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Port of Brownsville Posts Record Cargo and Total Operating Revenue in 2018

Ongoing Success and Positive Outlook Underscore Port’s Pivotal Role in North American Trade

BROWNSVILLE, Texas – March 19, 2019 – The Port of Brownsville set new records in tonnage and total operating revenue in 2018, moving 11.3 million tons of diverse cargos with operating revenues of more than $24.2 million. The results, announced today at the annual State of the Port Address, reveal a 6.6 percent increase in cargos, a 25 percent increase in rail movements, and a 2.5 percent increase in operating revenues from the previous year.

“Congratulations to our partners, customers, and port users who all contributed to these new high-water marks,” said John Reed, Chairman of the Brownsville Navigation District. “Steel was up, almost all petroleum categories were up, dry bulk cement and sugar were way up.”

The port’s Foreign Trade Zone No. 62 ranked second in the nation with exported goods valued at $3.6 billion, setting another record. Due to its unique location and proximity to key markets, the port remains a critical gateway for steel products entering Mexico’s industrial centers from across the globe.

The port continues to invest in major infrastructure improvements. A new $28 million Liquid Cargo Dock 6 will be completed and in-service by the end of the second quarter of this year, greatly expanding the ability to move energy products quickly, safely and efficiently. The Bulk Cargo Dock at the port’s grain elevator is under renovation and expected to be finished and operational by June, allowing the export of grain products for the first time in nearly a decade. And a $350 million channel-deepening project is expected to receive key permits by year’s end. This project will deepen the channel from 42 feet to 52 feet, making it one of the deepest U.S. ports on the Gulf of Mexico.

This work continues to attract potential operations that would bring significant economic and job opportunities to the region. In recent weeks, Rio Grande LNG finalized a 50-year lease for an almost 1,000-acre site at the port as the company continues to seek approvals for its $15 billion investment in Cameron County. Big River Steel recently extended its option for an expected investment of $1.6 billion for its proposed steel mill. And Keppel AmFELS announced an expansion to its port operations, introducing deep-draft ship building to Texas for the first time.

The news was announced to a group of about 250 guests attending the Port of Brownsville annual State of the Port Address. Leadership announced record breaking numbers in total revenue and tonnage, as well as plans for future projects and operations.

About the Port of Brownsville

The Port of Brownsville is the only deep-water seaport directly on the U.S.-Mexico border, and the largest land-owning public port authority in the nation with 40,000 acres of land. It transships more steel into Mexico than any other U.S. port. With more than $40 billion worth of projects currently in the works, the Port of Brownsville is transforming the Rio Grande Valley by creating positive investment opportunities and jobs. Activity at the port is responsible for adding more than $2 billion to the regional economy, $3 billion to the Texas economy, and for the creation of more than 44,000 jobs statewide.

Army Corps of Engineers finishes dismantling of historic STURGIS vessel

BROWNSVILLE, Texas – The U.S. Army Corps of Engineers celebrated Friday, March 15, the completion of the decommissioning and dismantling of the historic STURGIS vessel that was formerly the world’s first floating nuclear power plant. This was marked by the final section of the former vessel being segmented and brought ashore for processing and recycling at the International Shipbreaking facility in the Port of Brownsville.

“We’re extremely proud of the work the team has done on the STURGIS decommissioning and dismantling,” said U.S. Army Corps of Engineers Project Manager Brenda Barber. “I also want to take this opportunity to thank the local Galveston and Brownsville communities and our local partners and stakeholders for their support as we implemented this complex project in both communities. The local support our team has received greatly contributed to the success of this project.”

The Army converted the STURGIS from a World War II Liberty Ship to a mobile nuclear plant in the1960s. It was deactivated and partially decommissioned in 1976 and subsequently safely stored in the James River Reserve Fleet at Joint Base Langley Eustis, Virginia until being towed to Galveston, Texas in 2015 for its final decommissioning and dismantling. From 2015 to 2018, the U.S. Army Corps of Engineers and it prime contractor, APTIM Federal Services, implemented the challenging and complex efforts to decommission the MH-1A – the deactivated nuclear reactor that was onboard the STURGIS vessel.

