The Virginia Port Authority (VPA) announced that its operating company, Virginia International Terminals Inc. (VIT), signed a 10-year agreement with its third largest customer, the New World Alliance.
The 10-year, $175 million contract guarantees that the global shipping alliance’s vessels will be calling at the VPA terminals through 2016. The contract, said Joe Dorto, VIT’s CEO and general manager, took six months to negotiate and was finalized earlier this week.
‘I believe this contract should be worth more than $175 million because that value does not include any (cargo) increases New World may have ’ that amount is the minimum,’ Dorto said. ‘Feasibly, over 10 years, this contract may be worth closer to $200 million. Like so many of our other customers, the leaders at New World wanted to guarantee a place for their ships and guarantee capacity at our port. We now have 81 percent of our business wrapped up in 10-year contracts.’
New World Alliance vessels have been coming to The Port of Virginia since 1998. Vessels from Mitsui, APL and Hyundai ship lines make up the alliance and all of its ship calls are at Norfolk International Terminals north berth, which is one of the VPA’s three deep-water marine terminals. The other terminals are Portsmouth Marine Terminal and Newport News Marine Terminal.
The New World Alliance contract is the latest in a growing list of long-term agreements the VPA’s terminal operator, VIT, has signed with its customers. Since early 2005, the Grand Alliance, CKY, China Shipping, Turkon, MSC, ACL, CMA-CGM and Emirates have all signed 10-year agreements with VIT.
‘We see this as another vote of confidence for our port and for our expansion plans,’ said Thomas Capozzi, the VPA’s director of marketing. ‘This commitment by NWA further solidifies The Port of Virginia as a port of choice for some of the world’s biggest shipping alliances and ship lines.”