TasPorts 2043

A 30 YEAR PLAN to guide state wide port development for the benefit of industry

WHY did we
develop a
thirty-year
plan?

Why are we developing a ports strategy in Tasmania?

With more than 99% of freight volumes moving in and out of Tasmania by sea, ports are an incredibly important part of our transport system.

As markets change, the development of our ports is key to meet future freight demand. We have devised a clear plan to make sure any long-term developments that take place achieve the best value for our customers and broader industry.

Our objective is to provide economically sustainable ports to service the diverse needs of Tasmanian industry over the next 30 years. This is how we’re going to do it.

What does it look like now?

What does the current ports system look like?

There are four major ports

  • Burnie
  • Devonport
  • Bell Bay (including Longreach)
  • Hobart (Macquarie Wharves, Risdon and Selfs Point)

There are also four major community asset sites

  • (Hobart) Sullivans Cove
  • Inspection Head
  • Strahan
  • Stanley

Tasports also manages cargo outports and community use infrastructure on King Island and Flinders Island.

Tasports also provides marine services to “private ports” such as Port Latta.

Current infrastructure

TasPorts also provides community use infrastructure in Sullivans Cove, Inspection Head, Strahan and Stanley, along with commercial and community use ports on King Island and Flinders Island.

TasPorts also provides marine services to “private ports” such as Port Latta.

Over recent years, there has been an overwhelming freight shift towards the three northern ports (Bell Bay, Burnie and Devonport). These ports now handle the majority of imports and exports for Tasmania.

Because of this, the focus of our 30 year port plan will be the long term outlook for these three major ports with the addition of Hobart.

WHAT DO WE WANT TO ACHIEVE?

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Our objective is to provide economically sustainable ports to service Tasmania's diverse freight needs over the next 30 years.

We want to:

  • Meet customer expectations
  • Optimise port utilisation whilst continuing to cater for freight demand
  • Reduce infrastructure duplication without limiting growth potential
  • Minimise supply chain costs for industry
  • Meet financial expectations (upfront capital & operational expenditure) of our shareholder
Who was involved?

Who was involved?

The following organisations, groups and government bodies played a role in developing best practice methodology and ensuring data accuracy of the plan:

  • Key customers
  • Tasmanian Industries
  • Department of State Growth
  • Department of Treasury and Finance

The foundation for the Plan is based upon the Council of Australian Governments (COAG) recognition that ports and related inland supply chains are critical to the continued competitiveness of Australian industries. COAG identified long term planning as a key platform in removing barriers to trade, reducing transaction costs, improving competition and contestability and consolidating efficient linkages to domestica and global value chains.

Following this, Tasports undertook key customer and market consultation to support the development of a Plan for Tasmania.

How did
we develop
our plan?

We developed and considered multiple scenarios in order to draw conclusions about the best way forward.

Some of the factors that were considered were:

  • Emergence of new industries
  • Evolution of supply chains
  • Urban encroachment
  • Climate change
  • Restriction on capital dredging
  • Restriction on maintenance dredging
  • Desire for local benefits
  • Risk management of port activities
Our discoveries

We analysed each scenario using the following framework:


Through this analysis we discovered the following key facts:

Freight volumes in 2043 will be only marginally higher than those recorded in 2008.

The total import and export freight through the Tasmanian ports in 2012/13 was 11 million tonnes. This is forecast to grow by 54% to 17 million tonnes per annum by 2043. Although this appears to be a significant increase, this volume is only marginally higher than the 2007/08 financial year, which saw 16.2 million tonnes through the ports. This tells us that our current port system already has the capacity to service the forecast freight volumes of 2043.

Agriculture will be the driver of import & export.

While all commodity types are expected to experience at least some growth over the next 30 years, agriculture and agricultural products are expected to be a key growth sector, with an import growth of 40% forecast between now and 2043.

There is no forecast change in vessel size.

The factors that influence ship size are typically the small cargo parcel sizes, diversity of commodity and the requirement for low supply-chain costs, which rely on the proximity of major industries to ports that often serve as ‘natural gateways’. As these factors are expected to remain relatively unchanged over the next 30 years, the future size and configuration of vessels will not impact the port strategy.

