Each year over the last five fi­nan­cial years the Port Au­thor­i­ty of T&T (PATT) record­ed mul­ti-mil­lion dol­lar net deficits.

And when you com­bine those five net deficits, the over­all loss made by PATT was over $337.5 mil­lion.

This to­tal loss, how­ev­er, still does not give a prop­er over­all pic­ture of the fi­nan­cial dif­fi­cul­ties fac­ing PATT, as it does not take in­to ac­count the fi­nan­cial dif­fi­cul­ties ex­pe­ri­enced by PATT’s three strate­gic busi­ness units (the Port of Port-of-Spain, the Port-of-Spain In­fra­struc­ture Com­pa­ny, and the T&T In­ter-Is­land Trans­porta­tion Com­pa­ny) as well as the op­er­a­tions at the Port of Scar­bor­ough that falls un­der its purview.

“PATT and its three (3) SBUs, in­clu­sive of the POSCA (Port of Scar­bor­ough), have been in a deficit po­si­tion for many years with gov­ern­ment sub­ven­tions com­plete­ly fund­ing the In­ter-Is­land Fer­ry Ser­vice and cap­i­tal ex­pen­di­ture be­ing re­quest­ed an­nu­al­ly through the Pub­lic Sec­tor In­vest­ment Pro­gramme (PSIP) for equip­ment and in­fra­struc­ture up­grades, how­ev­er, the lat­ter is usu­al­ly se­vere­ly un­der-fund­ed,” PATT stat­ed.

“Fur­ther­more, PATT’s ex­pen­di­ture has con­sis­tent­ly ex­ceed­ed its rev­enues be­cause of out­dat­ed work­ing prac­tices there­by re­sult­ing in high labour costs, as well as aged equip­ment re­sult­ing in sub-stan­dard pro­duc­tiv­i­ty lev­els, and ul­ti­mate­ly, high­er op­er­a­tional costs. PATT is there­fore un­able to in­vest in ma­jor cap­i­tal ex­pen­di­ture. Rev­enue gen­er­a­tion is fur­ther stymied by the PPOS’s in­abil­i­ty to set com­pet­i­tive tar­iffs due to its op­er­a­tional in­ef­fi­cien­cies as well as its lack of in­fra­struc­ture to at­tract ves­sels tran­sit­ing the re­gion,” it stat­ed.

As such the PATT is now of­fer­ing a Re­quest for Ex­pres­sion of In­ter­est for a po­ten­tial pub­lic-pri­vate part­ner­ship project.

“The Gov­ern­ment of the Re­pub­lic of T&T (GoRTT), op­er­at­ing through the PATT, in­vites in­ter­est from will­ing in­vestors with ex­pe­ri­ence in port in­vest­ments, de­vel­op­ment and op­er­a­tions, ship­ping, lo­gis­tics and cruise op­er­a­tions to pro­pose busi­ness ideas that will sup­port par­tic­i­pa­tion in a PPP Land­lord mod­el project with the PATT, in any or all of the fol­low­ing ar­eas:

a) The car­go op­er­a­tions at PPOS;

b) The car­go and cruise op­er­a­tions at the POSCA;

c) Re­gion­al car­go ac­tiv­i­ties at Cari­com wharves;

d) Cruise ship­ping op­er­a­tions at PATT

Apart from this PATT stat­ed po­ten­tial in­vestors may al­so con­sid­er op­por­tu­ni­ties in ma­rine ser­vices (towage, dredg­ing etc).

“The PATT recog­nis­es that an ef­fec­tive pub­lic-pri­vate agree­ment has the po­ten­tial to not on­ly gen­er­ate rev­enue but al­so pos­i­tive­ly en­hance the ex­pe­ri­ence of Port users, busi­ness­es and the na­tion­al com­mu­ni­ty. This Ex­pres­sion of In­ter­est (EOI) is en­cour­ag­ing and cre­at­ing the com­pet­i­tive en­vi­ron­ment for new agree­ment(s) to be cre­at­ed. This EOI is de­signed to give all who may be in­ter­est­ed an op­por­tu­ni­ty to pos­si­bly en­gage in a po­ten­tial pub­lic-pri­vate part­ner­ship arrange­ment in the fu­ture,” it stat­ed.

PATT was in­cor­po­rat­ed by the Port Au­thor­i­ty T&T Act 39 of 1961, cur­rent­ly the Port Au­thor­i­ty Act, Chap­ter 51:01 and op­er­ates as a statu­to­ry au­thor­i­ty un­der the Min­istry of Works and Trans­port.