In Galveston, the vessel underwent radiological decommissioning that included the safe removal of all components of the deactivated nuclear reactor and all associated radioactive waste that was formerly onboard the STURGIS.

As part of the radiological decommissioning in Galveston, the U.S. Army Corps of Engineers safely removed and shipped more than 1.5 million pounds of radioactive waste and recycled more than 600,000 pounds of lead. Throughout the project, continuous environmental monitoring was performed and the results confirmed there was no evidence of radioactive material, lead or increased radiation exposure from the STURGIS project during its time in the Port of Galveston.

With the successful removal of all radioactive waste from the STURGIS and extensive radiological surveys that confirmed all radioactive waste had been removed, the STURGIS was cleared to be towed to Brownsville for traditional shipbreaking and departed Galveston in September 2018.

Since all of the radiological contamination was previously removed from the STURGIS, the International Shipbreaking facility in the Port of Brownsville was able recycle the entire vessel. Based on the current information, U.S. Army Corps of Engineers officials estimate approximately 5,800 tons of steel and other assorted metals from the ship will have been recycled.

Now that all of the physical field work has been completed, the team will focus on the Project Closure Report and subsequent Decommissioning Permit termination.  Additionally, the team will be completing the necessary Historical Mitigation to document the history of the STURGIS.

STURGIS History/Background

The STURGIS has had a unique life since first being built in the 1940’s as a World War II Liberty Ship, the SS Charles H. Cugle. After serving in World War II, the ship was converted into the world’s first floating nuclear plant in the 1960’s, housing the MH-1A nuclear reactor. Before being shut down in 1976, the STURGIS’ nuclear reactor was used to generate electricity for military and civilian use in the Panama Canal. The reactor was de-fueled, decontaminated for long-term storage, and sealed before being towed to the James River Reserve Fleet at Joint Base Langley Eustis, Virginia; where it was stored and maintained since 1978, except for times of periodic dry dock maintenance. In 2012, its formal decommissioning effort began as part of a broader effort to decommission the Army’s retired nuclear reactors through the Army Deactivated Nuclear Power Plant Program. After award of the decommissioning project contract, the STURGIS was ultimately towed 1,750 miles from Virginia to Galveston, Texas in April 2015 for its final decommissioning.

That decommissioning effort was completed summer 2018 summer with the safe removal of all components of the deactivated nuclear reactor and associated radioactive waste that was formerly aboard the STURGIS. The vessel was towed to Brownsville, Texas in September 2018 for final traditional shipbreaking, which was completed in March 2019.

Historical Imagery and B-Roll Footage Available: https://drive.google.com/open?id=1vrQ_eN9lV5-hVvfpdhHFV5yJjklev9pn

 

 

The final piece of the STURGIS is lifted from the Brownsville Ship Channel at the International Shipbreaking, Ltd yard at the Port of Brownsville. U.S. Army Corps of Engineers officials estimate approximately 5,800 tons of steel and other assorted metals from the ship will have been recycled (Photo courtesy USACE).

 

 

GFOA Recognizes Port of Brownsville for Excellence in Financial Reporting

BROWNSVILLE, Texas — For the seventh consecutive year, the Brownsville Navigation District has received the highest form of recognition for governmental accounting and financial reporting for its 2018 comprehensive annual financial report (CAFR).

“This recognition confirms the strong, transparent financial management brought forth by the Brownsville Navigation District commissioners and staff,” said John Reed, BND chairman. “I commend and thank the BND financial team, as well as the board of commissioners, for their hard work and diligence in our commitment to the district’s taxpayers.”

The Government Finance Officers Association of the United States and Canada (GFOA) presented the award to Lorena Hernandez, Port of Brownsville director of finance.

“It makes me very proud to represent a team that adheres to the highest principles of government accounting, as seen by this annual accomplishment.” said Hernandez.

The GFOA established the Certificate of Achievement for Excellence in Financial Reporting Program (CAFR Program) in 1945 to encourage and assist state and local governments to go beyond the minimum requirements of generally accepted accounting principles to prepare comprehensive annual financial reports that evidence the spirit of transparency and full disclosure and then to recognize individual governments that succeed in achieving that goal.