From here, we were able to consider four primary port strategies.

  • A brand new port development at a new location
  • Creation of a new port in an existing port location
  • A single northern port plus Hobart
  • A Multi-Port System

Key Considerations

Our key considerations in assessing the alternative strategies included:

  • Investment in ports and facilities as they currently stand
  • Investment required to meet future demand
  • Under-utilised capacity in the current ports system
  • Forecast freight demand over the life of the plan
  • Potential cost impacts to customers

Key considerations

Using the following key considerations, we explored each strategy option and came up with a list of advantages and disadvantages for each.

We determined the viability of each strategy by considering:

  • Sunk investment
  • Infrastructure investment to meet demand
  • Current latent capacity
  • Forecast demand
  • Supply chain value

Here’s our assessment of each strategy.

Expansion of a new port in an existing location

Under this option, an existing port  and location would be expanded to create one port for the State.
Advantages / Disadvantages

Multi-port system

This option proposes that ports will operate across the state from existing locations and will cater to key primary and secondary modes of commodity types.
Advantages / Disadvantages

Brand New Port

Under this option, TasPorts could construct a brand new port to facilitate all sea-based trade in Tasmania.

Advantages / Disadvantages

A single Northern Port plus Hobart

This option assumes that the port of Hobart would remain and the three northern ports would be consolidated to a single port.

Advantages / Disadvantages

Brand New Port

Under this option, TasPorts would construct a brand new port to facilitate all sea-based trade for Tasmania.

Advantages

  • Capability to handle larger vessels (if necessary)
  • Modernised infrastructure
  • Operating cost synergies

Disadvantages

  • A suitable location for the port is yet to be identified that would support the majority of commodities
  • It would require extensive road and rail extensions to the new location, and such a development would involve a significant cost
  • It would have a disruptive impact on regional port activities
  • Any savings in supply chain or operational costs would be offset by the significant upfront costs ($ billions)
  • Some logistics companies would incur higher landside transportation costs as a result of relocating their operations, potentially making business unsustainable
  • Hobart and the three northern ports would close, resulting in wasted infrastructure

Creation of a new port in an existing port location

Under this option, a new port could be created in an existing location to create one port for the State.

Advantages

  • Potential to handle larger vessels (if necessary)
  • Operating cost synergies

Disadvantages

  • This port would require all-weather deep water access, as well as considerable landside facilities to accommodate the volume of trade in one location. These requirements will exclude Bell Bay, Devonport and Hobart as possible locations, as they are all geographically unable to provide such requirements.
  • Three ports would close, resulting in wasted infrastructure
  • Any savings in supply chain or operational costs would be offset by the significant upfront costs ($ billions)
  • Some logistics companies would incur higher landside transportation costs as a result of relocating their operations, potentially making business unsustainable
  • Factors such as proximity to urban encroachment, road width at the port entrance and need for a large turning circle mean that an increase in road traffic from the port would create substantial issues

A Single Northern Port plus Hobart

This option assumes that the port of Hobart will remain as a port and the three northern ports would be consolidated to a single port.

Advantages

  • Hobart would continue to play to its strategic strengths of tourism and Antarctic support, as a preferred port for cruise vessels and home to the Australian Antarctic Division
  • Burnie or Bell Bay would be able to accommodate the forecast container volume
  • Operating cost synergies

Disadvantages

  • Any savings in supply chain or operational costs would be offset by the significant upfront costs ($ billions)
  • There’s the potential to disrupt the ‘natural’ commodity gateways, which would then cause substantial logistic cost impacts
  • Port infrastructure consolidation is problematic and costly
  • Some logistics companies would incur higher landside transportation costs as a result of relocating their operations, potentially making business unsustainable

A Multi-Port System

This option proposes that ports will operate across the state from the existing locations and will cater to key primary and secondary modes or commodity types.

