Houston sets limits on large container ships

Commissioners at the Port of Houston Authority today voted to impose limits on large container ships calling on Houston Ship Channel terminals after petroleum shippers complained that the big ships would threaten export growth.

At a special meeting the Port Commission of the Port of Houston Authority passed a resolution that would limit traffic for large vessels that cause one-way traffic limitations on the key ship channel approach of Galveston Bay to once a week. Those ships could also not arrive and depart from a Port Houston terminal on the same day. Houston Pilots require one-way traffic for ships over 1,096ft.

"We want to make sure that we don't negatively impact the shipping business and cause cargo to go elsewhere," Port Houston Commission chairman Ric Campo said at the meeting. The resolution would provide "some certainty" to the port's energy customers and hopefully allow them to plan for needed future expansions, he said.

The board also voted to fund a new group that would enable industry to share traffic data with Port Houston, the Houston Pilots, and the US Coast Guard, and others.

The Port's container business attracted the attention of energy firms in August 2018, when it began handling larger container ships that caused the channel's pilots to restrict flows to one-way traffic. So far the Port has seen 10 of the ships, with four more expected through July.

Port Houston took action after Enterprise, Kinder Morgan and about a dozen other companies formed a group to press for limits on one-way Houston Ship Channel traffic, including legislative action to ensure two-way traffic. A representative for the group, called the Coalition for a Fair and Open Port, said that the resolution was a welcome first step, but that legislation is still needed.

"It is a step in the right direction but it's only a step at the beginning of the race," coalition executive director Vincent DiCosimo told Argus. "We need to know that there is a permanent solution — two-way traffic codified at the state level still is the acceptable answer to that question." There are active bills in the Texas legislature to compel the Port to ensure two-way traffic.

According to energy firms like Enterprise, the 1,100ft container ships have disrupted ship channel traffic and interrupted their ability to bring tankers through the channel to handle a rising flow of crude and LPG exports. While there have only been 10 of the big ships to date, "You don't wait until the house burns down and then call the fire department," DiCosimo said. "You call at the first spark."

About 71pc of total ship movements through the Houston Ship Channel in 2018 were energy-related, according to data from the Houston Pilots. The lion's share of energy traffic was mid-sized Panamax vessels, with 8,706 transits. However, wider Suezmax vessels made 246 transits, a Ship Channel record, and LPG vessels made 1,974 transits, also a channel record.

Port Houston operates container terminal facilities at Barbours Cut and Bayport. Container ships made 2,077 transits in 2018. The port's container business has grown in tandem with the widening of the Panama Canal, which enabled shorter voyage times and larger ships from Asian manufacturing centers like China.