Advice on securing Victoria's ports capacity
In May 2016, the Special Minister of State requested Infrastructure Victoria develop independent advice on when to invest in container port capacity and whether a second container port should be located at the existing Port of Hastings, or a new Bay West location.
There are three key elements of the advice:
Capacity of Victoria’s existing commercial ports should be optimised, having regard to social and environmental factors, before any investment in a second major container port
The Port of Melbourne should be developed to a capacity of approximately 8 Million TEU, with some trades relocated to Victoria’s other commercial ports at Hastings, Portland and Geelong. Capacity at the Port of Melbourne could be increased to approximately 8 million TEU without building a dedicated road and rail Freight Link through Fishermans Bend to Webb Dock.
A second major container port will not be required until the Port of Melbourne reaches approximately 8 million TEU which is likely to be around 2055
Detailed development planning for a second major container port needs to begin approximately 15 years prior to the port being required. Based on current analysis and projections, detailed planning for a second major container port should begin around 2040, with the new port to begin operation around 2055. Land use planning actions to secure necessary need to be taken as soon as possible.
Bay West is the preferred location for a second major container port
Bay West has strong transport, land use, environmental and amenity advantages, when compared to Hastings. Bay West is a good options for catering to container demand once capacity at the Port of Melbourne has been exhausted and is also well suited to becoming Melbourne’s future container port in the long term.
To support implementation of our advice, Infrastructure Victoria has made 19 recommendations to the Victorian Government in the following six themes:
- Monitor and publicly report on key port related indicators
- Optimise the capacity of existing ports
- Understand the variables that may alter planning timelines
- Preserve long-term port options
- Baseline and monitor environmental conditions
- Optimise governance of Victorian ports
You can read the entire advice to government here.
Scope of advice
The Terms of Reference provided by government provides the scope of the advice, and outlines the following issues that should be addressed:
1. Scenarios for the long term demand for, and capacity of, existing Victorian commercial ports, including:
a) when the need for a second major container port is likely to arise and what variables may alter this timeline
b) capacity for containers, bulk and other non-containerised cargo;
c) the capability of Victorian channels and existing port infrastructure to handle different scenarios of future changes to the international shipping fleet, cargo handling technologies and changes to the supply chain onshore; and
d) potential increases in capacity resulting from investment and improved port management under the Port of Melbourne lease arrangement.
2. Where a second major container port would ideally be located and under what conditions, including the suitability of, and/or barriers to investing in, sites at the Port of Hastings, and the Bay West location, including:
a) the indicative costs, risks and benefits of above options, including impacts on metropolitan, regional and interstate (including Tasmanian) supply chains;
b) any necessary measures to preserve the long term optionality at these sites including any appropriate relevant planning measure, environmental protections, or land and transport corridor reservations which may be required
c) impacts and requirements that a second major container port would take place on surrounding and supporting infrastructure, and the impacts – including the costs to Victorian taxpayers – of any complementary infrastructure investments that may need to be considered; and
d) the environmental, economic and social impacts of developing a second container port, as well as the environmental, economic and social impacts of the required complementary infrastructure, on existing local communities.
More information on the background, scope of advice and process is available in the Terms of Reference.