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2012 April 26   13:52

Hutchison eyes new Melbourne terminal project

Hutchison Port Holdings, the world's largest container port operator, is likely to encounter competition as it seeks to win control of a proposed stevedoring terminal in Melbourne, reported The Australian Financial Review.

The Victorian government announced it would open a tender mid-year to operate a new terminal at Webb Dock.

At present containers are handled by either DP World or Asciano's subsidiary Patrick Stevedores at Swanson Dock.

Hong Kong billionaire Li Ka-shing's Hutchison entered the Australian market only recently and operates out of Sydney and Brisbane. It has been touted as the most likely third stevedore for Melbourne.

In a statement, the company's Australasian and North Asia managing director Raymond Law confirmed Hutchison would be "interested" in the project.

The winning bidder will have to spend hundreds of millions of dollars establishing the terminal and Law said the project would provide the impetus for considerable economic activity in Victoria.

"We believe developing Webb Dock is central to delivering a much-needed expansion of the port's container handling capacity in the near term," Law said. "The project will also bring additional competition and enhanced productivity to the port and HPH looks forward to finding out full details of the government's plan and the opportunity to become involved in Melbourne's growing ports sector."

But well-placed sources suggest Hutchison could face competition from other stevedores such as shipping giant Maersk's subsidiary APM Terminals, Filipino-based Anglo Ports and PSA Singapore.
The government also indicated that, despite the desire for greater competition, DP World and Patrick would not be precluded from bidding.

One key issue is access to the dock, which is serviced only by road. The government has said a bias will be applied in favouring bids that keep trucks off the nearby and already congested West Gate Bridge at peak hours.

Shipping Australia chief executive Llew Russell said achieving that goal at a busy 24 hour a day port would be difficult. "It will be tough, but the industry is getting tough and you have got to come up with innovative solutions to meet those challenges."

Russell hoped the process would be hotly contested and said it was not problematic to have the incumbent duopoly bidding for the terminal. "The more in the mix the better. Nobody should be shut out of a tender like that," he said.

A DP World spokesman said the company was keen "to understand the full details behind" the announcement, in particular the government's recognition that a re-development of existing infrastructure is possible "to maximise the effective use of existing latent capacity at Swanson Dock. We will look at all opportunities being made available by the Victorian government," the spokesman said.

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