Cover Story: Big plans
Maine’s only marine container terminal stands to get busier as the state expands its capacity as an intermodal hub
This fall, Shaw Brothers Construction is breaking ground on an $8.57 million construction project at the International Marine Terminal (IMT) in Portland, part of a multi-phase effort to expand port capacity and connect the terminal with the state’s freight rail network. The project is one more in a string of headlines about the port that have heralded the port’s dramatic turnaround from a particularly low point in its recent history.
John Henshaw, executive director of the Maine Port Authority, notes that much has changed since the height of the recession in 2009 when the port was stung by the shutdown of a barge service to New York that was, at the time, the port’s last regular waterborne freight connection, although for a brief time, there was a container service that connected Portland to the Port of Halifax. That service ended in May 2012 after a brief run, citing lack of steady demand.
Henshaw said, that since those low times, the port has been working to broaden its appeal by investing in infrastructure to streamline the handling of containers, to increase port capacity and to lower shipper costs in order to attract more traffic.
The first bright spot in that recovery was the announcement last year that Icelandic shipper Eimskip was moving its North American operations to Portland. Henshaw says plans for the port will leverage this opportunity, as well as other developments.
“This is not about a single deal; it is about the ability to support a diverse customer base.”
Henshaw notes that by attracting a broad customer base, the transportation mix will be diverse, as well. In addition to Eimskip, rail, over-the-road and a new “marine highway” route will serve domestic and international shippers and markets.
He said that, already, the terminal has handled a wide range of goods, including frozen fish, forest products, lobster, potatoes, automobiles, household goods and building materials, to name but a few.
“Eimskip has even carried a composite bridge to Norway from the terminal,” said Henshaw.
John Duncan, executive director of the Portland Area Comprehensive Transportation System (PACTS), calls the port the region’s “largest transportation asset” and calls the opportunities it offers local businesses: “a way to send their products to distant markets cost-effectively.”
He said that few people know just how diverse those market opportunities are, and that they are not only buyers for forest products and oil, products typically associated with the port. “When I visited the port in May, there were a dozen electric cars being shipped to Iceland from car dealers here,” said Duncan.
As recently as 2007, the Maine Port Authority was marketing the port of Portland as “the largest tonnage seaport in New England” and as the east coast’s second most active oil port.
The International Marine Terminal, located at the base of the Casco Bay Bridge, was only converted from a mixed-use passenger and freight terminal in 2010 and is now set to double in size and have a direct connection to a rail line. Previously, containers had to be trucked a short distance to the rail loading point at Merrill’s Marine Terminal on Cassidy Point. These developments will lead to critical improvements that will help keep the cost of shipping freight to and from the port competitive.
The expanded terminal will include about 18 acres on the west side of the bridge, plus a five-acre strip of land that will serve as a rail corridor. Improvements in highway infrastructure over the past decade have included construction of the new Veteran’s Memorial Bridge and the Fore River Parkway to facilitate over-the-road access to I-95.
The expansion is one of several projects funded by the $100 million transportation bond approved by voters in November 2013. This work comes on the heels of earlier investments in converting the International Marine Terminal from a mixed-use passenger and freight terminal to a dedicated container facility and dredging the harbor, the latter having been completed just this past winter.
The shoreside port expansion project has required negotiations among multiple parties, including Pan Am Railways, Unitil and Phineas Sprague Jr., a Portland businessman who has been planning to build a boat yard on about 22 acres he owns next to the Casco Bay Bridge.
Those negotiations have had their share of challenges. When MaineDOT took ownership of an 18-acre parcel of Sprague’s land on April 30 by eminent domain, the state gave Sprague $7.18 million, approximately three times what he paid for it two years earlier. Sprague, in August, said he intends to challenge the state’s purchase price because the land is worth considerably more, now that port shipping activity has increased.
Henshaw said that Sprague’s likely legal challenge will not hinder the project getting underway. “That will not impact construction,” said Henshaw.
A new kind of barge
Currently the terminal is used by Eimskip for its container business as well as by other international carriers as an intermodal hub. Eimskip is credited with being one of the port’s major players, leading the way after it moved its U.S. port of call for its own vessels to Portland from Norfolk, Virginia and Boston.
The company already moved 5,000 containers in its first full year and had signed 20 export/import business customers. The firm is poised to stay and has been putting down roots with support for local charities and other events. Larus Isfeld, managing director of Eimskip USA, has said he hopes container traffic will double going forward and has indicated that the new direct rail connection will be important to that goal.
Also part of the port’s big plans are development of a coastal shipping service that would be part of “America’s Marine Highway.” The Maine Port Authority is developing an innovative vessel to carry an array of goods between Portland and the Port of New York/New Jersey.
The project was one of only eight marine highway projects to receive project designation in the Marine Highway Program by USDOT in 2010. A 2012 grant of $150,000 has served as seed money and enabled the Port Authority to do preliminary design of the vessel and service. That work has been completed, and the Maine Port Authority will be delivering it to the U.S. Maritime Administration within the month. More funding will be needed to actually build and put a barge into service, according to Henshaw, who said the new vessel is a sensible investment.
“We believe a barge [designed specifically for the Portland-New York/New Jersey route] is a piece of public infrastructure much like a highway or a bridge would be,” said Henshaw, adding that public support of the route would stop short of operational subsidies. To that end, the Port Authority is planning to market the service as a public-private partnership and has engaged McAllister Towing & Transportation, the largest marine transportation firm in the U.S. (the firm that owns Portland Tugboat LLC) as an operating partner for the service. The current timeline for launch of the service is “realistically in 2017 or 2018,” according to Henshaw.
Nevertheless, Henshaw said, the short-sea service has generated “quite a lot of interest” from manufacturers and others, including Eimskip which sees it as a way to further expand the company’s reach in the American market. “I am confident in the model,” said Henshaw.
Henshaw sees potential in Maine’s other deepwater ports as well, and he expects that continued strategic investments will yield new opportunities. The Port of Eastport recently completed a new bulk handling system and other recent improvements.
That port, championed by an energetic and creative Eastport Port Authority, is diversifying its customer base.
Hopes are the U.S. Army Corps of Engineers will soon approve the project to dredge the channel at Searsport, that hasn’t been maintenance dredged since the mid-1960s. That would improve safety and open the port to new markets served by deeper draft vessels that are becoming the standard in the marine freight industry. The recent purchase of the Montreal Maine & Atlantic rail line, which serves the port, by an investment group that has renamed it the Central Maine & Quebec Railway and invested $10 million in new equipment, also bodes well for the future of Searsport. “These are huge positive developments that increase the potential of the port of Searsport and its role in the state’s economy,” said Henshaw.
“We have to continue to be strategic, and it certainly requires that everyone pitch in,” said Henshaw. “But if you think about where we were a few years ago and what happened in the economy, it’s remarkable.”