By Leo Ryan, AJOT

Based on forecasts that the East Coast will experience a sharp increase in container cargo from Asia and the Indian subcontinent via the Suez Canal, a Nova Scotia group with American partners has announced a $300 million project to build a major container terminal in the Strait of Canso.

The ambitious undertaking, which would compete directly with the Port of Halifax, was announced on May 29. Melford International Terminal Inc., part of Halifax-based Trident Holdings Limited made the announcement.

If all goes according to plan, a container terminal with capacity of about 1.5 million teus and a large logistics park at Melford, in Guysborough County, will go on stream by 2010. Construction would begin in 2008 upon completion of the environmental review process.

Proponents of the new terminal are counting on substantial diversions of Asian cargo to the East Coast in the medium to long term due to what they perceive as the inability of West Coast ports to resolve chronic congestion problems.

‘Within the North American gateway environment, we see our main market opportunities as Atlantic Canada, Ontario, Quebec, the Ohio River Valley, west to Chicago, New England and the back door to New York City,’ Hugh Lynch, chairman of Melford International Terminal and Trident Holdings said in an interview.

A recent market assessment and feasibility study by TranSystems Corp. of Norfolk, Virginia identified Melford, facing the Atlantic Ocean, as one of the best sites remaining on the East Coast of North America for a new terminal handling large containerships.

SSA Marine of Seattle, Washington and Melford are jointly conducting market research and working through a due diligence procedure to determine SSA Marine’s potential role as the terminal’s operator. SSA Marine is a leading global cargo terminal operator in North America, South and Central America, South Africa and New Zealand.

‘SSA Marine is excited to be associated with such high quality companies as Melford and CenterPoint Properties,’ said Bob Watters, VP, Director of Business Development of SSA Marine.

CenterPoint Properties of Oak Brook, Illinois, will invest in the Melford site and will be developing a 1,500-acre logistics park adjacent to the container terminal. As the owner and operator of more than 45 million square feet of industrial space (with an emphasis on intermodal and transportation-related projects), CenterPoint is one of the largest real estate developers in the United States.

On the critical railway dimension for shippers, the Cape Breton and Central Nova Scotia shortline, operated by Florida-based RailAmerica, will provide rail service to Melford through a new rail spur from an existing line at Linwood Junction. This will connect at Truro into Canadian National Railway’s continental network.

Observers note that the deepwater Port of Halifax is currently operating at just half capacity (handling just over half a million containers), and could potentially handle four times that amount with relatively little investment, while key US East Coast ports are also improving their infrastructures to meet the demands of growing Asian cargo from over-stretched West Coast ports.

John Vickerman, founding principal of TranSystems, has been involved in preliminary studies at many ports around the world. He is convinced that container cargo growth will exceed capacity at North American ports in the years ahead.

‘The rising tide lifts all the boats,’ he remarked, adding that the market synergies were even strong enough for Melford International Terminal and the Port of Halifax to work together.