Submitted by Suanne Z. Thamm
Reporter – News Analyst
February 23, 2015 9:00 a.m.

Val Schwec
Val Schwec

Members of the Fernandina Maritime Exchange, elected Port Authority commissioners and interested members of the public gathered in the Nassau County Board of County Commissioners’ meeting chamber in Yulee on February 19, 2015, to hear Val Schwec deliver an update on the state of the Port of Fernandina. Schwec, who is the Commercial Director for the Southeast Region for Kinder Morgan Terminals, runs the business end of the Fernandina Beach port on behalf of the elected 5-man Ocean Highway and Port Authority (OHPA).

He began his talk by providing some background on his parent company, Kinder Morgan, as seen in the slide below.

DSCN4247

 

Schwec informed his audience that he did not want to dwell on 2014, one of the lowest tonnage years the port has experienced due to a significant drop in steel exports. He cited a good partnership with the OHPA, which has been confrontation-free over the years. He also cited a major port success story in having just completed 28 years with the shipping firm Somers Isles. He said that Fernandina Beach has a premier port with lots of flexibility and the infrastructure that will allow it to get back on track this year.

Somers Isles has shipped goods through Fernandina's port for 28 years.
Somers Isles has shipped goods through Fernandina’s port for 28 years.

The biggest asset the Port of Fernandina possesses is its 2.2-mile channel, which allows ships to save considerable operating time. In contrast, Schwec said, ships transiting to Jacksonville’s port require an added 2-3 hours and those doing business in Savannah require an added 4 hours. There are no bridge obstructions in navigating Fernandina’s channel, and there is a turning basin directly across from the pier. The 1200 linear foot pier allows the port to handle two vessels at a time.

While the port has an 11-acre container yard, that translates into 9.5 usable acres. If it were at full capacity, it could handle 3200 TEUs (cargo containers), but that would mean that the port could then handle nothing else. The port has a 200K square foot warehouse, with offsite warehouse on Friendly Road and in Yulee. The Fernandina port is a full service port.

Schwec talks about improvements to the port of Fernandina.
Schwec talks about improvements to the port of Fernandina.

The port concentrates business activities in four areas: container traffic for north-south trade lanes, break bulk operations for primarily forest products, bulk cargo, and off-port warehousing and distribution, which expands the reach of the port.

Schwec listed a series of capital improvements anticipated including a $400K warehouse project, rehabilitation of the gantry cranes ($2M), and replacing dock fenders ($600K to include grant funding).

Acting on a tip from the Brunswick port, Fernandina took advantage of an opportunity to import oats for the horse racing community this past year. Based upon that success, the port may be handling even more grain imports in the future. Other new opportunities for 2015 include liner service to the west coast of South America and liner service to Spain and the Mediterranean.

Other activities are not yet certain but highly probable for 2015 including weekly container service connecting North and South America, importing fertilizers and salts, and packing containers for export with goods that arrive by rail.

Schwec also cited some headwinds that the port will encounter. With the value of the dollar increasing, exports become more expensive. With weak economies and deflation in the European Union countries, US exports could suffer. He also cited political risks as a factor in the shipping business, especially problems in the Middle East, the Russia-Ukraine conflict, and smaller, trade dependent governments around the world.

OHPA Chair Richard Bruce thanks FMX for educating the community.  OHPA Commissioner Danny Fullwood in foreground; OHPA Commissioner Carrol Franklin at far left.
OHPA Chair Richard Bruce thanks FMX for educating the community. OHPA Commissioner Danny Fullwood in foreground; OHPA Commissioner Carrol Franklin at far left.

The state of Florida has launched initiatives to increase the business going through Florida’s ports. Currently, 50 percent of all containers that enter Florida arrive from another state, as opposed to being shipped directly to Florida. Florida receives little benefit from such shipping while having to pay for the roads and infrastructure to support the transport of these containers by road or rail.

In an attempt to bring more business directly to Florida ports, there is growing emphasis on marketing, distribution centers, streamlining the regulatory process, and attracting export-oriented industry to Florida.

At the conclusion of Schwec’s remarks, OHPA Chair Richard Bruce thanked the Fernandina Maritime Exchange, a not-for profit organization that was formed about 5 years ago, for helping to raise awareness in the community on the importance of the maritime industry.

In closing his remarks Schwec presented a photo of the Fernandina waterfront in 1907 to show how the port has changed over the years.  “You can never forget where you were,” he said.  The photo below was not the one Schwec presented, but it is taken from the Florida Photographic Collection and shows a different view of the 1907 waterfront.

