ICTSI to build $30M Manila-Cavite barge terminal
Port operator International Container Terminal Services, Inc. (ICTSI) will construct the Philippines’ first barge terminal for shipping containers between the Port of Manila and Cavite, a project that could potentially reduce annually truck trips on city roads by 140,000.
ICTSI—together with partners freight forwarder Orient Freight International, Inc. and marine services provider Harbor Star Shipping Services, Inc. (HSSI)—will operate Cavite Gateway Terminal (CGT) on a six-hectare property owned by the port operator in Tanza, Cavite.
Phase 1 of CGT has a projected cost of US$30 million.
ICTSI senior vice president and head of Asia Pacific region Christian Gonzalez, in a press conference on December 15, said that “instead of finding negative solutions in truck bans and other manners of regulation that we know don’t work, we came up with a solution that’s been tried and tested in other places around the world, which is to use our waterways which are not congested, which are very efficient, which will be cheap, and which will essentially allow the development of more economic activity in the province of Cavite.”
He cited as an example Hong Kong port, one of the world’s busiest terminals, which also uses barges to ship containers to Shenzhen.
He added that the project complies with the Philippine government’s request to find alternative ways to move traffic and spur growth in the provinces.
Shipping containers by barge has earlier been tried between the ports of Manila and Subic. At the height of the Manila port congestion in 2014, Super Shuttle Marine Services, Inc operated the Subic Super Shuttle.
Container Terminal Services, Inc.’s (ICTSI) plan to construct a barge terminal for shipping containers between Manila and Cavite, from L to R, Orient Freight International, Inc. chairman Monchu Garcia, ICTSI senior vice president and head of Asia and Pacific region Christian Gonzalez, Transportation Assistant Secretary for Maritime Fernando Juan Perez, Philippine Ports Authority general manager Jay Daniel Santiago, Transportation Assistant Secretary Cherie Mercado-Reyes, and harbor Star Shipping Services, Inc. Geronimo Bella, Jr.
Initial phase
Phase 1 of CGT involves pier and yard infrastructure, equipment, and support facilities. The first phase can support a total output of 115,000 twenty-foot equivalent units (TEUs) per year, equivalent to about 140,000 fewer truck trips on city roads annually, Gonzalez said. HSSI will deploy three 150-TEU barges on the route.
Gonzalez said Phase 1’s volume will only account for 50% of the total exports going out of the Cavite Export Processing Zone (CEPZ); imports are not part of the equation.
Orient Freight chairman Monchu Garcia said there are about 240,000 containers annually just for CEPZ locators, which could potentially mean 900,000 to 1 million TEUs of truck trips annually if there are four truck trips per shipment cycle.
Succeeding phases of CGT will be built to support a substantial increase in capacity in anticipation of annual volume increases in the Cavite market, according to Gonzalez.
Despite the challenges in marine engineering, Gonzalez said Phase 1 can be built in six to eight months, or even earlier, after approval of permits.
Gonzalez said the project is supported by the local, provincial, and national government, as well as the Philippine Economic Zone Authority (PEZA) that mainly oversees CEPZ.
He added that the project will “continue to allow us to expand and improve operations in the Port of Manila” without having an impact on Manila and adjacent cities.
He noted that PEZA and a number of zone proponents have been really looking to push additional investments in municipalities and cities in Cavite but are hindered by limited road access.
“This essentially changes that landscape. It opens these new zones to major investment from foreign players because they will be directly connected to the Port of Manila,” Gonzalez said.
Benefits
HSSI, in a presentation during the press con, listed as among the project’s benefits the transport of more volumes for lesser carbon footprint, “no toll fees, no truck bans, no kotong [bribes].” It also provides an alternative mode of utilizing the country’s water system.
Transportation Assistant Secretary Cherie Mercado-Reyes said CGT will be a common terminal, open for use by other terminal operators at Manila port for barging containers to and from Cavite.
Philippine Ports Authority (PPA) general manager Jay Daniel Santiago said the terminal will operate as a private port under its jurisdiction. He noted that other operators are also welcome to come up with the same concept for different locations, subject to PPA’s review. Transportation Assistant Secretary for Maritime Fernando Juan Perez said they are open to the same business model being applied in other areas.
HSSI chairman and president Geronimo Bella, Jr. said the distance from Manila to Cavite is only 25 nautical miles so at a speed of 8 knots, shipping time from Manila to Cavite will only take four hours against almost one day by truck.
The company will initially deploy three sets of tugs and barges per day with a minimum of 55 TEUs to 100 TEUs per trip.
Asked about the price of the service, Bella said it would be “very competitive” against trucking cost.
On whether the terminal will be bonded, Gonzalez said it is to be PEZA-bonded, but if the need arises to have it customs bonded or allow non-PEZA shipments to be cleared there, then they would apply for that, too.
Santiago, meanwhile, assured truckers will not be too affected by the project since they already operate in Cavite, where majority of Manila port’s volume goes. Instead of navigating Manila traffic, trucks can service containers coming from CGT to PEZA zones. – Roumina Pablo