Advantages

  • Using existing port infrastructure means lower upfront costs
  • As the growth in freight is forecast to be low, the port system will only require incremental infrastructure and capacity development, minimising significant upfront costs and long development lead times
  • This system already has the capacity to meet the forecast freight volume of 2043
  • It will capitalise on existing assets and use them to their full capacity
  • The multi-port system has the ability to manage diverse product groups through natural ‘gateways’
  • It allows for commodity-driven port specialisation, making it demand led and adaptable to forecast market changes
  • Duplication of infrastructure will be reduced, increasing efficiency and reducing costs
  • We will be able to continue to take advantage of existing regional economic strategies and benefits
  • Freight services will be protected in the case of port emergencies

Disadvantages

  • Multiple port locations
  • The need for a more complex supply infrastructure
  • There’s the potential to increase costs for some product sectors
  • Port costs may increase

Our Plan

After weighing up the pros and cons,  the best way forward for the future of Tasmania’s ports is the evolution of our current port system to create a multi-port system with defined roles.
Why a multi-port system?

Why a Multi-port system?

  • This option recognises that there is both a diverse range of commodity types and ways to transport them, and gives us the opportunity to develop specialised ports
  • It already has the capacity to service the forecast freight growth in 2043, meaning the current ‘sunk investment’ in infrastructure and capacity at the major ports will not go to waste
  • The geographic spread of imports and exports will be accommodated via existing natural gateways, which means we won’t need to invest in significant changes to the major landside road and rail networks
  • It most closely aligns with our vision to provide economically sustainable ports to service the diverse needs of Tasmania over the next 30 years

The key benefits are:

  • Demand led
  • Cost synergies
  • Reduced infrastructure duplication
  • Flexibility
  • Supporting gateway industries

How will a multi-port system work?

Three types of ports

Over the next 30 years, Tasmania's ports will be required to import and export a diverse range of commodities, and continue to serve the needs of the community. To respond to a variety of different needs, we'll have a variety of different ports.

To suit a range of purposes

Under our multi-port system, each port will service the specific needs of its region. For example, if a commodity exists near a particular port, that port will act as a gateway for that commodity. This will mean our port system directly responds to the needs of Tasmania.

Antarctic

Cement

Community

Containers

Cruise Ships

Minerals

Forestry

Metals

Tourism

Fishing

The Major Ports in Tasmania's
Multi-Port System

Port Location Primary Uses General Uses

Hobart
Cruise
Antarctic
Fuel import/export
General cargo import/export
Forestry

Devonport
Cement import/export
Container import/export
Passenger Ferries
Fuel import/export
General cargo import/export

Burnie
Container import/export
Forestry
Minerals
Cruise
Fuel import/export
General cargo import/export

Bell Bay
Forestry
Metals
Containers
Fuel import/export
General cargo import/export

The Bass Strait Ports in Tasmania's
Multi-Port System

Port Location Primary Uses

King Island
Livestock cargo
Fuel import/export
General cargo import/export

Flinders Island
Livestock cargo
Fuel import/export
General cargo import/export

The Community Ports in Tasmania's Multi-Port System

Port Location Primary Uses

Sullivans Cove
Community Asset
Fishing
Tourism

Stanley
Community Asset
Livestock Cargo
Fishing

Inspection Head
Community Asset
Fishing

Strahan
Community Asset
Tourism
Fishing
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    Bell Bay


    forestry metals

    Bell Bay will primarily handle basic metals and forestry with capacity to expand around minerals and fuels growth projects.

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    Hobart


    antarctica cruiseship forestry

    Hobart remains the “home” of Cruise and Antarctic logistics operations in the State.

    Additional commodities such as forestry and general cargo can be supported.

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    Burnie


    containers dry bulk cruiseship

    Burnie will primarily handle consumer goods (RORO vessels for containers and trailers), dry bulk minerals and forestry.

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    Devonport


    tourism cement containers

    Devonport will primarily handle short-sea passenger tourism, cement and consumer goods (RORO vessels for containers and trailers).

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    Grassy


    Grassy will remain a cargo port.

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    Lady Barron


    Lady Barron will remain a cargo port.

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    Inspection Head


    Inspection Head will remain a community asset.

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    Stanley


    Stanley will remain a community asset.

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    Strahan


    Strahan will remain a community asset.

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    Currie


    Currie will remain a community asset.

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    Sullivans Cove


    Sullivans Cove will remain a community asset.

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Further Information

For more information on Tasports please visit tasports.com.au