31 March 2016
This month, we are taking you to the port of Milford Haven, situated at the west coast of the United Kingdom. The port of Milford Haven is the UK’s largest energy port and biggest port in Wales with world-class, deep-water port facilities and support services. It provides a whole range of services including cargo handling, ferry operations, fish landing and cruise calls. Through some targeted questions, we would like to offer you more insight in the functioning of this interesting port!
ESPO: Can you briefly tell us about the Port of Milford Haven? What are its main characteristics and challenges?
Port of Milford Haven: The Port of Milford Haven was established by an
Act of Parliament and has a statutory responsibility governed by its Acts to
maintain and improve navigation and the provision of port and harbour services
and facilities.
It is a Trust Port - an independent, commercially run
organisation financing its operations and investments out of retained earnings
and, when necessary and prudent to do so, by securing additional finance from
conventional lenders. It does not have shareholders, nor is it owned by the UK
Government, the Crown or any other entity.
In accordance with the guidance set out by government
for all Trust Ports, the Port of Milford Haven retains its profits to
support the long term viability of the port for future generations.
Additionally, the Port regularly provides significant financial and in-kind
support to a wide variety of local projects, charities, clubs and third sector
organisations as part of its stakeholder benefit.
In addition to its marine function, the Port of
Milford Haven also owns Pembroke Port and Milford Marina and Fish Docks where it
manages an extensive property portfolio. Activities such as cargo
handling, ferry operations, fish landing and cruise calls as well as a first
class marina are spread across these two sites.
Our biggest challenge is to diversify away from over-reliance on fossil fuels,
especially given the Port’s remoteness from the UK’s main population
centres.
ESPO: The Port of Milford Haven is the UK’s largest energy port. Is the Port of Milford Haven developing a strategy to respond to new challenges in the field of energy, such as an alternative energy mix, energy efficiency and enhancing energy independence?
Port of
Milford Haven: The Port of Milford Haven is the UK’s largest
energy port and the biggest port in Wales with world-class, deep-water port
facilities and support services. The
Port, in terms of its marine operation, is almost exclusively focused on
handling bulk liquids such as petroleum products and Liquefied Natural Gas
(LNG). It hosts some of Wales’ most
important employers in the energy sector - Valero, South Hook LNG,
SEMLogistics, Puma Energy, Dragon LNG and RWE
- which, when combined, account for 20% of the UK’s imported energy,
particularly gas.
The UK is seeking to diversify its energy supplies. This creates a level of uncertainty in relation to what will be the long term sources of energy for the UK. This, coupled with substantial fluctuations in the pricing of energy in different international markets, will continue to have an impact on the Port’s business. The Port has no influence on these global shifts in the sources and pricing of different forms of energy. Therefore, we are pursuing a diversification strategy to develop other profitable income streams at our sites in Pembroke Port and Milford Dock. Growth in these areas, where we have greater control, will ensure that we maintain a strong balance sheet and an ability to invest for the long-term, maintaining Port infrastructure for future generations.
In April 2014, the Port invested in renewable energy
with a 20,000 panel solar array being erected on Port-owned land and 26
commercial roof-mounted arrays placed across the Port’s property
portfolio. This resulted in the Port becoming
Carbon Neutral in terms of its own operations and is a key demonstration of our
commitment to the long term future of renewable energy and sustainable
industry.
Pembroke Port has huge potential to be a core hub for the developing marine-renewables industry. Its location on the coast of West Wales means that it is close to unrivalled natural resource for both wave and tide and the cluster of engineering companies nearby, who have grown up servicing the oil and gas sector, make it an ideal location for the test, manufacture, deployment and maintenance of a range of renewable energy devices. The Port of Milford Haven is working collaboratively as a supply chain partner with a number of businesses in this exciting field.
ESPO: How does the port assess the future potential of LNG for the United Kingdom? Is the port currently involved in any LNG related projects?
Port of
Milford Haven: The UK has multiple sources of gas, both from
pipeline and LNG, and therefore is a relatively competitive and flexible
market. However, other countries have
little or no alternative gas supplies and can therefore often command a higher
price. In the past these markets have reacted
to international events, such as the shutdown of nuclear power generation in
Japan, and this has an influence over the number of LNG shipments to the UK,
which ultimately results in huge fluctuations in the Port’s income. We have
seen some recovery in 2015 of the volumes of LNG shipments into Milford Haven
but market pricing creates such uncertainty that diversification is a key focus
for us. The Port is currently not involved
in any LNG-related projects but we will always be ready to serve future
opportunities should they arise.
ESPO: The Port of Milford Haven conducts both cruise and ferry operations. Could you briefly describe the importance of the cruise and ferry business to your port? What are the main challenges?
Port of Milford Haven: The Port hosts a small number of cruise ships each year. We do not currently have an alongside berth for cruise ships which means that most of the larger visiting vessels have to anchor and tender their passengers ashore. Whilst we are happy to host cruise ships, they are a greater significance to the wider community, with passengers and crew making a positive contribution to the local economy when visiting places of interest.
At our site in Pembroke Dock, the Ferry Terminal is
home to South Wales’ busiest route to Ireland, operated by Irish Ferries. From here there are twice-daily sailings to
Rosslare carrying both passengers and freight.
We see further opportunities within this sector and are keen to develop
additional linkages from South Wales to other parts of Europe.
ESPO: The Port of Milford Haven is a trust port. Could you briefly explain this port governance model?
Port of Milford Haven: The Port of Milford Haven was established by an Act of Parliament and has a statutory responsibility governed by its Acts to maintain and improve navigation and the provision of port and harbour services and facilities.