 

Brownsville Navigation District commissioners and staff pose for a photo with the latest CAFR award. From left to right: Sergio Tito Lopez, BND Vice Chairman; John Reed, BND Chairman; Lorena Hernandez, Port of Brownsville Director of Finance; John Wood, BND Commissioner; and Esteban Guerra, BND Commissioner.

Port of Brownsville Update on KURV’s Radio Show

BROWNSVILLE, Texas — Port of Brownsville Director and CEO Eduardo A. Campirano was a guest on KURV’s radio show “The Valley’s Morning News” Thursday, Feb. 7.

Campirano spoke with show hosts Sergio Sanchez and Tim Sullivan about the port’s nationally ranked Foreign Trade Zone No. 62, the steel industry, ship building at Keppel AmFELS, and other updates at the port.

Listen to the interview: https://soundcloud.com/kurv-710/port-of-brownsville-director-ed-campirano

 

US shipments of wind power equipment soar

BY CHRIS BARNETT / Journal of Commerce

Article published Wednesday, January 30, 2019, in www.joc.com

 

Under the influence of a “super cycle” driven by tax credits, approximately 38,000 megawatts of wind farm development were under construction or in advanced development in the US by the third quarter of 2018, up 28 percent from the same period in 2017. Overall, total installed wind capacity had reached 90,550 megawatts in November, according to the American Wind Energy Association (AWEA). When those projects are completed, installed capacity will have increased another 42 percent. And, thanks to the increasing viability of wind-based energy production and the vagaries of tax law, the building boom should continue through at least 2023.

For wind-related project cargo logistics, that equates to a lot of business, as well as a high risk of congestion and equipment shortages.

Anthony Long, general manager for global supply chain sourcing at GE Renewable Energy, says the wind power industry is going through a “super cycle” similar to 2012, when the Internal Revenue Service introduced the Production Tax Credit (PTC) to promote development of renewable energy. “There is a rush to cash in, and [it’s] an opportune time for developers; but we also think the long-term market for wind energy and wind turbines is strong,” he said.

GE is a trailblazer that has grown with the industry, said Long, citing the company’s recently created two-piece blade for its Cypress onshore turbines, an innovation in design and logistics. On the latter, the blades drive down logistics costs by enabling assembly on site, reducing the need for permitting equipment and roadwork, according to a GE brief. “The high-tech carbon blades create a new flexibility of transport,” Long said.

John Lusty, director of energy and utility solutions for Siemens Gamesa Canada, said the adoption of renewable energy has been “far greater than we anticipated and that’s not slowing down, especially in light of recent reports from the United Nations and research organizations that confirm climate change is real and the effects of carbon dioxide-free emissions is exponentially beneficial. We’re moving massive pieces of equipment in a heightened level of activity to execute installations of [qualified] wind farms before that PTC window closes.” Although the incentive doesn’t end until 2023, projects must be producing energy by then to receive the tax credit.

Arturus Espaillat, senior manager of transportation for manufacturer Vestas, agrees. “The phase-down of the PTC is certainly driving a surge in installations as project developers and owners work to meet the PTC qualification deadlines in a very active overall economy,” he said in an email interview with The Journal of Commerce. He cites a forecast from energy consultant Wood Mackenzie Power & Renewables that installations will top out at 11 gigawatts annually in 2019 and 12 gigawatts in 2020, then scale down “to more sustainable levels.”

Larger turbines

This logistics activity level is not new, Espaillat said. The industry experienced high-volume installations in 2012. “The difference this time around is on turbine size. Blades have gone from 150 feet in average length to over 200 feet,” he said. Greater lengths and weights add new “execution challenges” such as police escorts and night travel that “stretch the available capacity of the transportation industry.”

But, he added, heavy-haul transport companies that left wind a few years ago to serve other booming industries are coming back.

Moving a disassembled 300-foot-tall wind turbine overland is a quintessential project cargo challenge — and a single turbine makes only a dent in the ever-growing demand for energy production. But to attain critical mass and electrify a geographical grid, it takes a farm of wind turbines, not a solo shipment. For the first time, land-based towers capable of generating 4 megawatts and powering 1,400 homes a year were installed in the third quarter of 2018, according to the AWEA.

