The best-laid plans to build a new container port in North Carolina are foundering on the shoals of environmental and community opposition. The North Carolina State Ports Authority, which for five years has been developing plans for a 1.5 million-TEU container terminal on 600 acres it acquired near the mouth of the Cape Fear River, is postponing the project “indefinitely.”
The apparent demise of the $2 billion-plus North Carolina International Terminal project could signal problems for other port expansion projects on the East Coast, which has not experienced the kind of environmental opposition delaying or canceling many projects on the West Coast, especially in Southern California.
“We’re taking a step back to regroup and reassess the business case in view of the economy,” said Tom Eagar, CEO of the port authority, who announced the hiatus in development on July 23. The port authority will not request the letter of intent that it had originally hoped to sign with the U.S. Army Corps of Engineers this year, but it will continue to work with the corps on its reconnaissance study for the deepening of the navigation channel to the NCIT.
Eagar said that study found sufficient federal interest in proceeding with the project through a more detailed feasibility study, but North Carolina’s General Assembly voted to cut the $10 million cost of the study out of the current state budget in the face of declining revenue.
“When we were walking the halls of the state assembly, it became very apparent that their minds were on many other issues, and not on port-related issues,” Eager said.
Another factor in the port authority’s decision was opposition from U.S. Rep. Mike McIntyre, a Democrat who represents Brunswick County, where the terminal was planned.
Eagar remains strongly committed to expanding the state’s port facilities so they can handle the deeper-draft vessels and growth of container volume expected to come through the Panama Canal after it completes its third set of locks in late 2014. “There is a significant market in North Carolina that requires deep-water port access — primarily the trans-Pacific services,” he said.
The port authority now plans to look at options for a deep-water terminal elsewhere, including the existing ports in Wilmington and Morehead City, the existing Brunswick County site and other, unidentified sites. “We’re going to look at all available properties,” Eager said.
Study of the port expansion project now is in the hands of Lt. Gov. Walter Dalton, who heads Gov. Bev Perdue’s Logistics Task Force, which will give it a statewide overview rather than the regional perspective .
“But the bigger story is that port expansion projects, as a general rule, experience pushback from the local community and the environmental movement,” Eagar said. He said opponents are quick to point out the environmental impact while discounting the need for the economic benefits that ports generate for the region, the state and the country as a whole.
Eagar plans to mount a solid business case for a deep-water port based on a reassessment of the timeline for when additional port capacity will be needed following the 2008-09 recession-driven downturn in volumes and in light of other expansion projects at South Atlantic ports. Those ports, he said, now are unlikely to become “strained” until 2022, two years later than pre-recession projections.
Another expansion project, the container port in Jasper County, S.C., has also been put on hold, although planning and some preliminary work is continuing. The schedule for construction of the project, managed jointly by the South Carolina State Ports Authority and the Georgia Ports Authority, depends on the return of demand sufficient to justify the required funding.
For now and the foreseeable future, the Port of Wilmington will have sufficient capacity to handle rebounding container volumes. The port authority expects to continue the port’s expansion program to increase its capacity to 600,000 TEUs, which would require additional dredging in the channel and the turning basin and fixing the “S” turn at Battery Island. Wilmington handled 194,608 TEUs in its most recent fiscal year, almost double its total 10 years earlier.
Further expansion of the Wilmington terminal also would require additional yard-handling equipment and the reconfiguration of its gate. “Accomplishing that will enable us to handle the 6,500-TEU vessels,” Eager said. “We have the cranes, and we have the land and access to the market, so we are in pretty good shape.”
Contact Peter T. Leach at email@example.com.