Port of Brownsville, Texas gets permit for $350 million channel deepening project

The Port of Brownsville recently received a key permit from the U.S. Army Corps of Engineers to deepen the 17-mile Brownsville Ship Channel. Dredging on the $350 million project could start in 2020.

The U.S. Army Corps of Engineers (Corps) permit issued June 6 is the latest step in the port’s effort to deepen the ship channel from 42 feet to 52 feet – enough to accommodate larger vessels carrying more cargo.

The Port of Brownsville has been fighting for channel dredging funds since it first expressed the need for the project in 2007. Port Director Ed Campirano has called the channel dredging the most important project to sustain operations at the port.

“If ships carrying 55,000 metric tons of steel can increase their cargo load to 80,000 metric tons, their cost goes down. It’s about efficiency and cost,” Campirano said.

It is also about staying competitive. “Every port is deepening its channel to 50 feet-plus,” Campirano said.

Located 277 miles south of San Antonio at the southernmost tip of Texas along the Gulf of Mexico, the Port of Brownsville is the only deep-water seaport located along the border, making the port a major trade channel between Texas and Mexico.

Port leaders and boosters have a deep interest in furthering trade between the United States, Mexico and Latin America with a deeper ship channel. The Port of Brownsville’s foreign trade zone (FTZ) accounted for exported cargo valued at $3.6 billion last year.

In 2018, the port moved a record 11.3 million short tons of cargo, up from 10.6 million short tons a year ago, said port officials. The port also surpassed a record $24 million in operating revenues. Rolled steel and liquified natural gas are major exports.

The next step for the ship channel deepening project is to secure the total $350 million needed for the dredging, which port officials expect to cover through a combination of private and public funds, including federal dollars.

The Brownsville Navigation District – which operates the port – recently signed an agreement with NextDecade Corp., which plans to build a Rio Grande liquefied natural gas (LNG) terminal on the channel.

Houston-based NextDecade’s agreement with the Port of Brownsville will pay for deepening from NextDecade’s lease on the channel to the Gulf – nine miles that are about half the length of the project.

NextDecade plans to construct and operate the Rio Grande LNG project on a 984-acre site on the Port of Brownsville Ship Channel. The proposed LNG project could create nearly 6,000 direct jobs during construction. Operating at full-scale, Rio Grande LNG is expected to contribute more than $500 million annually to U.S. GDP and create approximately 5,000 permanent jobs, the majority in Cameron County, Texas.

Arkansas-based Big River Steel is also doing its due diligence with Brownsville to possibly build a $1.6 billion steel mill that would be capable of producing 1.6 million tons of steel annually. The plan would be to export the steel to Mexico and to supply U.S. auto manufacturing facilities, port officials said.

_{Source: freightwaves.com}