 |
|
|
 Business News | June 2006 
Mexican Port Delayed
 Diane Lindquist - Union-Tribune
| | President Vicente Fox failed to start the bidding process as he was expected to do during a visit to Ensenada two weeks ago. (Charlie Neuman/Union-Tribune) |
Presidential election and mining prospects stall major Ensenada-area project.
Mexico's plans to develop a major container port at Punta Colonet in Baja California to transfer Asian goods into America's heartland have stalled.
The proposed port at Punta Colonet would be as large as the ports of Long Beach and Los Angeles combined.
Subsequently, César Patricio Reyes Roel, ports director for the Secretariat of Communications and Transportation, announced that the competition under which companies will bid to develop and operate the port was being delayed “three or four months maximum.”
Several forces are prompting the postponement of the project 150 miles south of the border that is envisioned to be as large as the ports of Long Beach and Los Angeles combined.
The presidential campaign has diverted the Fox administration's attention from the port project, while Mexican federal and Baja California state officials are bickering over how to structure the operation, said sources who asked not to be identified because of the political sensitivity of the subjects.
Moreover, a competing project in which an Ensenada businessman has secured mineral rights to more than 74,000 acres, including the port site, is preventing Mexico from publishing the port's coordinates, the first step in opening the bidding process.
“This is a mining project. It is not a container port project,” Gabriel Chávez, the Ensenada residential real estate developer who has obtained five mining concessions in the Colonet area, said in an interview this week.
He gained the concessions to extract minerals from the region several months ago under a new law that allows mining on the ocean floor.
Chávez says significant deposits of titanium and iron stretch more than 30 miles from Punta Erendia on the north to Colonet and further south. The concessions' boundaries reach from coastal property at the port site 12.5 miles into the ocean.
The value of the minerals, which are contained in more than 2 billion cubic meters of sand, is estimated at $70 billion, he said.
“Of course, I could be wrong. It could be a tenth of it,” Chavez said. “Anyway you want to look at it, it's more important than the port.”
Mexican officials say investment in the port and a rail line that would run to the U.S.-Mexico border east of Mexicali could total $4 billion to $5 billion. They expect additional infrastructure and other investment needed to create a city with as many as 200,000 residents supporting the port operations could run as much as $22 billion.
Chávez, who was the president of a group of Ensenada business leaders called Vida Enseñadense that spurred the move to develop a port and rail line at Colonet, said his motivation for the mineral project is to bring added-value industrial activity to the region.
Originally, he said, he tried to persuade communal ejido landowners to join him in developing the port project. But when most backed off, he was approached by mineral interests in Baja California who convinced him that extracting the titanium and iron would be more beneficial for regional development than the port.
Chávez said he has three partners and potential investors lined up, whom he declined to identify.
“We have not only buyers but companies willing to undertake the project. They don't care about a port,” he said, although he added that some kind of port operation would help his operation ship the minerals.
Under an agreement with the Autonomous University of Baja California, he said, students are conducting studies to determine the type and extent of the mineral deposits.
“It usually takes six to seven years to explore, drill and put the minerals on the market. We want to start exploitation before 22 months,” he said.
Chávez notified Mexican officials involved in the port project of his +mineral rights concession only recently.
“I thought it was my responsibility to explain this before they went public (with the bidding competition),” he said. “They thought I was coming to the party to kill the clown.”
The postponement of the bidding has prompted concern among maritime and rail companies interested in a piece of the project.
“People are getting concerned about the longtime viability of the project,” said Karen Hutchens, a public affairs consultant in Mexico.
“I think everybody's waiting for the bidding process to move forward and are thinking this will be a good project,” said Albert Fierstine, the former business development director of the Port of Los Angeles who now heads a consulting firm.
Jesús Lara, a Punta Colonet landowner who has been retained to represent ejido members in the matter, said, “The community is upset that it's stopping a project that will have benefit for them, the state and the country.”
“How can you explain that the minerals are located where there's interest for the port?” he asked.
Chávez denied implications that he is promoting the mineral development to extort money.
“I'm not for sale,” he said.
Sen. Hector Osuna Jaime, who represents Baja California and is chairman of the Mexican Senate's transportation committee, said the claim to the mineral rights causes a problem.
“If they want to take advantage, it's unfortunate,” he said.
But, he added, administration officials are trying to find a solution that will satisfy all parties.
“Everybody needs to understand that everybody could win,” Osuna said.
In his statement delaying the bidding process, federal port director Reyes said the government has abandoned the plan to dedicate all activity to container ships and would be willing accommodate mining operations.
“Without a doubt,” he said, “I believe the projects could exist together. The mineral part cannot function without a port, thus we are speaking with them and hope we can secure an important accord where both parties can have their activities.”
The Punta Colonet situation has highlighted some issues that weren't anticipated with the legislation allowing the assignment of mineral rights under the sea, Osuna said.
“The government,” he said, “is going to think twice about granting these concessions in the future.”
Diane Lindquist: (619) 293-1812; diane.lindquist@uniontrib.com |
| |
|
Vallarta Weddings
Tell a Friend
Site Map
Print this Page
Email Us