the Virginia Port Authority to lease APMT's Virginia Terminal for US$40 million over a period of 20 years.

Under the agreement, APM Terminals Virginia will continue to own the terminal and major assets, and all operations will be taken over by the Virginia Port Authority's operating arm, Virginia International Terminals. A number of details, including the transition timeline, will be finalised in the coming weeks, a statement from APMT said.

"There is no doubt that our Virginia facility is one of the world's best, but it, like other container terminals in Hampton Roads, has been underutilised," said Eric Sisco, president of APM Terminals Americas.

"This facility is designed for high volume and high utilisation. By combining the available assets and capacity in the port through the lease of our facility, we are creating value for all of our stakeholders," he said.

"APMT will continue to participate in this market through our lease arrangement, the future development of APMT2, and the continued presence of our Americas regional headquarters at the facility," said Mr Sisco.

Speaking at the 90th annual Virginia Maritime Association banquet in Norfolk, Virginia Governor Bob McDonnell said: "Combining this incredible facility with our natural assets will substantially increase the marketability of this port and position Virginia to become the leading port on the east coast faster than we anticipated."

However, the agreement must still gain the approval of the Virginia Port Authority Board of Commissioners and their counterparts at APM Terminals headquarters in The Hague.

APM Terminals Virginia, a US$450 million, 291-acre container facility with an annual container handling capacity of one million TEU and potential to more than double that, opened in July 2007. Maersk Line and Evergreen currently call at the terminal.

A report by the Associated Press quoted Virginia Transportation Secretary Sean Connaughton as saying: "Taking over APM's new, highly automated facility will vastly improve the efficiency of the port authority's operations, while delaying the state's need to spend billions to develop its own state-of-the-art terminal at Craney Island."

It said that according to the governor's office, "national and global transportation changes hold the potential to greatly increase the Ports of Virginia's business."

The report noted that Norfolk Southern's Heartland Corridor double-stack rail line to Columbus, Ohio, and Chicago opens in September; larger containerships that will take advantage of the Panama Canal's expansion slated for 2014 are starting to arrive in Hampton Roads; and that integrating the Portsmouth terminal into the VPA network will provide more immediate access to the east's two major freight railroads, Norfolk Southern and CSX.

It added that the announcement comes as the state considers industry offers to buy or privately manage the port.

Source: www.schednet.com