Maher in deal with Nova Scotia terminal
A company has entered into a deal with Maher Terminals, the developer that turned the remote British Columbia port of Prince Rupert into a container hub, to build a large new container terminal in Nova Scotia.
Melford International Terminal plans to build a 315-acre container terminal at a greenfield site on the Strait of Canso — the waterway that divides Cape Breton Island from the rest of the Nova Scotia Peninsula.
Melford said Wednesday that Maher will become a shareholder and operate what would be called the Maher Melford Terminal. It did not reveal anything about the financial relationship between the two companies.
Maher operates a 445-acre container terminal in Elizabeth, N.J., the largest in the Port of New York and New Jersey. It is also developed the Fairview Container Terminal in Prince Rupert, which opened in 2007.
The terminal at Prince Rupert, considered visionary by many in the shipping industry, was conceived of and largely constructed when Maher was a family-owned company. Maher was sold, also in 2007, to RREEF Infrastructure, part of the global alternatives asset management business of Deutsche Bank's Asset Management division.
Melford President Paul Martin said the Nova Scotia terminal would “in many ways be an East Coast version of Prince Rupert.'
'We could not have a better partner than Maher to establish the Maher Melford Terminal as a strategic gateway for cargo moving between Asia and North America,” he said. “Maher's most recent experience in container terminal development at Maher's Fairview Terminal in Prince Rupert, which opened in 2007, provides an invaluable benefit for the development and commercialization of Maher Melford Terminal.'
Melford, a privately owned Nova Scotia company, said that in addition to the container terminal, it plans to include a intermodal on-dock rail facility and a 1,500-acre logistics park on the mainland side of the Strait of Canso. The terminal would have deepwater berths of 60 feet, an ice-free 100-foot deep channel and no air draft restrictions, the company said.
The terminal site is close to Port Hawkesbury, which is Canada’s second-largest port in terms of tonnage after Vancouver by dint of a large crude oil transshipment terminal. It also handles aggregate, gypsum, and pulp and paper.
As with Prince Rupert, the Nova Scotia terminal would be located in a remote, northern part of Canada and be almost entirely reliant on cargo bound for or originating from distant customers in Canada or the United States.
Melford International Terminal is a privately held developer, the owners of which include a partnership of Nova Scotia businessmen as well as Cyrus Capital Partners L.P. of the United States and United Kingdom. The Nova Scotia owners as well as Cyrus Capital Partners will continue to play an active role in the development of Maher Melford Terminal, Melford said.
Richie Mann, vice president of marketing for Melford, said the company was not revealing the financial deals behind the arrangement with Maher, but he said the Maher would operate the terminal “and will be with us every step of the way from here on.”
Mann said the company has purchase and sale agreements for the property, permits, and substantial terminal design work is completed, and construction design work is ready to hand off to an engineering procurement and construction firm.
“The one area that has to be finalized before we start construction is the financial package, but we are well along in that as well, we have some strong advisors and partners — Cyrus Capital Partners, Bank of Montreal, and others that we will probably be disclosing in the not too distant future.”
He said about $350 million is needed for the first stage of the project, including a 20-mile rail spur that would connect to a short line now owned by Rail America, that connects to Canadian National Railway in Truro, Nova Scotia. He said it is likely CN locomotives would move trains directly to the container terminal in Melford.
“Maher is a huge benefit to us in giving the project credibility,” he said. The port has not yet attracted any firm commitments from container carriers to use the terminal.
“We certainly will want to have a line, and having a line will make it easier to finance,” he said. But he said the board of the company will make a decision on whether to move ahead with construction without firm cargo commitments.
Construction of the facility and rail line would require two full construction seasons, he said, and Melford hopes to open the new terminal in early 2013.
He said that fact that the terminal is in a greenfield location, that no labor union has jurisdiction over the site, and that there is no public port authority involvement means “we are able to do a lot of things probably no container terminal in North America can do in terms of unique partnerships, equity partnerships, in terms of utilizing technology and automation.”
The terminal plans to target shippers moving cargo from and to Asia, west of Singapore.
“One of the things that is attractive to Maher is that if they have customers who want or can use both coasts, they can offer quality service from both coasts,' Mann said.
The company’s marketing plan envisions about one-third of the cargo moving through the terminal to be bound to the U.S. Midwest through Chicago, one-third to the Ohio Valley, and one-third to Atlantic and Central Canada. ' Chris Dupin