PATT main­tains an em­ploy­ee com­ple­ment of ap­prox­i­mate­ly 1,516 per­sons and is gov­erned by a Board of Com­mis­sion­ers.

It owns 151.8 hectares of land ex­tend­ing from Beetham High­way in the east to In­vaders Bay in the west.

The port utilis­es 48.41 hectares of its land for its op­er­a­tions. It leas­es 78.04 hectares, with the re­main­ing 25 hectares lo­cat­ed in east Sea Lots. The Port of Scar­bor­ough, To­ba­go op­er­ates on ap­prox­i­mate­ly 3.47 hectares.

It has been tran­si­tion­ing in­to strate­gic busi­ness units since 2005, when PATT took a de­ci­sion to de-cou­ple and break in­to spe­cialised or­gan­i­sa­tions based on func­tion­al­i­ty.

The ob­jec­tive was to al­low each busi­ness unit to be­come au­tonomous and spe­cialise in its core area of op­er­a­tion.

In ad­di­tion to the three SBUs, the Port of Scar­bor­ough (POSCA), To­ba­go, falls with­in the joint purview of the Port Au­thor­i­ty Gov­ern­ing Unit (PATTGU) and the To­ba­go House of As­sem­bly (THA).

Op­er­a­tions at the POSCA, in­clude car­go han­dling and cruise ship­ping, with po­ten­tial for ex­pan­sion in re­gion­al trans­ship­ment as well as in the cruise busi­ness.

“PATT fa­cil­i­tates the ma­jor­i­ty of trade with­in T&T and pro­vides a gate­way to re­gion­al and for­eign mar­kets, be­ing the largest car­go han­dling and cruise ship­ping port in the coun­try. Its mar­ket share is 60 per cent of con­tainer­ised trade in T&T,” it stat­ed.

“How­ev­er, with the ex­pan­sion of the Pana­ma Canal, PPOS has lost trans­ship­ment car­go to re­gion­al ports which have in­vest­ed heav­i­ly in in­fra­struc­tur­al and equip­ment up­grades, to cap­i­talise on the trade be­ing trans­port­ed by the larg­er ves­sels tran­sit­ing the canal,” PATT stat­ed.

The ex­pan­sion of the Pana­ma Canal in 2014 has re­sult­ed in a struc­tur­al change in the size of ves­sels, with ship­ping lines amal­ga­mat­ing car­goes and con­tain­ers on­to larg­er 20-foot equiv­a­lent units (TEUs) ves­sels (new Pana­max 8,000 to 10,000 TEUs ves­sels), which may in­crease to 11,000 and 13,000 TEUs.

“As a re­sult, ma­jor ports in the re­gion have and con­tin­ue to make sig­nif­i­cant in­vest­ments in­to in­fra­struc­ture and equip­ment, to ac­com­mo­date the new Pana­max size ves­sels and to re­main com­pet­i­tive,” it stat­ed.

The largest ves­sel to call at the Port of Port-of-Spain (PPOS) is 295 me­ters, with a draft of 12 me­ters and a con­tain­er ca­pac­i­ty of 5000 TEUs. “Un­for­tu­nate­ly, the in­fra­struc­ture and chan­nel at PPOS can­not ac­com­mo­date the longer and deep­er draft ves­sels. Sim­i­lar­ly, the in­fra­struc­ture and draft lim­i­ta­tions al­so re­strict the abil­i­ty of PATT to ac­com­mo­date large cruise ships tran­sit­ing the re­gion,” it stat­ed.

“Fur­ther­more, in terms of the ex­ist­ing in­fra­struc­ture, the quay wall is al­ready at max­i­mum depth, ex­cept for berth 7, which can be deep­ened from 12 me­tres to 14 me­ters. How­ev­er, berth 7 is on­ly 197 me­ters long and PPOS will need to ac­com­mo­date ves­sels with lengths over 300 me­ters. As a re­sult, pri­or­i­ty has been giv­en to the con­struc­tion of berths 9 & 10 to ac­com­mo­date the larg­er ves­sels. In ad­di­tion, up­on com­ple­tion, they will pro­vide al­ter­nate berths as nec­es­sary to fa­cil­i­tate up­grade de­vel­op­ment at the oth­er berths with­out sig­nif­i­cant in­ter­rup­tion of ves­sel move­ment,” it stat­ed.

Ac­cord­ing to PATT most of the equip­ment at the Port of Port-of-Spain is “be­yond its eco­nom­ic life and neg­a­tive­ly af­fects the abil­i­ty to han­dle ves­sels tran­sit­ing with high car­go (tran­ship­ment and do­mes­tic) vol­umes, at com­pet­i­tive pro­duc­tiv­i­ty lev­els, there­by lim­it­ing its rev­enue gen­er­a­tion po­ten­tial.”

