Mega-port possibilities seen for Baja
http://www.signonsandiego.com/news/business/20041207-9999-1b...
Study includes rail link to Arizona
By Diane Lindquist and Sandra Dibble
December 7, 2004
Officials in Baja California, together with two major transportation firms, are exploring development of a commercial port south of Ensenada that
could handle mega-tankers and thus gain a bigger share of the Pacific Rim's expanding trade.
The idea is in the earliest stages, but officials in Baja California envision a major container facility that would one day absorb traffic from the
ports of Long Beach and Los Angeles.
"It would be a world-class commercial port that could take away some of the pressure that now exists," said Sergio Tagliaprieta Nassri, Baja
California's secretary for economic development. "Right now, ships are waiting five days, even more to unload in Long Beach."
As envisioned, the port would be connected to the United States by a rail line through Mexicali to Yuma, Ariz., which would allow cargo to be shipped
to the interior of Mexico and the United States.
Some say the project should include an airport, though it's unclear if the issue is being considered in the study.
"The idea is that you can move the cargo by land, sea and air," said Ernesto Ruffo Appel, the former governor of Baja California and ex-mayor of
Ensenada who is now working as a private consultant. "Up to now, what we have is a great necessity, and interest from investors," but there is no
formal proposal.
Hutchison Port Holdings, whose Ensenada International Terminal subsidiary operates commercial and cruise ship port facilities, and the Union Pacific
Railroad are jointly investigating the feasibility of such a project, said Tony Chacon, the railroad's assistant vice president of marketing and sales
for Mexico.
A representative for Ensenada International Terminal declined to comment, but state officials in Baja California say they have been helping Hutchison
conduct its study.
Hutchison, with 206 berths in 35 ports, is the world's leading port developer and operator, and Union Pacific is North America's largest rail
operator.
Mexico privatized the Ensenada port in 1997, selling a 35-year operating concession to International Container Terminal Service of the Philippines,
which later sold it to Hutchison.
"There's little opportunity for expansion (at the current port) the way the city has grown around it," Chacon said.
Dredging is under way to expand the capacity of the Ensenada port and allow bigger commercial ships to dock there. The proposed port would be able
accept the largest commercial vessels, including mega-tankers.
The port would serve not only as a commercial bridge to the United States but as a way to facilitate shipments to Baja California's maquiladora
industry and other businesses.
Antonio Rodr?guez Hern?ndez, a state legislator from Ensenada, said it could be instrumental in the development of a "high technology corridor"
linking California's Silicon Valley with Tecate and Ensenada.
Porfirio Vargas, a state infrastructure planner, said three sites are under consideration for the future mega-port, all south of Ensenada: Santo
Tomas, Punta China and Punta Colonet. The one most frequently mentioned is Punta Colonet, which is about 80 miles south of the existing port.
The study is expected to be completed in the second quarter of 2005, Chacon said. "It includes determining the cost of such a project."
Some estimates have put the price of a port and rail line at $1.2 billion and envision a port with a capacity of up to 1.5 million containers per
year.
Baja California is not the only Mexican state that wants a larger part of Pacific Rim traffic.
Farther south on Mexico's mainland ? and further along in planning ? is the state of Michoacan's plan to develop the port of Lazaro Card##as and link
it by rail to Laredo, Texas.
"The state wants it to be the hub on the Pacific for Mexico," said Carlos Heredia, international affairs adviser.
Lazaro Card##as opened a container terminal in September, also operated by Hutchison, and is making final arrangements for a rail link with Kansas
City Southern and Transportacion Ferroviaria Mexicana.
In Baja California, the project is years away, and once it is approved, it would take a decade to complete, said Sen. H?ctor Osuna Jaime, a federal
senator from Baja California and chairman of the senate's transportation and communications committee.
"Many people will be interested in it if it's a good idea," said Osuna Jaime. "Money is not a problem if the business is there."
If Baja California decides to proceed with the plan, he said the next step is to reach out to all those who might be interested in developing and
financing the project.
The Port of San Diego is aware of the plan for a new Baja port, said spokeswoman Irene McCormack, but it's not expected to affect commercial shipping
in San Diego because the harbor here can't accommodate the mega-ships with 50-foot drafts the Ensenada port would hope to attract.
An article in the Los Angeles Business Journal last August cited a confidential study by the Port of Los Angeles that expressed concern that Mexican
ports could take away business. But Teresa Adams, a spokeswoman for the port, said this week that there is no such study.
Ann Vanpraagh, a Moody's Investor Services port analyst in New York, said the concept for a new port south of the border makes sense.
"Over the long term we will need some reliever ports along the West Coast to handle the growth of cargo in North America that is expected in the next
decade or two," Vanpraagh said.
Traffic is projected to double at the Long Beach and Los Angeles ports during that time, she said.
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