Port of Virginia advancing program to keep growing container volumes

The Port of Virginia’s CEO John Reinhart says in the last twenty months the Port “has changed the dialogue from survival to a dialogue of future planning, sustainability, continued economic growth…” And the timing couldn’t be better as the growth in East Coast cargo is boosting box totals. Already moving record containerized cargo volumes, the Port of Virginia is advancing a multibillion-dollar plan to further its position as a favored gateway for reaching consumers of the mid-Atlantic and beyond. In an interview with the American Journal of Transportation, John F. Reinhart, chief executive officer and executive director of the Port of Virginia, said he sees Virginia terminals reaping benefits of increasing preference for East Coast routings – a shift he believes demands infrastructure enhancements at ports all along the Atlantic seaboard. “The Port of Virginia has turned itself around in the last 20 months,” said Reinhart, who assumed the top job at the Port of Virginia in early 2014, after retiring from the role of chief executive officer of Norfolk-based Maersk Line Ltd. Indeed, in the fiscal year ended June 30, the Port of Virginia realized a $16.1 million profit – a $31.5 million turnaround from the preceding fiscal year and the port’s first yearly operating profit since 2008. “We have changed the dialogue from survival to a dialogue of future planning, sustainability, continued economic growth, and we’re building the capital plans to achieve that,” Reinhart said, who is quick to call the turnabout a collaborative success, encompassing labor and other industry partners and stakeholders, as well as the entire port team. “I believe we have the right internal workforce, I think we have the right systems and plans, and I believe we’ve got the political support that’s required to make this port come alive as the gateway in the mid-Atlantic and the gateway to the heartland of the United States for decades to come,” he added.

The Port of Virginia is on pace in 2015 to eclipse by about 9% the prior record container volume of 2.5 million 20-foot-equivalent units set in 2014. With increasingly large containerships destined to transit the post-expansion Panama Canal, joining those transiting the Suez Canal in all-water service from Asia, Port of Virginia plans call for accommodating significant increases in container volumes. “We’re very excited about what the future years will hold as we implement these strategic plans,” Reinhart said. “We’re trying to live up to our values, which is to be a steward of tomorrow, and I think we’re doing the right thing today to prepare for a brighter future for Virginia and for our industry. “The East Coast has a bright future as cargo shifts and population shifts east, and we need to have other great ports to partner with, because it can’t just be one port wins all,” he said. “We need to see the infrastructure improvements continuing up and down the coast to encourage the larger ships to call the East Coast, so it’s not a zero-sum game here.” Reinhart said it is imperative to address all aspects of infrastructure, from channels to terminals to inland links. “Every one of them has to have attention paid or you will not survive in the long haul,” he said. “It takes a coordinated plan on your investment in infrastructure for both water depth, berth construction, upland facility construction and container-handling capability and gates, interface with rail, and then the ties to the roads that need to be improved to get the cargo the first and last mile. You’ve got to be efficient.” In the current fiscal year, a $135 million capital plan is in place for projects within the boundaries of Virginia Port Authority facilities, not including roadways and other undertakings outside the gates, such as corridors built by public-private partnerships to accommodate double-stack containers on CSX Corp. and Norfolk Southern Corp. rails heading to the Midwest and other inland markets. The port started work on the first of its current capital projects in July, breaking ground on the $31 million expansion of the North Gate at Norfolk International Terminals. About half those funds are coming from a federal Transportation Investment Generating Economic Recovery grant. That expansion, which is to provide 22 truck lanes for ingress and egress, ties into another project for which ground was broken in July – the Virginia Department of Transportation’s $169 million Interstate 564 connector.

VIG II Near-future projects, now under design, include a $320 million expansion of the automated container terminal at the privately owned Virginia International Gateway in Portsmouth (an undertaking dubbed VIG II) and substantial densification of the south end of the VPA’s Norfolk International Terminals facility, or NIT. “They’re not mutually exclusive,” Reinhart said of these two endeavors. “They both can be done.” The completion of both the VIG II and NIT south end projects would as much as double the overall container-handling capacity of the Port of Virginia, according to Reinhart. More than $2 billion of critical infrastructure projects are identified in a 10-year plan “that will need to be financed to keep pace with the size and growth of the ships calling the East Coast and trade coming via the East Coast,” Reinhart said. “We’ve also been continuing to hire and develop personnel in operations, supply chain logistics, maintenance, security, IT [information technology] and other support functions so we can continue to grow our business, as well as working with our ILA [International Longshoremen’s Association] partners to increase the local workforce by almost 500 in the last year, so that we’ve had a surge of new trained competent people to work the cargo volumes that are coming across our docks and stay in step with the pace of change,” Reinhart said. The new jobs bring to 2,300 from 1,800 the number of ILA workers at the Port of Virginia. Regarding the ILA, Reinhart commented, “I think they’re happy with the opportunity to continue to work and grow their workforce, and they’re happy that we’re putting infrastructure and maintenance back in focus so that they have reliable equipment to operate and they have a safe working environment in which to operate.” Beyond the docks, the VPA is moving forward with deepening and widening of key channels under a partnering agreement with U.S. Army Corps of Engineers. Study is advancing on plans to bring some areas to already-permitted depth of 55 feet and to 45 feet on the Southern Branch of the Elizabeth River, while also widening the channel to improve two-way vessel traffic flow, including coordination with U.S. Navy vessels. Reinhart said 2024 is “the outside target” for completion of the channel work.