APM Terminals (APMT) has submitted an unsolicited proposal to the Virginia Port Authority (VPA) to operate all the US east coast Port of Virginia facilities in Hampton Roads and related inland locations.
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As per the proposal, APMT will operate Norfolk International Terminals, Newport News Marine Terminal, Portsmouth Marine Terminal, the Virginia Inland Port in Front Royal and the APM Terminals marine terminal in Portsmouth valued at between $3bn and $4bn.
APMT proposes to operate the facilities under a 48-year concession, after which the company will transfer ownership of its facilities in Portsmouth to the Commonwealth of Virginia.
The company will also pay concession fees, make additional capital investments, and provide a share of the operations’ revenue to the VPA.
APMT president for the Americas region Eric Sisco said," We have operated in the port for over 30 years, and the $540 million we spent to build our Portsmouth facility represents one of the largest private investments ever made in the Commonwealth.
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By GlobalData"Our proposal provides for world class port operations and the lowest cost, best long term solution for the Commonwealth’s goal to make Hampton Roads the premier port facility now and in the future," Sisco said.
At the end of the concession period, the operations and physical assets invested in by APMT will returned to the VPA.
In addition, APMT will take full responsibility for the investment and development of the next phase of Terminals Virginia, which will increase capacity by an estimated 1.2m teu, which equates to more than 60% of the current Port of Virginia total throughput.
In June 2010, AP Moller-Maersk subsidiary APMT agreed to lease its Portsmouth container terminal in Virginia, US, to the VPA for 20 years.
Under the $865m lease contract, the VPA is expected to pay a rent of up to $41m for three years, which could be increased to $44m in 2014-30.
Volume payments for cargo over 500,000 containers a year would increase total payments to APMT to more than $1.1bn over the lease period, Reuters said quoting Lloyd’s List.
APMT said the lease agreement would substantially increase the marketability of the Portsmouth facility and position Virginia to become the leading port on the US East Coast.
Image: Under the proposal, APM will transfer ownership of the port facilities in Portsmouth to the Commonwealth of Virginia after concession period. Photo: APM Terminal
