In the Port of Portland Oregon, ICTSI Oregon, Inc., a subsidiary of International Container Terminal Services, Inc., (ICTSI) officially took over operation of the Port of Portland’s Terminal 6 on February 12th. This was big news for the Port, but there is a lot more going on as witnessed by 2010 becoming the “year of recovery” for the Port of Portland.By George Lauriat, Editor-in-Chief, AJOTThe big news in Port of Portland occurred on February 12th when ICTSI Oregon, Inc., a subsidiary of International Container Terminal Services, Inc. (ICTSI), officially took over operation of Terminal 6. It was an important step for the Port agency, which had for several years been examining various options for managing the facility that handles both container and break bulk. In some respects, the announcement put the exclamation mark on an excellent 2010 and a very good start on 2011. Last year the Port handled over 180,000 teus, 4.7 million tons of grain, 5.2 million tons of mineral bulks and over 260,000 autos. Still the big news was inking ICTSI Oregon, Inc. as the management for Terminal 6. The move involved considerably more than simply bringing in new terminal management; this was a fundamental change in the business model. The Port of Portland was one of the last ports on the West Coast to have a traditional hands-on management system as opposed to a landlord-tenant business model. Sam Ruda, Director of Marine and Industrial Development, at the Port explained, “We needed to take a fresh look…a close examination of our terminal operations model.” The Port initially looked at various operating scenarios during the terminal buying spree that saw private investment scooping up public facilities. However, with the subsequent economic nosedive, investment stopped and a reassessment was in order. In 2008 Ruda initiated a strategic review of the Port’s existing operating model, and in turn this review sparked a global search for a terminal operator. In some ways, Manila-based ICTSI seems like an unusual fit for Portland. The terminal operator has flown under the radar, attracting less attention than the global giants like Singapore’s PSA, Hong Kong’s Hutchinson Whampoa, DP World in Dubai, or the Danish marine conglomerate, Maersk’s APM Terminals. In the US there were big players to consider like the Pacific Northwest’s own SSA or Ports America, each better known in the American market. Yet the terminal company ICTSI is the fifth largest in the world and has a remarkable portfolio of facilities. This is the stevedore’s first US terminal project, but in Latin America ICTSI is constructing new container terminals at the port of Manzanillo, Mexico and La Plata, Argentina. The Port liked ICTSI’s diverse portfolio, as they have a knack for finding niche markets and making them work. But ICTSI is also a legitimate global player that can use their leverage to create business opportunities. Under the terms of the 25-year lease, ICTSI paid the Port of Portland $8 million at closing and an annual lease payment of $4.5 million. As container volumes increase, so too will payments to the Port. ICTSI Oregon, Inc. hired around 20 staff to support terminal operations, but the Port retains responsibility for facility security and for some maintenance functions on-site. 2010 “The Year of Recovery” Josh Thomas, who handles the Port’s media for marine & industrial development, characterized 2010 as “The Year of Recovery” for Portland and that might be a little modest. Last year was a very good year for the Port on a number of levels. Containers, a sector that really isn’t the Port’s strong suit, were up 4%. The Port handled over 96,000 inbound teus and nearly 85,000 outbound teus. The best part was that Terminal 6 added new customers like Westwood Shipping Lines, which provides service to Japan, and Gearbulk, which has imported thousands of new 53’ containers for use in domestic intermodal transportation. Both could add to the tally for 2011, which already has the Port over 32