Virginia Port Authority expects to run Richmond harbour from July

THE Virginia Port Authority (VPA) will likely take over the Port of Richmond administration on July 1 following an agreement in principle to sign a five-year lease with renewal options.


Last July, the City of Richmond asked for private sector bidders to take over its underperforming port, but nothing of interest emerged. The VPA says it intends to "aggressively develop a container-on-barge service", linking the port to Hampton Roads.


Municipal port director David McNeel told American Shipper that Richmond City Council will vote on the deal within a fortnight while the VPA board will decide on May 24. Mr McNeel said his position would be eliminated and port staff would be assigned to other municipal departments if the deal goes through.


Last summer, the VPA offered a lease, promising to assume responsibility for all infrastructure upgrades, business development and operating costs with a view to developing an intermodal hub to reduce highway truck traffic.


The latest proposal includes three five-year options. The big difference in the new deal is that the VPA will pay the city US$75,000 a year instead of the dollar a year offered under the old scheme. The money is expected to go to debt servicing.


Current terminal operator Port Contractors Inc (PCI) will be kept on. The port lost more than $1 million combined in the past four years and was bailed out by the city in 2010 to cover operating expenses.


Two months ago, Iceland's Eimskip Shipping pulled out of Richmond and now calls at Norfolk. Eimskip had halved its Iceland/Canada service to once a month and International Container Line, a small transatlantic carrier stopped calling in 2009 in favour of Wilmington, North Carolina.
(Source:www.shippingazette.com)