Volume 11 | Issue 2 | Year 2008

The buffalo bayou has a significant place in Texas history, as the founding place of the city of Houston and also as the site of the final battle for Texas independence. Used for boat navigation in Houston as early as 1839, it was established as the Houston Ship Channel 1914. In 1841, it became known as the Port of Houston, and its significance on the state and national economy has grown with an increase in Asian cargo through its facilities.
The Port of Houston today is a 25-milelong complex of diversified public and private facilities. The port is ranked first in the United States in foreign waterborne tonnage, second in the U.S. in total tonnage, and tenth in the world in total tonnage.

Central to the Port of Houston Authority’s business philosophy is continuous improvement. This extends beyond management technique to the facilities themselves, including every marine terminal in PHA’s portfolio of public wharves. Growth and development have always yielded great business advantage to the port authority.

In 2007, the PHA opened the first phase of the new Bayport Container and Cruise Terminal. This state-of-the-art terminal was designed to ease the pressure on the Barbours Cut Container Terminal that handles the bulk of the port authority’s container business and has helped it capture 67 percent of the containerized cargo in the U.S. Gulf of Mexico and 94 percent of the containers moving through Texas.

Voters recently approved a $250 million bond proposal for port improvements. Leveraged with operational revenues, the funds allow construction to continue at the Bayport Container and Cruise Terminal. This $1.4 billion development will include seven container ship berths and have a total of 2.3 million 20-foot equivalent unit throughput at
buildout in approximately 15 years. Up to three cruise ship terminals will be built, with the first being completed in 2008.

The next phase of the container terminal’s construction is Wharf 3, followed by Wharf 4 in 2012. The planned intermodal yard, covering about 123 acres, is expected to handle approximately 20 percent of Bayport cargo. It will also open around 2012. The plan calls for an additional 48 acres of container yard to be added in 2008, 50 acres in 2012, and 55 more acres in 2014.

The terminal’s environmental benefits include the preservation of 956 acres of diverse coastal habitat, the creation of 200 acres of new marshland areas, 173 acres of wetlands created or enhanced, and the preservation of a 128-acre buffer zone. Bayport will generate more than 32,000 jobs and add approximately $1.6 billion to the Texas economy through wages and tax revenues.

There is tremendous demand for the PHA’s container facilities and it will continue to grow for many years to come. As an example: About 12 percent of the Port of Houston’s cargo currently comes through the Panama Canal. The $5.25 billion expansion of the Panama Canal to double the capacity of the 50-mile-long canal has been approved by the citizens of Panama. By the time the expansion of the Panama Canal is completed in 2015, Houston’s share of the cargo flowing through there will also have increased.

In fact, over the last year, the PHA’s trade with East Asia has grown by 22 percent. The trend of all-water service from Asia through the Panama Canal to Houston is accelerating.

In contrast to other parts of the country, Houston is still growing and prospering, and the kind of home-foreclosure crisis affecting the rest of the country is not occurring here. Houston continues to benefit from the trend of Americans leaving cold, damp, snowy areas in the north and the east, and moving to places with more temperate climates in the south and west. In addition, the Houston economy is growing at twice the rate of the U.S. as a whole.

The PHA’s planners did not foresee the rapidly changing international trade trends when the new Bayport Container Terminal was envisioned as a facility built in phases over 15 to 20 years as business developed.

Last year, the port authority had some $450 million in capital improvement projects under way and we are projecting another $200 million in 2008. On any given day, 100 different engineering and construction projects are being worked on at the port authority’s public wharves.

The business plan calls for continuous improvement at all of the port authority’s public facilities, not just the containerized cargo-handling terminals. Big investments in the upkeep and maintenance of all of the public facilities are included in the PHA’s capital plan through 2016. The plan includes such projects as dock and fender repair, additional paving and drainage improvements, and paving of an additional four acres at Care Terminal.

As long as the port continues to grow, it will continue to lead the nation in international trade and commerce. For many years, the Port of Houston has been the nation’s leading port in terms of foreign waterborne tonnage and second in overall tonnage.

Each year, more than 7,000 ships and 150,000 barges call at the port and move more than 200 million tons of cargo. Much of the cargo is destined for the more than 150 businesses
along the channel in one of the world’s largest petrochemical complexes.

A recent economic study that looks at the port’s impact concluded that 785,049 jobs throughout Texas are in some way related to ship channel-related businesses. The overall economic impact of the port is nearly $118 billion. By keeping the public wharves well-maintained, the PHA is assuring the port’s economic vitality and prosperity.

H. Thomas Kornegay was appointed Executive Director of the Port of Houston Authority in April, 1992. Before his appointment by the Port Commission, Kornegay served as the Port Authority’s managing director for five years. For information visit www.portofhouston.com

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