By Philip Newswanger
It's official. The Virginia Port Authority and APM Terminals, a subsidiary of Danish-based shipping conglomerate A.P. Moeller, are partners.
The port authority's board of commissioners has approved a lease with APM Terminals calling for Virginia International Terminals Inc., the port authority's non-profit affiliate, to operate APM's Portsmouth terminal for 20 years.
In return, the port authority will pay APM $44 million for the right to operate the terminal and charge fees on handling containers and ships.
According to the 284-page contract, effective July 1, the port authority must pay APM monthly rent based on a scale of containers handled at the terminal.
More than a year has passed since word surfaced that the Virginia Port Authority and APM Terminals were discussing an arrangement.
APM officials conceded the $500 million terminal after VIT locked up 10-year contracts with most of the shipping lines at the port.
APM is responsible for paying real estate and personal property taxes on the property and equipment while VIT pays for the utilities, the contract stipulates.
The shipping and maritime industry is still recovering from the worst plunge in trade in decades due to the financial crisis.
But trade is flowing again, though not at the same level as in 2007 when the port's container unit business was up 6.9 percent, according to figures supplied by the port authority. nib