Quequén Port adapting to expanded Panama Canal, expected higher exports

Monday, May 5, 2014

Harbour to deepen access channel to 50 feet from about 45, remove sunken hulls to widen it, building a new terminal to streamline loading of grains

The Atlantic Port of Quequén, one of Argentina’s leading grain export sites, is going ahead with a series of works to adapt itself to the current expansion of the Panama Canal and an expected major increase in Argentine exports in the medium term.

The port is planning to deepen its access channel to 50 feet from about 45 at present, shorten the northern breakwater and removing sunken hulls to widen it, and deepen the turning area — works for which it has created a trust fed by private funds currently standing at 45 million pesos.

It is also building a third terminal to streamline grain loading which is expected to be operative in about a year, and developing sites 11 and 12 to possibly build solid and liquid fertilizers storage and distribution facilities.

All these works come on top, among others, of the 2004/2005 US$50-million extension of the south breakwater — fully paid by the national state — which has allowed the port to reduce the ship arrival restrictions from 170 days to less than 70 days at present, Martín Caraffo, the Chairman of the Port of Quequén Management Authority said.

“This work that markedly improved the operations for the arrival and the departure of vessels had a very quick repayment ratio,” he said, addressing the First Hemispheric Convention on Dredging and Signalling sponsored by the Organization of American States and held last month at the private Catholic University in Buenos Aires.

The extension of the southern breakwater together with the work of the Coast Guard allowed the port to stay open with a length of wave shorter than the one prevailing at the time, he added.

“Obviously, the aim of these works is to adapt ourselves to the expansion of the Panama Canal which, despite the difficulties it is undergoing, we have no doubt will be finally be completed,” Caraffo said.

“Also, we foresee that Argentine exports will at least double in the medium term.

“We are a port located in a grain area par excellence. Our leading clients are the South-East Asian countries who continue to demand grain for human consumption and are looking at us with increasing attention. And although their ports don’t yet have a depth of 50 feet, we think we all must get used to this kind of port improvements,” he added.

“Being a natural, deep-water port, the arrival and departure to and from Quequén demands no more than 20 minutes for ships, which means major advantages from the point of view of costs,” Caraffo said.

The Quequén port authority chairman also said that vessels at Quequén are loaded directly from its terminals which also complete shiploads to vessels coming from the Paraná-Paraguay waterway that must complete their cargoes at Quequén due to the waterway’s draft problems.

LOCATION AND CONNECTIONS

The Port of Quequén is located on the River Quequén, 488 kilometres south of the City of Buenos Aires, and is connected to all production centres via a network including national roads 227 and 228, and Buenos Aires provincial roads 36 and 88, as well as a link with the Ferrosur Roca cargo train line.

It is in front of the Atlantic resort of Necochea which lies just across the River Quequén. It is located only 98 kilometres from Balcarce, 120 kilometres from Tandil, 145 kilometres from Tres Arroyos, 180 kilometres from the port of Mar del Plata and 345 kilometres from the port of Bahía Blanca in the heart of the farming area of south-eastern Buenos Aires province, rich in wheat, barley and soy.

Additionally, he said, that the Port of Quequén was tendering works to improve the accesses to the port by revamping the Almirante Brown Avenue and the Ring (Circunvalación) Avenue.

“Some minor problems we had in connection to these accesses will be overcome in a short time because we are already in the stage of awarding the contracts,” Caraffo said.

PORT AUTHORITY

According to port experts and  officials, Bahía Blanca and Quequén, run by public, non-state agencies, are examples of some of the best port management in the country.

The new legal status adopted in 1992 was applied to Bahía Blanca and Quequén and it has borne a lot of fruit.

The port authority is formed by nine members, with eight directors representing the production, trade union, service suppliers, and a chairman, who is appointed by the Governor of the province.

“It has been a very good experience because all parties engage in constant debate,” Caraffo said.

Bahía Blanca and Quequén were among the five national ports (the others being Buenos Aires, Rosario, and Santa Fe) which Law 24,093 — passed in 1992 during the first presidency of neo-conservative Peronist Carlos Menem — ordered be transferred to their respective provinces on condition that they be managed by private or public-private agencies.

Shortly afterwards, Menem vetoed the transfer of the port to Buenos Aires to the City of Buenos Aires because at that time the city was not yet autonomous.

DREDGING

In a first stage, between 2004 and 2007, Quequén brought in the Perekopskiy dredge from Ukraine, when Ukraine was segregating from Russia, and the port authority assumed the management of the dredge together with a company with very good results both in Quequén and other ports in the province, Caraffo said.

The contract was terminated due to strictly administrative reasons connected to the exploitation of the dredge and against the will of the port authority, he added.

In 2007 three dredging campaigns were contracted “because to maintain the current depth of about 45 feet demands dredging some 600,000 cubic metres a year,”  he said.

Caraffo added that between 2007 and 2010 the UTE (transitional joint venture) formed by the Jan De Nul and Boskalis groups was hired “with very good results regarding depth.

“Since 2010 we have been hiring emergency campaigns and currently we are engaged in a macro-project to tender the deepening of the access channel to 50 feet, the shortening of the northern breakwater and the removal of sunken hulls from the north breakwater to widen the channel’s width, very important works which we think will strongly contribute to improving costs which, in turn, we believe, will lead to price improvements in the grain exported via Quequén, benefitting primary producers, who will be those directly receiving a better price for their exports.”

Quequén has an access channel of 120 metres in width and about 45 feet depth and has natural depths only 1,500 metres from the river mouth, which allows the navigation of vessels of more than 41 feet draft with the expectation that in a not too distant future they will be able to leave the port terminals with a draft of 45 feet.

Caraffo said that the “very ambitious project” will be carried out in stages, with the removal of the hulls sunk at the northern breakwater as it is those which first harm the channel as they reduce its width.

“Cleaning up the northern breakwater will allow us to widen the channel and avoid a manoeuvre which pilots must make when the ships arrive and which is dangerous for navigation,” the chairman of the Port of Quequén Management Authority said.

“For this work we created on December 1, 2012, a trust for which a dollar plus IVA value-added tax is charged on each tonne going out and coming in, funds which must be directly deposited by exporters and importers in special, separate accounts in the trust, which ensures transparency. The trustee is the Banco Nación.”

The trust has been a figure widely used in Argentina some years ago for a range of works, such as building construction but this is the first time that it has been applied to dredging work, Caraffo said, adding that currently the trust stands at 45 million pesos.

He said that four companies — Jan De Nul NV, Van Oord Dredging and Marine, Boskalis International BV, and Dredging International BV — have been pre-classified. The Port expects to hand them the documented conditions by June or July and award the works in August.

“We think that this will be a very good tender despite some macro-economic difficulties which do not favour this kind of works,” Caraffo said.

Source: Buenos Aires Herald http://www.buenosairesherald.com/article/158605/quequén-port-adapting-to-expanded-panama-canal-expected-higher-exports