Rethink on ports strategy

22:35, May 06 2012

Auckland Council is going back to basics on its port strategy, commissioning a study that could reconfigure port investment and transport infrastructure in the upper North Island and even considering totally new port sites.

Greater co-operation between the ports of Northland, Auckland and Tauranga and more efficient allocation of capital are among possible outcomes once the study is complete.

The council is commissioning consultants to estimate the future flows of imports and exports through the ports in the upper North Island and the road and rail networks and associated transport hubs.

"The upper North Island must be able to meet short and long-term growth requirements of an export-driven economy. The capacity of its ports and the associated freight transport system are key elements in the ability ... to achieve this. There is considerable debate on what the most optimal future port infrastructure, configuration and freight transport supply chain arrangements should be," a background briefing document for consultants said.

Merchant banker Michael Lorimer of Grant Samuel, who has been involved in the preparation of commercial reports on Ports of Auckland and is a vocal critic of the way its current industrial dispute has been handled, said he hoped the report would pave the way for more co-operation between the ports, particularly Auckland and Tauranga.

What form that co-operation would take would be "anybody's guess", he said, but would not necessarily involve a formal merger of the Auckland and Tauranga port companies.


It could take the form of operational agreements or other arrangements to manage trade in the most efficient manner.

"And reduced costs could then be passed on to importers and exporters," he said.

It is significant that although the report is being commissioned by Auckland Council, it is doing so on behalf of the Upper North Island Strategic Alliance, a planning group for the Whangarei, Northland, Auckland, Hamilton, Waikato, Tauranga and Bay of Plenty councils.

Lorimer said the report would help plug a significant gap left by the Government's failure to adopt a national ports strategy.

It could be particularly helpful to the councils that are the major shareholders in Northport (at Marsden Point), Ports of Auckland and Port of Tauranga, when they assess the future capital needs of the ports in their areas.

The background document on the report said it should provide "independent, robust and credible analysis, modelling and data about current and future freight demand and supply, incorporating scenarios to meet that demand" and should address such factors as:

Key international shipping trends and competitive shipping practices, including the potential future role of coastal shipping;

The strategies and plans of major exporters and importers;

The investment strategies of other ports, such as those in Australia and the Pacific Rim;

The current freight land transport network and supply chain strategies.

The background paper said the report should also estimate the ability of the upper North island ports to meet future freight demand based on such factors as access to land, changes to ship size, rail corridor capacity and availability of transport links and inland freight hubs.

"The results of this study and any subsequent decisions/actions or further work undertaken could have significant and long-term implications for the upper North Island's economy and its associated ports and transport infrastructure," it said.

In Auckland, the council could use the information in the report as a basis for further work "to propose and assess future port development options for Auckland and the downtown port area".

The background paper said such further work might consider factors such as:

Different configuration alternatives at the current port locations, or as-yet-unexplored alternative locations for current port infrastructure;

High level capital and operating costs;

Economic costs and benefits of various options;

Alignment of, or gaps in current freight land transport strategies and plans.

Lorimer said the report could play a critical role in planning the future of the region's transport system, provided it was " a robust study undertaken by somebody who knows what they are doing".

Sunday Star Times