Texas Ports Still Adjusting to Panama Canal Expansion
Feature Photo (above): The container handler cranes at Velasco Terminal at the Port of Freeport. Courtesy: Google Streets/Sonia Ochoa.
By Edmond Ortiz
A ribbon cutting ceremony held June 28 at Port Freeport celebrated the completion of the $21 million Phase I rail development project–21,000 linear feet of track.
The Union Pacific to Port Freeport connection was one of many projects in progress this summer at Texas seaports that have been playing catch-up with the increased traffic resulting from the Panama Canal expansion. In the years prior and during the Panama Canal project, 2007-2016, Texas port authorities had to contemplate and prepare for the impact it would have on the state’s economy and maritime infrastructure.
Phyllis Saathoff, Port Freeport’s executive director was able to welcome the port’s first ship that traversed the new canal just three months after it opened. And in November 2017, the port’s commissioners extended their Memorandum of Understanding with the Panama Canal Authority for an additional five years.
The $5.3 billion expansion project doubled the Panama Canal’s capacity by adding a new traffic lane that allowed passage of larger deepwater ships, as well as the passage of ships in greater numbers. The massive project has been felt ever since at ports all along the Gulf of Mexico and the East Coast.
Excepting its many fishing villages, such as Port Lavaca and Rockport, Texas has nine commercial cargo ports and eight of them directly handle seafaring cargo.
Port of Beaumont
Port of Brownsville
Port of Corpus Christi
Port of Freeport
Port of Galveston
Port of Houston
Port of Port Arthur
Port of Texas City
Port of Victoria
Of the nine ports, seven have had to make major investments in upgrading their infrastructure. The Port of Galveston, although it handles some cargo, is more focused on servicing cruise ships for the tourism industry, and the Port of Victoria is just a 35-mile barge canal with a 12-foot depth, incapable of accommodating seagoing ships.
The Port of Houston ship channel. Courtesy: Port of Houston.
Some ports are more focused on landside infrastructure such as improved rail service, expanding docks and container handling. This is particularly so for the ports of Freeport, Beaumont, Texas City and Port Arthur. The Port of Beaumont, for instance, launched into a $169.2 million capital investment program beginning in 2017; three of the dozen projects listed include a new $79 million terminal, a $13.2 million rail interchange track and a $10 million highway flyover.
In April, the Port of Port Arthur began installing pilings to support a 600-foot dock extension–a $37 million expansion project. And plans are already underway to raise another $55 million to add another 300 feet of multi-use dock space.
In addition to upgrades of landside facilities, Corpus Christi and Brownsville are also proceeding with channel dredging to accommodate larger vessels.
Port of Houston
Houston, on the other hand, is still discussing another channel dredging project. While it is by far the state’s largest port authority, its leadership is scrambling to get funding for a second channel expansion in less than 20 years.
In the first decade of this millennia, the Port of Houston invested heavily in new infrastructure. The channel was deepened and widened, and two container terminals were linked to the main channel. This lured Asian exports away from West Coast ports.
Then the U.S. government lifted a 40-year ban on crude exports in 2015. This put the Port of Houston in a strong position to play a key role in global crude oil and propane trade. But the managers of the nation’s fifth largest container port face conflicting challenges.
While the Houston Ship Channel needs further expansion, newly adopted state legislation limits the size of container ships in the channel. This slows down the traffic coming through today in a port that is known for its bottlenecks.
Matt Gallagher, president and chief executive officer of Parsley Energy, an independent oil and gas company, ran an op-ed piece in March in the Houston Chronicle. He said state and federal governments should work together with the private sector to increase investments in export facilities nationwide, especially along the Gulf Coast.
“Expedient collaboration between the private sector and policymakers on projects like the deepening of the ship channel in Houston, the expansion of the port in Corpus Christi, and new deepwater ports like the Texas Gulf Terminals Project will be critical,” Gallagher wrote.
“Environmentally responsible efforts to expand and create new export facilities should be prioritized and streamlined.”
Now, the Houston port authority is working with the federal government and other stakeholders to obtain authorization and accelerate funding toward again deepening and widening the ship channel, a project that could cost $1 billion. Some stakeholders suggest that dredging the channel another eight feet would be ideal.
Port of Houston Chairman Ric Campo told the state Senate Select Committee on Texas Ports in March that the port authority needs help from the state and federal government to dredge the channel, and do it sooner than later. Vessel collisions in the ship channel in the last few years have compounded the issue of widening the channel.
“We need to solve this problem. We’re going to solve this problem,” Campo added.