1907 port

Suanne Thamm 4Editor’s Note: Suanne Z. Thamm is a native of Chautauqua County, NY, who moved to Fernandina Beach from Alexandria,VA, in 1994. As a long time city resident and city watcher, she provides interesting insight into the many issues that impact our city. We are grateful for Suanne’s many contributions to the Fernandina Observer.

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Dave Lott
Dave Lott (@guest_29283)
7 years ago

thanks for the comprehensive meeting summary.

Medardo Monzon
Medardo Monzon (@guest_29309)
7 years ago

Mr. Shwec’s leadership as Commercial Director has been disastrous. Tonnage has decreased steadily (3 fold!) in the past five years and that’s why the port is struggling financially. He didn’t “want to dwell” on 2014 but he can’t dwell on the past 5 years. When will Port Commissioners hold Nassau Terminals accountable for their poor performance? This community needs a different port operator that is not tied to an energy company with a tarnished environmental record that pretends to use our city and port as an extension of their business without regard to the interests of the community.

Steve Crounse
Steve Crounse (@guest_29356)
7 years ago
Reply to  Medardo Monzon

The vast majority of Kinder Morgans Business is movement of Coal, and Fertilizers, Dry Chemicals ( Dry Bulk) Petroleum products, Oil, Gas, ethanol, CO2 , Natural Gas, liquid Chemicals, and of course Liquefied Natural Gas. ( Liquid Terminals ) Which of these do you want Trucking or Piping through our Town? ” Kinder Morgan does not have a Political Action Committee” I think that’s true, no (PAC ). But through Richard And Nancy Kinder, Kinder Morgan have given huge amounts of monies to other PAC’s, Political Campaigns, and have hosted fund raisers for Presidents and those running for President. Plus their Legions of lobbyist in Washington DC and State Capitals are characterized “as very aggressive” Richard Kinder’s Salary is one dollar a year. But, he’s not being Altruistic. He holds a majority interest of stock in the Company. Since leaving ENRON CORP.( He was President of Enron Corp. til 1996 ) When he and Morgan started KMCorp. Richard was a mere muli-millionaire. But while at the helm of Kinder Morgan he has been able to parlay that to 11.8 Billion. His mantra is “We’re run by shareholders for shareholders” If your an investor, check it out, quite impressive. But their good neighbor policy suffers because of that. For a snap shot of what type of neighbor Kinder Moran is in other communities check out. http://www.sightline.org then click on Facts about kinder Morgan. I know I’ve posted this web site before, but figure new folks need to see the reality of what the Port people are trying to sell to our town. Until the Port Commissioners, state exactly what is in the future for our Port, we need to assume the worse scenario. Sad, it doesn’t have to be that way. Stop trying to Sugar Coat Fossil Fuels.

Steve Crounse
Steve Crounse (@guest_29478)
7 years ago
Reply to  Medardo Monzon

Looks like the Censor Monster is at work. Check this site out ( http://www.sightline.org ) Fight on people

David Olson
David Olson (@guest_29577)
7 years ago

While the question of what is the number of employees at the port has been asked at these meetings, has it been published? I have not learned the answer. How many live in Fernandina Beach? In Nassau County? They are who interest me. Not the business of the port and the profits made for Kinder Morgan.

Steve Crounse
Steve Crounse (@guest_29675)
7 years ago
Reply to  David Olson

Mr Olson, The number of employees at the Port has always been a mystery. But someone on the Commission or at the Port let it Slip last Month. The number was 59 employees. But the Port furlowed or layedoff 12 or 16 of those employees ( I’ve heard both numbers, 16 via blog. 12 via Commissioners Gass’s statement.) So 47 at the Maximum.

Robert Warner
Robert Warner (@guest_29604)
7 years ago

Has the Port ever contacted or involved the U.S. Navy – which, I think, has quite an interest in what comes in and what goes out of the port through the channel to the open ocean ….

Brian Seuter
Brian Seuter (@guest_29755)
7 years ago
Reply to  Robert Warner

Mr. Warner,
I can personally attest to the extraordinarily high level of cooperation between the Port, our local Harbor Pilots, King’s Bay Harbor Pilots, the United States Coast Guard, the United States Navy King’s Bay Security Forces, US Customs and Border Protection, local ship’s agents and Nassau County Marine Patrol. The Navy’s only interest in our port is that we cooperatively share the Entrance Bar Channel and navigate safely without impeding the transit of High Value Assets. I am sure the present or future breakdown of our cargo commodities is not on their radar and the only reason it is not is because it is not germane to their mission. The conversation about what should or should not be handled at the Port of Fernandina is an interesting conversation but one that has nothing to do with the Navy.
Respectfully

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