Driving port modernisation
Argentina’s ports are powering ahead with development to meet growing volumes. Alex Hughes reports
In Argentina, the main port focus in the past has been confined to developments at Buenos Aires. However, 2017 will see a whole raft of investment rolled out at various ports throughout the country.
The Port of Quequén has been a direct beneficiary of Argentina's burgeoning agribulk industry.
Thanks to a favourable exchange rate in recent years, the market for Argentina's agricultural exports is on course to more than double in volume over the next decade, from 50m tonnes annually to 120m tonnes.
Growth is already being seen at the port, where turnover of $76m in 2015 is expected to grow by $28m a year once a series of new works are completed in 2017.
Modernisation of the port is being undertaken as a joint venture between the central government, Puerto Quequén authority, the Terminal Sitio 0 company and an agribulk consortium whose members are drawn from Argentina, Paraguay and Brazil. In total, $13 million of investment will be made with the main project a brand new malt house.
In the state of Corrientes, two significant projects have emerged. Of these, the decision by the government to resume construction of the new Itá Ibaté port on the Paraná River after 21 years is the most significant.
Ité Ibaté is located on the river's left bank, 154 kilometres north of the provincial capital. The decision to dust off previous plans was prompted by the fact that the original port is currently experiencing restricted operations due to intense flooding. Local politicians have been unable to fund repairs to infrastructure due to the high cost involved, leaving just a limited barge service to operate between Ité Ibaté and the border town of Panchito López, in Paraguay.
The planned new facility, which will handle both barge trains and container vessels, will transport mainly rice and timber for both domestic consumption and export to countries such as Brazil, Canada, Chile, the European Union, Irak, Iran, and the US.The project, which has a budget of $20.85m, will take around 14 months to complete. Work includes construction of a 237-metre long quay, which will be 30m deep. Sixty-metre long and 12-metre wide barges will be able to pick up bulk consignments of rice. Container vessels of up to 90 metres in length will also be able to call, while log traffic is also forecast. Two berths are planned to enable simultaneous loading and unloading of a pair of vessels.
As is the case in many provincial capitals in Argentina, the port of Corrientes city is situated at the heart of the city's historic centre. This makes it impossible to upgrade port operations, which are already constrained by a lack of space for warehousing, equipment and places to park HGVs.
The fix is to move the port beyond the main urban area, where more operating space is available with a new port located down river of the projected second Chaco-Corrientes bridge. The actual spot will be close to El Sombrero.
Although not as high in terms of priority as Itá Ibaté, the economics of moving the port do stack up and it has therefore been included in the regional Belgrano development plan.
River logistics operators are also keen for the port to be moved, since many of them operate larger barges than can currently pass through the interprovincial Manuel Belgrano bridge. Two other freight facilities are planned next to the port: a cargo transfer station and a multimodal hub.
Further south, the Port of Madryn is to upgrade and expand two quays: Almirante Storni and Comandante Luis Piedra Buena, the latter being located in the heart of the old town, and currently used mainly for cruise ships. A budget of $43m has been made available, with work slated for completion at Piedra Buena within 12 months and at Storni within 18 months.
Work at Almirante Storni quay will involve major repairs to the main viaduct, which links the port gate to the operating sectors and carries much of the road haulage traffic. This is currently in a poor state of repair, with structural problems in the piling. This work will be funded by the state to the tune of $31m.
At Comodoro Rivadavia in Patagonia, work is to restart on expanding two quays, one of which is used by the fishing fleet and the other by deep sea vessels. This work was halted in 2011, when it was 90% completed, and many of the structures have begun to degrade.
Its completion will effectively double capacity: the deep sea quay will be lengthened to 288 metres and allow two vessels to berth simultaneously, while the fishing quay will be 192 metres long. In addition, a further berth, which will be put in operation in six months’ time, will be for the exclusive use of the Admiralty, and will cost $4m.
Finally, at Ushuaia, work is slated to begin on expanding the port and upgrading existing infrastructure to improve use of the quay, for which $26m will be invested over a two-year period.
As for the port of Galván, in Bahía Blanca, it has been granted $10.6m in the most recent government budget. This will fund construction of a multipurpose berth for the handling of dry bulk. Five million dollars will be made available this year to enable around half the work to be completed.
It will built opposite Berth 5, in the port's Cangrejales sector. Once completed, it will effectively complete development of Galván harbour and allow vessels of up to 400 metres in length to berth.
Galván, which has evolved in the shape of a diamond, would become more of a traditional “U” shape, according to consultant Jorge de Mendonça, who says that its construction will reduce maintenance costs associated with silting.
While the above port projects all have state backing, that at Colonia Aquino, in the north-eastern state of Formosa, does not. If this deep water facility is to be built, it will have to be with private capital.
Similarly, the government seems to have opted out of the related project to rebuild the railway line linking Embarcación with the port, on which there would be four freight hubs, and a major logistics centre within Formosa city itself. The project, which would cost $36m, will now be offered as a 30-year concession.
Carlos Blas, managing director of the Plan Belgrano en Formosa business unit, notes: “When we went to the national government, we encountered the frustrating reality that neither the C25 rail branch nor the port of Colonia Aquino were included in the Belgrano development plan or in the ports plan. In both cases, this is infrastructure that is so fundamental and emblematic for the state of Formosa and its output, [given that it requires] a functional port-rail complex, which can also connect us to the Paraguay- Paraná inland waterway network.”
Another new port, known as Cargill Villa Gobernador Galvez, has also been given the go ahead. The port will be operated as a concession by Bahía Blanca Port and Cargill SA. The proposed terminal operation will consist of two quays: the deepsea Muelle de Ultramar and the Muelle para Barcazas, which will handle barges. This will be located on the right hand bank of the Paraná River at KM408, close to Villa Gobernador Galvez, in the province of Santa Fe. The quays have been designated for targeted traffic by private companies operating in the commercial and industrial sectors.
SANTA FE LICKS ITS WOUNDS
Not all port projects in Argentina are going according to plan. On December 26, Loginter SA ended its concession at the Port of Santa Fe, after having successfully extended it over a period of more than a decade.
On December 2, a tender for the concession was effectively declared null and void after no bids were received. This would have extended the concession for the container handling facility for a further ten years. Three companies, including Loginter, bought the concession documents, but none finally thought it worthwhile to bid.
Contributing reasons for the lack of interest include the complicated nature of the business involved, which requires certain conditions to be fulfilled in order to continue attracting cargo, something which is no longer guaranteed. In addition, rule changes have made making money extremely difficult.
Terms and conditions in the tender document were also not thought to reflect the existing reality of business in Santa Fe, but were more akin to those in Buenos Aires.
The decision by Loginter to quit its concession area also leaves Santa Fe without customs clearance facilities, nor is there a scanner with which to screen cargo. Talks are already under way between various interested parties to find a way to continue handling traffic at the terminal in the interim.
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