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Asciano seeks to rearrange Victoria's ports


Charles Pauka
 
Asciano, the owner of stevedoring company Patrick, has released a discussion paper that suggests a comprehensive rewriting of Victoria’s future port strategy. It also conveniently does away with the introduction of a third stevedore and directs 1 million-plus containers to the Asciano-controlled GeelongPort.
 
The thrust of Asciano’s argument is that the Victorian Government’s proposed $1.3 billion Webb Dock redevelopment is a waste of money and would be better spent upgrading Swanson Dock from its current 2.7 million TEU/year capacity to 4.0 million, and developing GeelongPort to a capacity of one million initially, potentially growing to 2.5 million. This would be followed by the eventual development of Port of Hastings to a capacity of 8 million TEU p.a., but not until 2030.
 
The Webb Dock redevelopment has a number of drawbacks rightly pointed out by Asciano, but is also the Victorian Government’s vehicle for introducing more competition into stevedoring operations in Melbourne. If a Swanson Dock expansion is undertaken instead, that would take place mostly on land already owned and/or controlled by the two incumbents, DP World and Patrick, and would not lead to additional berths and thus would prevent the entry of a third operator.
 
“Swanson Dock is an existing, efficient container port operation. Certainty of capacity through an upgrade of the terminals would be delivered through mutually beneficial contracts with the existing operators confirming their commitment,” Asciano’s paper says.
 
The second masterstroke of Asciano’s plan is the development of GeelongPort as an international container port. First purchased from the state government for $49.6 million in 1996 by TNT, it has consequently been absorbed into Toll Holdings when it bought TNT, and then into Asciano when Toll demerged its Patrick acquisition into the new entity.
 
According to Asciano’s plan, “With development work on the quay line, and channel deepening, a 1m TEU facility, with potential to grow to 2.5m TEU, could be developed at Geelong Port with minimal disruption to existing operations. The stage 1 development is estimated to require investment of approximately $695m, shared between the private sector and the government. Landside rail and road links are in place, requiring only some incremental expansion as volumes increase.”
 
In other words, not only would the government “share” the cost of development at Geelong, but Patrick would inherit a profitable business stevedoring between 1 and 2.5 million TEU a year until 2030. Patrick is GeelongPort’s near-exclusive operator.
 
Quoting Asciano’s paper: “Geelong Port is an existing general port with road and rail linkages. The installation of container equipment and delivering of capacity would be ensured through mutually beneficial contracts with the port operator.”
 
The full paper can be downloaded here.

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