Pitfalls in Port Planning

4
6 PITFALLS TO MASTER PLANNING IN ASIA www.portsandmarinestructures.com

description

Pitfalls in Port Planning

Transcript of Pitfalls in Port Planning

Page 1: Pitfalls in Port Planning

6 PITFALLSTO MASTER PLANNING IN ASIA

www.portsandmarinestructures.com

Page 2: Pitfalls in Port Planning

In early 2009, the Manatee County Port Authority approved Port Manatee’s $750 million master plan. The master plan directed continued expansion efforts at Port Manatee for five decades, with an immediate focus on opportunities associated with the expansion of the Panama Canal scheduled for completion in 2014.

A primary focus of the plan included attracting containerized shipping to the port and related support industries. Other highlights of the plan included berth and container terminal expansions, comprehensive environmental mitigation strategies and road and railroad enhancements. This is a fine example of master planning.

Commercially trading ports benefit from having a comprehensive master plan, key outcomes include improved productivity, increased investment confidence, and greater environmental protection.

A port’s master plan should present broad strategic intentions over the medium to long term. A well chalked out master plan articulates the port’s future and points out key focus areas to all the stake holders.

Poor Master planning, lack of vision and inability to foresee future trend are perhaps the biggest reasons why many ports, once thought to be promising, fail. Ports have to pay a heavy price for the lack of planning; some of the consequences are:

• Loss of investor confidence• Increase financial and regulatory risks• Incompatible use of adjoining lands • Environmental risks, if effects of expansion are not considered in the beginning• Challenges in interface planning• Local and regional policy misalignment with regards to land use planning, transport, environmental, etc.• Lack of support local planning authorities and transport infrastructure developers

This article highlights some of the major pitfalls in port master planning and how to avoid them.

LACK OF SOUND TECHNO-COMMERCIAL FEASIBILITYFeasibility studies help evaluates technical, economic and commercial aspects of a proposed new port project. It evaluates alternatives on the choices of technology, equipment, location, capacity, financing methods and the assumptions on which the decisions have to be based.

Failure in carrying out an adequate and satisfactory feasibility study is a huge risk to the success of the entire project. Without feasibility study, it is impossible to know the right focus areas for the port, future action plans, economic viability, forecasted timelines, and measures of success.

INEFFICIENT INTEGRATION OF MARINE STRUCTURES AND OPERATIONSDisintegrated marine structures and operations will harm port’s future competitiveness, leading to deteriorating handling capacity and increased turnaround time. It will result in clear mismatch between logistics and terminal infrastructure.

An ideal and efficient integration of new marine structures such as berths, jetties and breakwater improves efficiency. It provides an opportunity to even smaller ports to handle increasing volumes more efficiently, increasing prospects of growth and profitability and will attract larger infrastructure investments.

Page 3: Pitfalls in Port Planning

POOR TRANSPORT INTEGRATIONA well integrated transport system at ports will have higher density of transport networks, ensure accessibility to key industrial and logistical centres in measured time, have lower transport costs, capacity for the main corridors, wide range of options available for carriers and ease of delivery in hinterland.

Inadequate capacity causes congestion and in turn impairs reliability. It creates an imbalance between incoming and outgoing volumes, hampering revenue stream to the parties involved. This inter-relationship among capacity, congestion and reliability is fundamental to the planning of hinterland transport networks.

Port Ennore, officially renamed Kamarajar Port Limited, is an excellent example of integrated operations. It is one of the biggest ports in India, and has a huge network of dedicated roadways and railways. Ennore Port Limited (EPL) is also developing an 8-lane Northern Express Road, which would link the port with the National Highway. It has a 560-metre long coal wharf for berthing two Panamax-size vessels and fully mechanised systems for handling 16 million tons of cargo a year. Designed as a world-class port, with two breakwaters—one in the north measuring 3,080 m and the other in the south measuring 1,070 m with a depth of 15 m, it has the capacity to develop 22 berths for handling a variety of bulk, liquid, and container cargo. A 26 km Y-shaped single-track northern link from the port to the Anuppampattu railway station, connecting the port with the Chennai-Gudur mainline will have two arms at the port end, with one arm culminating at coal and iron ore stack yards and the other culminating at the upcoming container terminals.