St. Cloud, Minnesota-based Anderson Trucking Services (ATS) has developed a prowess for moving these project cargoes. “We saw the birth of the wind industry in the early 2000s, made the strategic investments in equipment like the Schnable multi-axle trailer where we can grab each end of the turbine’s tower section and, through the magic of physics, keep it ‘floating’ while it’s being transported,” explained Gene Lemke, ATS’s vice president of projects.

ATS has transported more than 200,000 wind components since 2003. “Right now, with the [PTC] expiring, [turbine] manufacturers are racing to get their bids out to market so they can beat their competitors in locking up transportation capacity,” Lemke said. “We already have projects booked through the fall of 2019, and we are now having to walk away from some business due to lack of capacity.”

ATS has a fleet of 110 wind blade trailers (when loaded with a 228-foot blade, one trailer is as long as 14 mid-sized sedans), 90 Schnabel trailers for hauling turbine tower sections, and other trailers capable of transporting wind components such as nacelles and hubs.

As blades lengthen, ATS is investing in the next generation of blade trailers and collaborating with a trailer manufacturer to design a customized blade trailer. ATS, however, monitors the wind market closely, and “we’re staying somewhat conservative,” Lemke said. His company expects the market to slow after 2021 and then pick up around 2025, “when the new higher-output turbines help to render the expired federal tax credit irrelevant and the economics of projects become more favorable.”

Demand surge boosts prices

Meanwhile, the surge in demand is pushing up pricing, Lemke said, stopping short of discussing specific rates or percentages. “It is the simple demand-supply equation, and right now there is a lot of competition for assets,” he said.

Lone Star Transportation, a Fort Worth, Texas-based heavy hauler running 400 trucks including owner-operators, also specializes in moving wind tower components and has “several major projects” booked through 2019. Demand for capacity is strong, equipment manager Joe Byrd said.

Keeping pace with the ever-expanding physical dimensions of an onshore wind turbine, which can be as tall as 300 feet — almost the full height of the Statue of Liberty — when installed, is a continuing challenge for heavy haulers. In 2001, a nacelle (the power generating unit of the turbine), was rated at 0.6 megawatts, weighed 40,000 pounds, and moved on a normal, over-the-road double-drop trailer, Byrd said. Today, a 2.5- to 3-megawatt nacelle can weigh 168,000 pounds and moves on a four-unit, 13-axle rig that could extend more than 100 feet on the road and requires escorts, he said.

BNSF Railway is advising wind farm developers to move components well in advance of installation deadlines. “We also encourage our customers to have a laydown yard that can be used for staging components on the ground for last-mile truck deliveries,” said Theresa Lorinser, the railroad’s marketing director for industrial products.

She said the industry has invested in new multipurpose railcars, so the surge in development and transportation isn’t impacting the availability of equipment. “As blade lengths grow, it does not necessarily change the way railcars function,” she said. “The concentration will still be centered around how the blade moves on a railcar. We have shipped blades that have extended over three 89-foot railcars.”

G2 Ocean, a joint venture formed by Gearbulk and Grieg Star in 2017, operates a fleet of open-hatch vessels and conventional bulkers, transporting forestry products, steel, and project cargoes including wind. Long blades fit nicely on G2 Ocean vessel decks, according to one shipper.

G2, which handles wind blades, towers, and nacelles from Asia through the Texas ports of Brownsville, Corpus Christi, Galveston, and Houston, expects “a very big year in wind components,” chartering director Andy Powell said.

Several US ports, many in the Gulf, are expecting a surge in wind cargo during the next 24 months. Corpus Christi serves as the gateway to a “wind corridor” that runs from Texas through New Mexico, Colorado, Oklahoma, Kansas, and as far north as Nebraska, said Maggie Iglesias-Turner, the port’s business development manager for wind energy and project cargo. Although trucks primarily serve these regions, a decent proportion of blades leave the port by rail.

“Manufacturers in the next two to three years will be very, very busy,” Iglesias-Turner said. The phasing out of the PTC will push developers “to get their components to the jobsite as quickly as possible to take advantage of the PTC as we know it.”