Meanwhile, the Houston port authority is designing or already working on several smaller scale upgrades, such as rehabilitation of some wharves, expanding gate facilities, concrete pavement and container yards, and repairs and/or replacement of rail and rail switches. Many new construction projects at the Port of Houston are set to begin within the next 12 months.
The Port of Brownsville ship channel. Courtesy: Port of Brownsville.
Port of Brownsville
Port of Brownsville, the lone deep-water seaport on the U.S.-Mexico border, is a step closer to deepening its ship channel after securing a vital permit June 6 from the U.S. Army Corps of Engineers (USACE). It’s part of the planned $350 million Brazos Island Harbor Channel Improvement Project.
The port and its partners plan to deepen the ship channel from 42 feet to 52 feet, using a blend of public, private and federal money.
NextDecade Corp., one of the project partners, will completely pay for the channel-deepening work from the Gulf of Mexico to the western border of the proposed Rio Grande liquified natural gas project site at the port, about a 9-mile distance.
Steve Tyndal, Port of Brownsville senior director of marketing and business development, told VBX that channel dredging could begin within 12 months. The deepening will take about 24 months.
When that’s completed, Brownsville will be one of the deepest ports on the Gulf of Mexico, strengthening its competitive position by matching design features of the expanded Panama Canal.
Tyndal explained that when the Panama Canal opened in 1914 at a 40-foot depth, all other seaports worldwide opened at the same depth in order to accommodate the seagoing vessels that used the canal at the time.
The new locks at the canal are wider than the old locks – 180 feet vs. 110 feet – and deeper — 60 feet vs. 42 feet.
“We will then be at the maximum (depth) to match whatever comes through the canal,” Tyndal added.
Tyndal said deepening the Brownsville ship channel and development of the Rio Grande LNG, collectively, could make Port of Brownsville an even bigger asset in the export marketplace.
“This levels the playing field for us to compete with other ports that permit larger and more vessels,” he added.
Port of Brownsville is currently carrying out other infrastructure improvements, including construction of a new liquid cargo dock, and rehabilitation of an existing liquid cargo dock.
While Houston and Brownsville are waiting for things to fall into place to dredge their ship channels, the Port of Corpus Christi is already taking action to grow its channel to accommodate the increasing traffic to/from the Panama Canal and other waterways.
A tugboat running its water pumps in the Corpus Christi ship channel during the ceremony celebrating the channel dredging project. Courtesy: Port of Corpus Christi.
Port of Corpus Christi
Local dignitaries gathered May 29 to celebrate the start of work to deepen the channel from 45 feet to 54 feet, and to widen it from 400 feet to 530 feet.
It’s part of a larger, multi-phase channel improvement project that will cost more than $345 million and last through at least 2021.
In January, the U.S. Army Corps of Engineers awarded a $92 million construction contract to Great Lakes Dredge and Dock Co. (GLDD) to handle this first phase of the channel improvement project.
Phase I work is slated to be done sometime next winter. Port leaders said the channel upgrades will only bolster Corpus Christi’s position as a top crude oil exporter. Overall, Port of Corpus Christi is presently in a 10-year, $1 billion capital expansion program.
“We are building and enhancing infrastructure and collaborating with new partners as we prepare to accommodate major growth in crude oil production,” Port CEO Sean Strawbridge said in a press release.
Port of Corpus Christi is also supporting an ambitious proposal, the Texas Gulf Terminals Project, where the company Trafigura envisions a new onshore storage terminal facility off Laguna Madre to store ready-for-loading crude oil.
The project would include 12 miles of onshore and inshore pipelines, and 14.7 miles of offshore pipeline to transport the crude across North Padre Island to a single-point mooring in the Gulf.
Environmentalists and leaders in smaller communities in the immediate area have criticized Trafigura’s proposal for posing a risk to the fragile local ecosystem.
Brandon Creighton, R-Conroe, chair of the Texas Senate Select Committee on Texas Ports, has said these and other infrastructure improvements are designed to work in concert to further boost Texas ports’ position in the global marketplace.
“As improvements to the Panama Canal create a flow of larger vessels from distant trading partners, we have to ensure that Texas ports are equipped their economic leadership role in the most economically free way possible so that commerce can advance,” he added.
Edmond Ortiz is a San Antonio-based freelance reporter and editor. He has worked for the San Antonio Express-News and Prime Time Newspapers. He is a contributor to Virtual Builders Exchange and the Rivard Report. His Twitter handle is @satscribe.
Adolfo Pesquera (Reporter/Editor) is a veteran news journalist. He has worked for Hearst Corp., American Lawyer Media, News Corp and Freedom Communications. His work has been published in newspapers and magazines across the USA. He is a journalism graduate of UT-RGV. He writes, edits and creates digital pages for VBX.