MarEx "Daily News"

The MarEx "Daily News" can be read at http://www.maritime-executive.com

June 17, 2005

Record $5.29 Billion Approved For Army Corps Civil Works Budget

After approval of a nearly $31.25 billion funding bill today that includes $5.29 billion for the U.S. Army Corps of Engineers' Civil Works program, American Association of Port Authorities President/CEO Kurt Nagle praised the Senate Appropriations Committee and its chairman, Sen. Thad Cochran (R-MS), noting that "the stage is set for the Corps to get a budget that will enable it to better meet the nation's water resources needs."

Nagle also applauded Energy & Water Subcommittee Chairman Sen. Pete Domenici (R-NM) for his work in providing the leadership for developing and moving the bill through the subcommittee mark-up process and sponsoring the bill in full committee.

"The Senate Committee's approval today of $5.29 billion for the Corps' FY'06 Civil Works program is a very positive signal that navigation projects at our nation's seaports will get more of the funds they critically need to start, complete and/or maintain waterways that are crucial to our nation's economy," said Nagle. "The Administration's Civil Works budget recommendation this year was a paltry $4.513 billion, which would have been 4 percent less than last year's appropriation. AAPA and our member ports were deeply concerned that, had the Administration's proposed budget been adopted, the channels and harbors that ships depend on for moving people and freight would be severely compromised."

Access to our nation's ports and waterways ensure jobs for nearly 5 million people who work in the U.S. marine transportation industry. Waterborne commerce, which is dependent on accessible ports, harbors and channels, contributes more than $729 billion annually to U.S. international trade.

AAPA immediately raised concerns when the Administration's FY'06 budget was first announced. At a news briefing in February, Nagle said that under-funding the Corps of Engineers' Civil Works program would create major challenges for public ports, ocean carriers and their customers to meet the expectations of the businesses and communities they serve, both from a safety and an economic perspective. He noted that each year that new dredging projects are delayed and existing projects go unfinished, "it puts our nation at a competitive disadvantage to export its products overseas and causes the cost of waterborne imports to go up."

AAPA has urged Congress to appropriate at least $5.6 billion for U.S. Army Corps of Engineers Civil Works program for FY'06. Specifically, AAPA has requested appropriations of $735 million for deep-draft navigation operations and maintenance (O&M), at least $500 million for deep-draft construction, and $10 million for new project studies. That compares with the Administration's request of $607 million for harbor and channel O&M, $260 million for continuing construction and $7 million for studies.

June 20, 2005

Michigan Legislators Want Permanent Oil Drilling Ban in Great Lakes

A Great Lakes' coalition of legislators to the Congress want to permanently ban oil drilling in the lakes because of concerns about drinking water, tourism, and jobs that would be threatened by an oil spill.

The bipartisan group said that the Great Lakes provide drinking water to more than 30 million people, and the lakes are critical bodies of water for tourism and the region's economy.

The temporary moratorium on oil drilling in the lakes will expire in 2007. Representative Burt Supak (D-Menominee) said that the 1979 and 2004 drilling in Lake Michigan produced a limited yield of natural gas and oil. He said that opening exploration would not even put a dent in America's oil needs.

However, Canada allows drilling on the lakes and a huge oil spill or natural gas fire could wipe out the ban in the United States. There is a push in Congress to allow state governors to determine whether oil drilling should take place in their state waters.

The Michigan legislators want to take the choice for drilling out of state legislators and governors whims.

June 21, 2005

Detroit Marine Terminal to Reopen

The once bustling Detroit Marine Terminal once handled hundred of thousands of tons of cargo, but it shut down last year because it could not pay its debts.

Millionaire Manuel J. "Matty" Moroun, owner of CenTra Inc., which operates hundreds of trucks and rail lines, has agreed to pay off $3 million of defaulted bonds. In exchange Moroun will become managing partner of the port.

The port's previous owner, Detroit Marine Terminals, defaulted on bonds as U.S. tariffs and the booming demand in China drove up the prices of steel, which was the port's main import and import companies cut back on shipping.

With steel tariffs lifted this year, the new owners expect the port to be reinvigorated. The 35 acre Port of Detroit complex runs 2,150 feet along the Detroit River and can handle three larges vessels up to 1,000 feet. In 1998, the port handled 800,000 tons a steel a year, but imports fell to 80,000 tons in 2003.

Acting Director of the U.S. Maritime Administration (MARAD), John Jamian, has established a study that will examine cargo flows between Canada, Mexico, and the U.S.
MARAD will study the flow of cargo between Detroit, Port Huron, Toronto, Montreal, and several Midwest cities that border major waterways.

"The Port of Detroit," Jamain said. "Should help drive down transportation costs for the entire Metro Detroit region.

June 22, 2005

International Whaling Commission Rejects Japan's Bid for Commercial Whaling

Japan tried to push through a bid that would allow whaling nations to resume commercial whaling. The measure which requires three-quarters majority was voted down by a count of 29 to 23. The 66-member bloc is working on a system to manage whaling should the 19-year moratorium on the industry be lifted.

The New Zealand Conservation Minister Chris Carter said, "It shows that this organization does not want to go back to the bad old days when it was open season for whaling, which is exactly what the Japan proposal would do."

Japan said it considered its text a reasonable compromise, but anti-whaling nations and environmentalists said the proposal fell well short of something they would ever approve.

Environmentalists said the proposal failed to address any of their major objections, such as the suffering of whales under different killing techniques, and how commercial catches would be independently regulated.

Japan kills 660 whales each year under a research program and it intends to kill 1,300 whales next year.

Conservationists say that Japan's research killing is a sham. "How can you kill 8,500 whales over the last 18 years and not have any real science to show for it?" said Carter.

June 23, 2005

Port of Los Angeles Submits $30 Million in Proposals for Round 5 of Federal Security Grants

Seeking to further enhance security measures at the nation's busiest port, the Port of Los Angeles has submitted grant proposals for a total of $30 million in Round 5 of the Department of Homeland Security Grant Program. Awards are expected to be announced by the end of September 2005.

"We submitted a very comprehensive grant application package that will fund several core programs to reduce the risk of security breaches," said Port Homeland Security Director George Cummings. "We are hopeful that this round of grants will be a very successful one for the Port of Los Angeles, and that a majority of our projects will be funded."

The latest round of security grants comes at a key time when the Port is implementing two new advanced security technologies: radiation portal monitors and SAFE(TM) (Secure Around Flotation Equipped) Boats. Radiation portal monitors are currently being installed at container terminals within the Port of Los Angeles by U.S. Customs and Border Protection. Trucks leaving the terminals with containers pass through the monitors. If a container registers an abnormal radiation level, the truck carrying it is pulled aside for additional screening and inspection.

The Port's two SAFE(TM) boats, scheduled to arrive within weeks, are state-of-the-art $350,000 patrol boats similar to those used by the Coast Guard. The 31- and 36-foot boats will be operated by the Los Angeles Port Police and were purchased with security grant funds awarded in a previous round.

The Port's current grant application includes funding for surveillance and access control systems, port-wide security system networking, explosive detection equipment and the next phase of the Joint Container Inspection Facility. The Port's grant application package includes cost sharing by the Port of 25%, or $7.5 million.