Newsome: SC has advantage before harbor deepening

NORTH CHARLESTON, S.C. -- South Carolina State Ports Authority chief Jim Newsome said Thursday that while ports in the Southeast are racing to deepen their channels, Charleston has a competitive advantage in attracting shipping lines in the years before those projects can be completed.

Even so, he said, South Carolina faces huge investment demands totaling $2 billion in harbor improvements and infrastructure.

"Quite simply, in an era of bunker fuel at $700 per ton, lines are not going to face delays to get in and out of harbors to handle cargo and will gravitate to ports that lessen this risk," Newsome said in his annual State of the Ports address.

"Based on the current status and anticipated legal challenges, it is likely that no Southeastern harbor gets deepened before 2017. This is five years from today. Lines cannot wait for this and will have to gravitate to a port like Charleston, which offers a significant draft advantage today," said Newsome, the authority's president and CEO.

Charleston's harbor is already 45 feet and the authority is working on a $300 million project to deepen it to 50 feet to handle larger container ships.

Shipping lines are moving to larger post-Panamax ships that will be able to move through an expanded Panama Canal. The bigger canal is to open in 2015 but Newsome said that larger ships are already in service. They can be handled at Southeast ports, but, because of channel depths, can't get in and out of the harbors around the clock.

By the time the expanded canal is open, there will be about 2,300 of the larger ships in service, he said.

"These lines are going to employ post-Panamax ships now. They are all looking for next year," he said later. "They don't want to wait. Fuel is too expensive and they want to get into a port where they can get in and get out in 15 hours."

Charleston currently is restricted for about two hours a day in handling a ship with a 48-foot draft.

Nearby Savannah is pursuing a $650 million deepening of the Savannah River shipping channel to serve its ports.

"We have four ports within 400 nautical miles, none of which are large cities and all of which compete to serve the same regional markets," he said. "We exist in probably the most competitive port market in the world."

Charleston is also in competition with Wilmington, N.C., and Jacksonville, Fla.

Newsome said South Carolina's ability to grow depends both on a harbor that can handle larger ships without being restricted by tides and on inland infrastructure.

"Our investment demands are huge _ close to $2 billion when considering the investment of both the port and the state in port-related infrastructure," he said.