It is governed by an Independent Board of Directors
who determine and oversee the implementation of the Port’s strategy. In addition, the Board is ultimately
responsible for the operational performance, including safety performance, of
the Port.
The 2002 Act specifies that the Board shall comprise
of the Chairman, the Chief Executive, between six to eight other non-executive
members and up to two other executive members. The Chairman is appointed by the
Secretary of State for Transport after an open, competitive selection process.
All other non-executive Board members are appointed by the Board itself through
a similarly open process.
ESPO: On 23 June, the United Kingdom will organise a referendum on whether Britain should remain in the European Union. Would a withdrawal from the European Union affect your port? What would be the benefits and/or advantages of Brexit for your port?
Port of
Milford Haven: We currently see no direct potential benefit or
dis-benefit from a Brexit, however maintaining a stable regulatory framework is
important for our customers who operate to the highest standards of safety and
operational effectiveness whilst minimising environmental impacts.
ESPO: Could you briefly describe the main investment projects in your port for the upcoming years? Could you briefly describe the importance of these investment projects for the port and the city?
Port of Milford Haven: Investment in three new pilot boats – The Port has recently invested £3.6m in the build of 3 new pilot boats to strengthen the reliability of its marine operation. Local fabricators Mainstay Marine Solutions won the contract to build all three boats and they are on track to deliver them on time and within budget. Mainstay Marine Solutions are also key partners in the development of the strategic direction for Pembroke Port. The delivery of 3 new vessels in such quick succession will result in the complete renewal of the Port’s entire fleet. The new, modern boats will have state-of-the-art technology on board, and being identical in design means they will also have complete interchangeability of parts which will provides us and our customers with the reliability required to operate a 24/7 port.
Milford Dock Master Plan – Our diversification
strategy involves generating greater financial contributions from our other
assets, in areas that are unconnected to oil and gas. The Port of Milford Haven holds an extensive
property portfolio in Milford Dock. This
asset is home to a first class marina as well as Wales’ largest fishing
port. Investment in Milford Dock has
already begun, with new lock gates that have significantly improved access for
our fishing and marina customers, and the build of modern facilities at Milford
Fish Docks to facilitate growth in the fishing, aquaculture and food processing
sectors. However, further major
investment is planned in the next few years to create a vibrant new waterfront
destination focused on retail, marine-leisure and fishing. We expect this development to attract
significantly more people to the area, creating hundreds of new jobs and a
boost to the local economy.
Creating a ‘centre of excellence’ for marine-renewables
and engineering at Pembroke Port – The Port of Milford Haven is playing a
central role in a strong local supply chain which is ready and waiting to service
the developing marine-renewables sector.
We are investing our resources, both financial and in-kind, to
developers of intellectual property and other high-quality products with a view
to facilitating the development of a hub for the testing, manufacture,
deployment and servicing of these new technologies. The success of this strategy will result in a
better utilisation of our land and property assets in this area and will
provide the local community of Pembroke Dock with a new industry, creating
hundreds of new jobs and greater prosperity for years to come.
ESPO: The Port of Milford has been awarded the Port Environmental Review System (PERS) certification, which is the only port sector specific environmental management standard. In view of this could you briefly describe the port’s environmental policies?
Port of
Milford Haven: It is the policy of the Port of Milford Haven to
ensure that our business practices protect the welfare of our employees and the
communities in which we operate. Our Environmental
Policy is applicable to all employees and is also encouraged among our tenants,
contractors and other operations within the Port. It is based upon the principle of Best
Available Technology Not Entailing Excessive Costs.
Our Environmental Policy is as follows:
We will seek to attract and develop sustainable port
operations and to minimise impacts on the environment. We will promote shipping
as the mode of transport offering the least overall environmental impact and
will operate the Port in accordance with procedures designed to prevent
incidents that may cause environmental damage. The Port of Milford Haven has
adopted the following principles to implement its Environmental Policy for all
its marine and commercial operations:
- To endorse
the principles contained within the European Sea Ports Organisation’s Environmental
Policy Code.
- To conserve
the natural environment of the Haven, continue to promote its sustainable use,
and to protect it, particularly in respect of oil pollution.
- To respond
immediately to any environmental incident or threat within the Port by
utilising appropriate personnel and equipment.
- To design our
management systems or equipment to minimise our environmental impact,
especially from:
- Dredging programmes
- Oil Spill Response capability
- Port Marine craft emissions
- Utilities consumption
- Waste generation
- To monitor
and report annually on our environmental performance with the aim of achieving
continuous improvement.
- To create a
framework for setting and reviewing environmental objectives and targets.
- To comply
with relevant environmental legislation.
- To communicate
this policy to, and foster environmental responsibility amongst our staff,
tenants and contractors.
- To provide
appropriate training and encourage initiatives to enhance and improve our
environmental performance.
- To make available
all necessary resources to implement this environmental policy.
ESPO: ESPO is a partner of PORTOPIA, a FP7 project that aims to measure port performance. What is your approach for measuring the port’s performance?
Port of Milford Haven: We have a five year strategic plan which is a live document, reviewed annually and adjusted accordingly. From this plan we set objectives for each business function. Additionally, we have defined a set of key performance indicators that measure the success of our overall strategic objectives, and from 2016 we will be reporting to our stakeholders on those key performance indicators through publications such as our annual report and at our Annual Consultative Meeting, which is open to the public. It is the role of the Port’s Independent Board of Directors to monitor the performance of the management and satisfy itself, through review of the risk register and other reporting systems and procedures, that the business operates in compliance with the law and relevant regulations, to the highest standards of safety and with appropriate financial prudence.
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