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Port of Newcastle pays up, looks ahead

Grain Central, May 14, 2024

A concept image of the proposed Port of Newcastle container port that can now proceed with ongoing penalties being payable to NSW Ports. Image: Port of Newcastle

PORT of Newcastle has paid $13 million in compensation to NSW Ports in a move which is enabling it to move ahead with plans to build a container terminal.

Following an extraordinary meeting, the Port of Newcastle Board voted in favour of paying the amount determined by IPART immediately on receipt of the invoice from NSW Treasury.

The $13M figure is one-off compensation which means the Port of Newcastle is no longer liable to compensate NSW Ports, which owns Port Botany in Sydney, and the deepwater Port Kembla facility to its south, once Newcastle’s volume is competing against Port Botany in container operations.

Port of Newcastle chief executive officer Craig Carmody said with the legislative process now complete, the Port must turn its attention to the NSW Freight Reform Program.

“The door was once closed on Newcastle operating a container terminal; today, the legal and commercial restriction has been lifted, and we now turn our attention to removing the last regulatory/policy obstacle, the deliberately unfair NSW Freight & Ports Policy; then, planning approvals, investment and construction,” Mr Carmody said.

Transport for NSW recently released the Freight Policy Reform Consultation Paper, which states that competition must be encouraged and well balanced.

“That is all Port of Newcastle has ever asked for, the opportunity to compete, and this policy reform must ensure a level playing field and stop trying to pick private company winners.”

“Since Port of Newcastle was privatised in 2014, it became apparent the market in the Port’s catchment did not want their own trade restricted, they wanted their product exported in the most efficient and cost-effective way,” Port of Newcastle’s Board chair Professor Roy Green said.

“While we eagerly await the outcome of the Freight Reform Program, Port of Newcastle will continue its planning for a container terminal, including continuing to grow container trade through the Port’s Multipurpose Terminal, which has current planning approval for 350,000 containers a year.”

Reaching this point in the Port’s history was not done in isolation, after 24 years of advocacy, the Port’s stakeholders and community have been steadfast in their support of constructing and operating a container terminal in Newcastle.

Mr Carmody gave the projects many supporters, particularly independent Member for Lake Macquarie, Greg Piper, who in 2022 introduced legislation that got the ball rolling on freeing Port of Newcastle from paying a per-unit fee to NSW Ports once container volume exceeded a specified cap.

Port of Newcastle’s Newcastle Deepwater Container Terminal is to be located on 90ha at Mayfield, once part of the BHP Steelworks which closed in 1999.

The proposed terminal is expected has the potential to handle considerable amounts of cotton, grain, pulses and meat produced in northern and central NSW which currently heads to export via Port Botany or the Port of Brisbane.

Port of Newcastle is jointly owned by The Infrastructure Fund, including some investments from Australian superannuation funds, and China Merchants Port Holdings Company.

NSW Ports’ shareholders are global fund manager IFM Investors, the Abu Dhabi Investment Authority’s Tawreed Investments, and Australian superannuation funds.

In addition to Port Botany, NSW Ports owns two container terminals in Sydney: Enfield Intermodal Logistics Centre and Cooks River Intermodal Terminal.

 

 

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