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Issue #591

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Terminal Operators

Air Cargo Quarterly

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2014 Media Kit

Rotterdam port: govenment must fix infrastructure

By: | at 07:00 PM | Ports & Terminals  

The Dutch government must address infrastructure problems and other bottlenecks around Rotterdam port, Europe’s biggest, that threaten its growth, the head of the port said.

The port is investing 4 billion euros ($5.26 billion) over the next few years on a massive land reclamation project and on upgrading existing facilities, to increase capacity and cement its position as a major transit point for commodities including oil and grains, as well as for manufactured goods.

But Hans Smits, the chief executive, told Reuters the port’s development could be hampered if the Dutch government does not take faster steps to improve transport in the port area and allow the use of wind turbines and carbon dioxide (CO2) storage.

“The sense of urgency in Europe needs to be on a higher level,” Smits said in an interview.

“In the Netherlands, don’t take it for granted that it’s going well in our port. We have to speed up our development.”

Top of Smits’ list for the government are a road and tunnel project that would relieve congestion around the port, legislation on storage of greenhouse gas CO2, and faster processing of permits to set up wind turbines next to the port’s new land reclamation project, Maasvlakte 2, to provide power.

“It takes too much bureaucracy, too much talk to realise it,” he said. “Investing in transport infrastructure is one of the best means you can take to stimulate economic growth. I’m always surprised politicians do not realise that.”

Smits said that the government needs to change legislation to resolve uncertainty over liability if CO2 is stored in depleted oil and gas fields in the North Sea.

Carbon capture and storage (CCS) is a pioneering technology which involves trapping CO2 emissions from industrial processes and piping them underground or offshore below the seabed.

Smits advocated a special tripartite agreement to clear the way if legislation on CO2 legislation takes too long to amend.

“If you can’t solve it in a legal way, then make a special arrangement between the government, the energy companies and the owners of the oil and gas fields to solve the issue”, allowing CO2 produced by activities in the port to be stored, he said.

The Dutch government recently shelved a plan to store CO2 underground in the town of Barendrecht in the west, because of local opposition, but said it remains committed to CO2 storage.

Some environmentalists say CCS is unsafe and could divert investment away from truly green sources of power.

The Rotterdam area, a major hub for oil, coal and biofuels, produces about 16 percent of the Netherlands’ total CO2 emissions, and is counting on CCS to help it halve emissions in the area by 2025 compared to 1990 levels.

Expansion
Rotterdam expects the first ships to berth at Maasvlakte 2 in 2013. The land reclamation project will increase the port’s area by a fifth by the time it is completed in 2033-2035, allowing it attract new business.

The port is investing 2 billion euros in Maasvlakte 2, part of a total 15 billion euros investment by the government, private sector and port.

Funding is already in place, Smits said, and ruled out the need to seek a stock market listing or equity from Chinese or other companies that use the port.

“Because of the importance of the port to the Dutch economy it wouldn’t be wise to have shareholders who also have commercial interests because then you lose your neutrality.”

But he said Chinese companies are still interested in investing in the port’s facilities, adding that China’s Sinopec Corp is one of the potential bidders for a tank terminal tender this year.

The Chinese oil refiner wants to use Rotterdam as an oil hub, bringing in crude oil from Russia, blending it in Rotterdam before sending to China, he said.

Rotterdam is also keen to invest abroad as a means to bringing in new business: it has two joint ventures in Oman that Smits said had led to consultancy work in Qatar, potentially opening the door for Qatar to supply liquefied natural gas (LNG) through R