The PPOS con­tributes over 75 per cent of the to­tal rev­enue of PATT and by ex­ten­sion is ap­por­tioned the high­est share of the over­head cost be­ing ap­prox­i­mate­ly 60 per cent of PATT’s over­heads, which de­pletes its op­er­at­ing mar­gin.

The high­est rev­enue stream for PPOS is earned from the Car­go Han­dling busi­ness.

The gross prof­it mar­gin of PPOS has been fair­ly con­sis­tent at 20 per cent over the pe­ri­od pre­sent­ed ex­cept for FY 2020 which ex­pe­ri­enced a sharp de­cline of 14 per cent in rev­enue earned dur­ing that fi­nan­cial year as a re­sult of six per cent de­crease in ves­sel calls and a 13 per cent de­crease in car­go through­put.

POS­IN­CO is re­spon­si­ble for the re­al es­tate, equip­ment, plant, build­ings and oth­er non-re­al prop­er­ty, rights and oblig­a­tions of the PATT, as well as the Cari­com Wharves re­gion­al car­go ac­tiv­i­ties and cruise ship­ping busi­ness in Port-of-Spain.

“POS­IN­CO plays a key role in fa­cil­i­tat­ing PPOS’s busi­ness due to its re­spon­si­bil­i­ty in main­tain­ing in­fra­struc­ture, and up­grad­ing/ex­pan­sion of same. The lim­i­ta­tions de­scribed above, faced by PPOS rel­a­tive to in­fra­struc­ture, are as a re­sult of POS­IN­CO not hav­ing re­quired Capex which is re­quest­ed an­nu­al­ly via PSIP fund­ing from the gov­ern­ment. POS­IN­CO is 100 per cent re­liant on PSIP for cap­i­tal projects,” it stat­ed.

POS­IN­CO con­tributes 23 per cent of the to­tal rev­enue of PATT and is al­lo­cat­ed its re­spec­tive share of over­heads, with the high­est stream of rev­enue be­ing earned from ves­sel charges.

The de­crease in op­er­at­ing ex­pen­di­ture re­flect­ed in FY 2019 and FY 2020, was di­rect­ly as­so­ci­at­ed with the cost as­so­ci­at­ed with towage charges be­ing trans­ferred to the ac­count of the ship­ping lines with the ex­cep­tion of cruise ships which are treat­ed as per tar­iff charges.

Op­er­a­tions at POSCA in­cludes cruise ship­ping, car­go han­dling op­er­a­tions of bond­ed car­go and lo­cal­ly as­signed car­go.

Present­ly the POSCA’s lands and re­al es­tate are vest­ed in PATT. The THA is charged with the re­spon­si­bil­i­ty of con­struct­ing, main­tain­ing and re­pair­ing stor­age and ware­hous­ing fa­cil­i­ties.

“POSCA is a very small rev­enue earn­er, con­tribut­ing around two per cent to­wards the to­tal rev­enue of PATT. The main rev­enue stream for POSCA em­anates from cruise ship op­er­a­tions, which ac­counts for over 65 per cent of the rev­enue of POSCA. The down­ward trend in rev­enue from FY 2019 is re­flec­tive of the loss­es ex­pe­ri­enced in the Cruise Ship­ping op­er­a­tions,” it stat­ed.

Ac­cord­ing to PATT the ex­pect­ed out­come of the EOI would be to ob­tain in­for­ma­tion from the pri­vate sec­tor in or­der to clar­i­fy the scope of the po­ten­tial PPP Project for the Port, and iden­ti­fy op­por­tu­ni­ties for pri­vate par­tic­i­pa­tion/in­clu­sion in the port sec­tor of T&T.

“The goal of the GoRTT in in­creas­ing pri­vate par­tic­i­pa­tion is to es­tab­lish a more com­pet­i­tive & fi­nan­cial­ly sus­tain­able port sys­tem. Spe­cif­ic ben­e­fits which can be de­rived by the GoRTT: Im­proved lev­el of gov­er­nance in the PPOS’ op­er­a­tions; Im­proved port ac­tiv­i­ties and op­er­a­tional ef­fi­cien­cy which can be pos­i­tive­ly lever­aged to im­prove the ease of do­ing busi­ness in coun­try; Pos­i­tive rev­enues via div­i­dends, con­ces­sions and/or lease pay­ments and tax­es; and stim­u­la­tion of the lo­cal man­u­fac­tur­ing sec­tor,” it stat­ed.