26 November 2014

ICTSI to expand capacity of its Subic terminal

As government hesitates to allow International Container Terminal Services Inc. (ICTSI) to expand its Manila port operations, the company is seeking to expand its container terminal in Subic Bay, whose capacity utilization is increasing, as part of its strategy to “future-proof” its terminals.

Christian Gonzales, vice president and Asia Region head of ICTSI, told reporters in an interview that this is part of its five-year $300 million to $400-million Medium Term Development program.

Initially, the company has allocated $12 million for rubber-tire gantry (RTG) cranes for both Subic New Container Terminal-2 (NCT-2) and Manila International Container Terminal (MICT).

Gonzales said it is not yet certain how many RTGs will go to Subic, which has already six, and MICT as this will depend on market demand.

“We won’t be adding quay cranes in Subic because they have already four.

In Manila, we plan on adding two but that’s over 2 years depending on how we see the market developing,” he said.

Gonzalez noted that ICTSI’s strategy in its strategic expansion planning has always been to “future proof” its terminals. Subic has been designated by the government as alternative to Manila port in light of the ongoing port congestion.

While the additional equipment and capacities may only be a small portion of its overall MTD plan as there is no need to expand the pier but to continue with two berths for the big ships, Gonzales said they may also need to expand the port area in coordination with Subic Bay Metropolitan Authority.

NCT-2 has a total of 13.16 hectare terminal Area; 14-hectare container yard; 280 meters quay; controlling depth of 13 meters; 6 truck lanes; 0.7 hectare truck holding area; and 60 ton weigh bridge.

He noted there are still available lots in Subic that they can expand into.

ICTSI has already discussed this plan with SBMA Chairman and Administrator Roberto Garcia who told them to possibly do it in stages.

“Chairman Garcia is very flexible, very aggressive. We are just making sure that Subic is ready to accommodate more traffic as much as possible,” he said.

According to Gonzalez, the capacity utilization of NCT-2 in Subic is expected to reach 21 percent by next year. NYK shipping line has their first call on Monday.

The government has been against further expansion of the Manila port, but Gonzalez said there has been some softening of government stance as they now allowed the expansion of berth 7.

Gonzalez explained there are two kinds of expansion, one is just expanding capacity to allow bigger but fewer ships to call and making the Manila port operations more efficient. The other type of expansion is where a player just wants to get a bigger market share.

Gonzalez does not want to divulge its market share in the Manila port but said that they understand the government’s move to promote Subic and Batangas.

He, however, stressed that the “promotion for Batangas and Subic should be done by getting industries to move there not by taking the cargo of somebody.”

Gonzalez even said that the shift of cargoes from the MICT to Subic following the port congestion and the designation of Subic and Batangas as alternative to Manila ports has been very small and just temporary.

Those that shifted permanently are those that are really from the nearby areas.

“It does not mean that while you have the port, the cargo volume will go to you,” he stressed. (Bernie Magkilat, Manila Bulletin)