Despite tariffs, she expects China, South Korea, Brazil, and Europe to be key sources of wind imports into the US. Wind components take up a lot of space, itself a valuable commodity that many US Gulf ports are able to offer developers. Corpus Christi has added 25 acres of laydown space, bringing the port’s total to 100 acres.

Wind components are also important at Brownsville, on the Texas-Mexico border and where imports are bound for US and Mexican wind farms, said Steve Tyndall, senior director of marketing and business development. The port generally handles three major wind energy projects a year, he said. “So far, we have two lined up for next year, and I’m confident we will have a third before this year is out,” he said in late 2018. “2019 should be a good year for us.”

Brownsville also hopes to become a wind blade exporter, thanks to TPI Composites, a global blade manufacturer based in Scottsdale, Arizona. TPI is building two blade manufacturing plants in Matamoros, Mexico, near Brownsville, that will begin operating this year, and produce 3,000 blades a year, according to Tyndall. “I don’t know if we’re going to get a large slug of that cargo, but we can certainly handle it,” he said.

Gulf ports don’t have a lock on wind power logistics. The Port of Duluth, Minnesota, handled its first wind turbine component shipment in 2005. More than 90 percent of the wind components imported into the port move out by truck — west to Montana, Wyoming, and Colorado; north to Alberta, Canada; and south to Missouri and Oklahoma.

“Our Duluth Cargo Connect team has seen [wind] freight tonnage go up and down with the [enactment of] the [PTC] but we’ve made port improvements to accommodate the increasing size and weight of these units,” said Adele Yorde, public relations director for the Duluth Seaway Port Authority. “We have the experience in handling wind components. We have 40 acres of outdoor storage and laydown. We spent $20 million on reinforcing our dock for heavy-lift cargo and adding more crane capacity,” she said. “We are ready.”

Port of Brownsville Announces New Director of Communications

BROWNSVILLE, Texas — The Port of Brownsville announces the promotion of Jorge I. Montero as new director of communications, effective Dec. 17, 2018.

Montero has more than 14 years of experience in journalism, marketing and communications, previously serving as communications specialist for the port. He now oversees the department responsible for implementing internal and external communications and media relations efforts for the Port of Brownsville.

Prior to joining the port, Montero worked for the Brownsville Economic Development Council as marketing and design coordinator and assistant director of Spanish publications for the Brownsville Herald. He earned a B.A. from the University of Texas at Brownsville (now UTRGV).

Port of Brownsville Foreign Trade Zone Ranks Second in Value of Exports

BROWNSVILLE, Texas — For the third straight year, Foreign Trade Zone No. 62 (FTZ) at the Port of Brownsville ranks second in the nation for the value of exports, according to the U.S. Foreign-Trade Zones (FTZ) Board’s annual report to Congress released Wednesday, Dec. 12, 2018.

The port’s FTZ reported more than $3.5 billion in exported goods in 2017. Additionally, FTZ No. 62 ranked 18th nationally for the value of imports totaling more than $3.6 billion. The Port of Brownsville FTZ has consistently ranked in the top five nationally since 2012, earning the number 1 spot in the nation in 2012 and 2013. The port’s FTZ has ranked second in the list for three straight years now (2015, 2016, 2017).

“The Port of Brownsville continues to maintain a standard of excellence as the leading economic engine in the Rio Grande Valley,” said John Reed, Brownsville Navigation District Chairman. “The zone’s steady growth in cargo movement provides greater job opportunities to our region, driving our economy forward.”

FTZ No. 62 is administered by the Port of Brownsville and includes magnet sites at FINSA Industrial Park at Los Indios, NAFTA Industrial Park in Brownsville, Brownsville-South Padre Island Air Cargo Complex, Port of Harlingen, Valley International Airport Industrial Park, as well as the Port of Brownsville. In 2013, FTZ No. 62 was approved for reorganization under the Alternative Site Framework allowing it to operate sites across Cameron County.

“Our customers and port tenants both contribute to the FTZ’s overall success,” said Tony Rodriguez, Director of Cargo Services and FTZ Administrator for the port. “They are essential to the port’s continued economic expansion.”

The 79th Annual Report of U.S. Foreign-Trade Zones Board to the Congress of the United States for 2017 is available at www.trade.gov/ftz. For more information about FTZ No. 62, visit https://www.portofbrownsville.com/about/foreign-trade-zone-no-62/.

