January 27, 2008
Calling Jafza project ‘big time,’ SCSPA official says it points to need for port expansion
A South Carolina State Ports Authority official says Jafza International’s plans to build an logistics, manufacturing and distribution hub in Orangeburg County has further emphasized the need for the Port of Charleston to continue to upgrade and expand its Charleston facilities.
“We are very excited about what that will mean for the port as well as this region,” South Carolina State Ports Authority public relations director Byron Miller told a handful of business and county elected officials at the Orangeburg County Development Commission’s annual board retreat luncheon at the Tourville Lodge Thursday afternoon.
“They are interested in our success. The port expansion of the Navy base is going to be absolutely essential for these projects to continue to move forward. If the port doesn’t grow, these type of projects don’t really have the impact. It is vital we expand. We are aware of it and think it is a great opportunity.”
Jafza, a subsidiary of Dubai World, says it plans to invest $600-700 million in the area to build a logistics, manufacturing and distribution hub that could employ between 8,000 and 10,000. The project is expected to attract about $1.2 billion in private investment. Construction could begin in late 2009.
Earlier this week Applied Technology and Management Inc. announced it would provide program management and development support services for the first phase of the 1,300-acre logistics center. ATM, which is based in Florida, has its largest office in Charleston.
While not getting into details about the nature of the discussions, Miller said the SCSPA’s president and chief executive officer, Bernard Groseclose, has been in close contact with Jafza leadership throughout the company’s interest in the state and Orangeburg County.
“The port plays a key role in international trade and we appreciate them reaching out to us,” Miller said. “As this moves ahead and additional companies locate in South Carolina, in Orangeburg. We need to be ready to serve their needs.”
During a brief question-and-answer session, a question was asked about the Port of Charleston’s relationship and connection with the Jafza project.
“A project of what they are talking about and that name and the significance of this, if this were happening in Chicago or Atlanta, it would be a very big story,” Miller said. “It is happening in Orangeburg, it is happening in South Carolina. This is one of the biggest and the best in the world.”
Miller said there are a number of companies interested in and looking at developing distribution parks ... in and around Charleston, in and around this area and all across the state.”
He says industrial parks like the Jafza project are critical to the port in that there are about 700 companies on a daily basis and 1,400 on a less frequent basis that use the port. An inland distribution center would be important for such companies.
“They rely on international suppliers and buyers and they are shipping products through the port,” he said. “That is why there is a need for port expansion.”
Orangeburg County Development Commission Executive Director Gregg Robinson acknowledged the Dubai World Group’s Jafza International’s announcement to invest in Orangeburg would have to be considered one of the biggest announcements not only for South Carolina but for the Southeast.
“One thing that makes it exciting is that all this global logistics attention is making us focus on what we know we need to do,” he said, noting that the county will make it a priority to develop infrastructure, land development and the building of parks.
Miller said Jafza’s plans are not the only thing that points to a need for the port to conduct a multimillion dollar expansion.
The other is the projected continued stress on a port that has seen cargo volume double over the past decade with about 2 million 20-foot equivalent unit containers coming through the port in 2006 alone. Volume over the next 20 years at the Port of Charleston is projected to double.
Trends are for bigger ships that are no longer constrained by using the Panama Canal but have gone to oceans and the Suez Canal, expanding trade and increasing congestion on the West Coast ports, which will open up opportunities for the Port of Charleston.
As a result, the port has recently placed in service four new container cranes totaling about $10 million each.
The port is also expanding at the site of the former Charleston Navy Base, with the first phase of the project costing about $550 million. The expansion would increase the capacity about 50 percent. The first phase should be completed in about five years.
The research phase of the expansion cost about $5 million and consisted of a 5,000-page study.