Ports America makes room for poultry exporter

Ports America makes room for poultry exporter

   Ports America has agreed to relinquish 13.5 acres of leased property at the Port of New Orleans to facilitate the construction of a large cold storage facility for another tenant that requires a Mississippi River terminal location for access to larger vessels.

   The Board of Commissioners on Sept. 9 approved the new location for the 147,000-square foot refrigerated warehouse that will be operated by New Orleans Cold Storage (NOCS), the port said.

   The decision is the latest step in a long process to make the frozen poultry exporter whole again after Hurricane Katrina in 2005 led to the closure of the Mississippi River-Gulf Outlet, a man-made shortcut between the Intracoastal Waterway and the Gulf of Mexico that enabled larger ships to reach its inner harbor site. Only about 40 percent of the ships that previously called the Jourdan Road Terminal can reach that location now through the inner harbor locks.

   NOCS has responded to the reduced ocean transportation by trucking the rest of the frozen poultry shipments 10 miles to other Mississippi River terminals for loading on larger vessels. The state of Louisiana has provided an annual subsidy of about $1 million per year to help defray a large portion of the extra cross-city trucking costs and help the company remain cost competitive.

   The port plans to spend $42 million to build a new dockside warehouse with a blast freezer at the Napoleon Avenue Terminal, which is considered a more suitable site than the downriver Gov. Nicholls Street wharf where officials originally intended to relocate NOCS. Gov. Nicholls, the only available location at the time because all the other terminals had long-term leases in place, is not ideal because it has a narrow footprint that would have required an elongated warehouse rather than one that parallels the wharf, and inhibited expansion, port spokesman Matt Gresham said. There was also some local opposition to the development from residents of the adjacent French Quarter.

   Port officials sought assistance from its tenants and were able to negotiate a deal with Ports America to give back space that includes a breakbulk transit shed and open space normally used to store steel and other commodities.

LaGrange

   'Access to and from the terminal via the port truckway will make for efficient cargo movements and keep truck traffic off neighborhood streets. Thanks to the flexibility of Ports America and New Orleans Cold Storage, we have an agreement that will benefit all parties involved,' said Gary LaGrange, the port's chief executive officer, in a statement.

   NOCS will have two ship berths at its river terminal.

   The state government has already pledged $23.5 million in federal block grants for relocating the refrigerated warehouse, and port officials say they hope to get another $15 million or more from Washington. Congress authorized $75 million in the 2007 Water Resources Development Act to help mitigate the harm to businesses from Katrina and the closure of the Mississippi River Gulf Outlet. The Louisiana congressional delegation, led by Sen. Mary Landrieu, is working to convince lawmakers to actually appropriate the money to help terminals relocate to the Mississippi River or cover the cost of truck transport there.

   The Louisiana Recovery Authority said it is providing the large development block grant to prevent the NOCS from moving to another state and preserve about 568 direct and indirect jobs. The agency will move to speed funding to the port now that a final location has been settled, it said.

   NOCS is not contributing to the project because it already did so to build the Jourdan Road facility in 2003 and has made concessions in its lease agreement. The company operated a cold storage facility next to the pending construction site. However, that warehouse was not on the waterfront and did not give NOCS the ability to load directly onto ships. It relocated to the converted Jourdan Road Terminal in 2003. The dockside refrigerated terminal enabled it to double its export business, according to the port.

   'This new site allows us to keep our business and jobs in Louisiana.    Our capacity and efficiency will be substantially enhanced with this additional facility. That translates into increased jobs and export tonnage for the port,' said NOCS President Mark Blanchard.

   Gresham said the port stands to lose about $1.5 million in revenue from the deal because it is substituting and converting land that was already under lease to Ports America rather than adding revenue by replacing temporary tenants at the Gov. Nicholl's terminal with a permanent one. Ports America's lease payments have been lowered to reflect the reduction in its footprint.

   The project is to be completed in 18 months. Engineering and other work will move ahead while the port attempts to secure the remaining funds it needs, Gresham said. ' Eric Kulisch