Port of Brownsville Chairman’s Award Presented to West Plains LLC

BROWNSVILLE, Texas—The Port of Brownsville presented West Plains LLC with its 2018 Chairman’s Award in recognition of the company’s investments and rehabilitation efforts of the port’s iconic grain elevator.

Brownsville Navigation District Chairman John Reed presented the award to West Plains CEO Amit Bhandari at the port’s annual customer appreciation luncheon, Dec. 4. The event was attended by nearly 200 guests, including local, regional and state public officials, port tenants, community and regional business leaders.

“West Plains’ dedicated investments at the port allow for more quality job opportunities in our region and provide South Texas farmers the opportunity for their products to reach international markets,” said Reed. “We are proud to partner with a company that believes in the port and the people of the Rio Grande Valley.”

West Plains entered into an agreement with the port in 2016 to restore and operate the grain elevator, with capacity to store three million bushels of grain. Since restoration efforts began, West Plains has invested $7 million in its facility, with plans for another $9 million in 2019.

“This award is the result of all the hard work and dedication our West Plains team makes to get the job done,” said Bhandari. “I would like to thank the BND Commission for all the support and trust put in West Plains to be part of the port family and the Brownsville community.”

The company projects its railcar volumes to exceed 3,000 loads by the end of 2018. So far this year, it has handled more than 300,000 metric tons of grains, including yellow corn, dried distillers grain, milo, and sugar.

West Plains currently employs 22 people and utilizes about 200 truckers to regularly move its products.

As part of the company’s Phase 2, it is partnering with the port to rehabilitate the bulk cargo dock in front of the grain elevator, making its facility marine export capable.

The Chairman’s Award is an annual award highlighting the achievements of port tenants in the areas of business growth, leadership, job creation, customer service, innovation, safety, and community involvement. The 2017 winner was International Shipbreaking Ltd.

 

Amit Bhandari, CEO of West Plains LLC (third from right), is pictured with the Chairman’s Award along with company representatives present during the event held Dec. 4, 2018.

Survey Reveals Strong Support for Port of Brownsville as Positive Economic Driver for the Rio Grande Valley

More than 95 percent say port has positive economic impact; 57 percent plan for more port business next year

BROWNSVILLE, Texas — The Port of Brownsville, the only deepwater port located on the U.S.-Mexico border, completed its first public opinion survey of port tenants, logistics, stakeholders and other service personnel, revealing that 95 percent view the port favorably, with 57 percent of respondents planning to increase their port business activity in the next year.

“The Port of Brownsville’s strategic location combined with top dynamic economic industries—including energy and steel—provide the ideal hub for economic growth in the region and bilateral relationships between Mexico and the United States,” said Eduardo A. Campirano, port director and CEO of the Port of Brownsville. “The newly signed U.S.-Mexico-Canada Agreement creates a favorable business landscape, supporting continued regional diversification and job creation.”

Overall, the Port of Brownsville’s future is promising with 94 percent of respondents stating the port is vital in creating a positive impact in the U.S. economy. Other key findings from the survey:

  • IMPACTFUL: Ninety-five percent of respondents are favorable towards the port, with 82 percent citing that the port has a very positive impact on the Brownsville economy. Respondents believe that the Port of Brownsville positively impacts the economies around it, particularly Texas as a whole, thanks to steady job creation and the port’s position in global trade.
  • IMPROVING: Seventy-one percent of respondents say their opinions of the port have improved during the past five years. The Port of Brownsville has become a major economic player responsible for more than 44,000 jobs and with $43 billion in potential new projects in development.
  • EXPANDING: Fifty-seven percent of respondents say they’ll do more business with the port in 2019, with 80 percent citing excellent to good intermodal connections. The majority of its clients agree that the port has the resources needed to help maintain and grow their businesses. Across the board, those who do business with the Port of Brownsville expect to do the same amount of or more business with the port in the next year.

The survey was conducted via 15-minute online interviews among key audiences in October, 2018. The port contacted 3,556 prospective respondents including stakeholders, tenants, operators and logistics personal, among other port service providers. Response rate was 5.7 percent.