ABSENCE OF BACKWARD AND FORWARD CONNECTIVITYLet’s take an example. A container is shipped from the departure point A to a destination B via a given port and multiple companies handle this container throughout this specific journey. Starting from the inland terminal and moving towards the freight forwarder, shipping line, the terminal operator, and so forth, a number of parties are involved and serial interdependencies are developed. This means that the efficiency and effectiveness of the container’s movement is subjected to the coordination and collaboration of various parties. Due to the presence of such interdependencies, port service providers are embedded in port value chains aiming to generate value for their users.

Lack of hinterland and forward transport connection results in imbalances between in-bound and out-bound volumes handled, impacting revenues and future capacity generation planning, inconveniencing the end user. Understanding the emerging complex and diverse interactions, relations, and interdependencies between port service providers and the end users is of particular importance. The key is to find the missing link and develop strong relationships within the value chain.

Inte

ract

ion Figure 2. Interdependence and co-

creating value(Source: Forsstrom, 2005)

Tolerance for interdependence

Page 4: Pitfalls in Port Planning

POOR MAINTENANCE OF PORTSPort and harbour facilities generally face severe weather conditions, and tend to suffer from performance degradation over their service period due to several reasons like material deterioration, damage of components, settlement of foundations, sedimentation and other natural factors.

Health of ports can be assessed by:• Identifying urgent repairs and reinforcement of materials and developing a plan to execute them• Having a maintenance checklist• Determining components necessary to be observed over a time• Determining necessary restrictions and suspension of the facility use• Having a timely inspection plan• Identifying facilities that need renewal or demolition

A good example of this is Maldives Ports Limited’s (MPL). A World Bank technical report stated that, on average, equipment maintenance costs range from 15–25 percent of the total operating costs in a port. According to Maldives Ports Limited’s (MPL) Annual Report for 2011, equipment maintenance costs accounted for 25.6 per cent of operating costs, putting it outside the upper range of the average calculated by the World Bank. MPL’s financial report for 2011 showed the cost of spare parts to be $1.1 million. Considering the findings of the study, the author believes it is possible to reduce maintenance to 15 per cent of total operating costs by having a structured maintenance schedule, stock of crucial parts at all times, equipment rotation and proper training of maintenance staff.

It should be kept in mind that maintenance cost of port and its facilities is a part of its life cycle cost and should be budgeted for right at the outset.

OVERLOOKING IMPACT OF PORT DEVELOPMENT ON ENVIRONMENTThe potential adverse environmental effects of port development include land and water pollution, contamination of bottom sediments, loss of bottom habitat, damage to marine ecology and fisheries, loss of flora and fauna, beach erosion or accretion, waste disposal, oil leakage and spillage, air and noise pollution, vibration and flood light effect, etc.

For e.g. water pollution: Utilities like water supply, sewage treatment/disposal, waste management/disposal, electrical power supply should be augmented or developed as the case may be as a part of the port project. It is indispensible to have regulations on discharges of effluents into water and provision of sanitary treatment facilities for reducing pollutants from hinterlands.

A good example is the Port of Sohar. Before the start of the works, a thorough Environmental Impact Assessment (EIA) had taken place in order to receive the Environmental licenses. Not only the effects on the marine environment were investigated but also the long term impact on the coastline along the project area were considered. The Ministry of Environment and Climate Affairs (MECA) also has a unit located in Sohar to monitor projects and companies to make sure that the project is up to international standards.

A good master plan may well be the stepping stone to a port’s success. Learn more about effective port master planning and best industry practices, liaise with thought leaders, meet industry peers and network at Ports and Marine Structures Asia 2014, Kuala Lumpur.

http://www.internationaltransportforum.org/jtrc/DiscussionPapers/DP201319.pdfhttp://www.engineeringcivil.com/structure-of-feasibility-studies-to-develop-a-port.htmlhttp://www.elaw.org/system/files/Final+draft+Ports+%2526+Harbours.pdfhttp://www.porteconomics.eu/component/docman/doc_download/435-2012-creating-value-in-seaports.html

http://en.wikipedia.org/wiki/Ennore_Porthttp://www.bulkjettysohar.com/projecthttp://unctad.org/en/PublicationsLibrary/dtlktcd2013d1_en.pdf

Sources:

PORTS & MARINESTRUCTURES

ASIA 2014

ì Main Conference: 28 – 29 May 2014ì Pre-Conference Focus Day: 27 May 2014ì Post-Conference Workshops: 30 May 2014ì Venue: Prince Hotel, Kuala Lumpur, Malaysia

Meeting future trade growth through efficient planning, development and capacity addition to port and marine infrastructure

Tel: (65) 6722 9388 Fax: (65) 6720 3804 Email: [email protected] Web: www.portsandmarinestructures.com