Governor Ige announces milestone in harbor modernization

Posted on Sep 21, 2017 in Harbors News, Main, News

HDOT makes new terminal allocations, selects contractor for Kapalama Container Terminal Project

HONOLULU – – Gov. David Ige and the Hawai‘i Department of Transportation (HDOT) Harbors Division announced a key decision on the allocation of cargo yard space at Honolulu Harbor. The decision comes as the first phase of construction for the highly anticipated Kapalama Container Terminal (KCT) project is scheduled to begin in Dec. 2017.

TOTE Maritime will operate at Piers 1 and 2 and on 45 acres of adjacent land. As part of the agreement with the company, HDOT will improve and develop Piers 1 and 2, allowing TOTE to launch Hawai ‘i operations upon the completion of the infrastructure improvements. In addition, Pasha will consolidate its operations from Piers 1 and 2 and from its existing terminal at Pier 51A, to the new KCT with more space for operations. The moves enable Matson to expand into Pasha’s existing site at Pier 51A on Sand Island for a contiguous terminal of 130 acres.

“This achievement means there will be more shipping options for the business community throughout the state, which lends itself to competitive pricing and lower costs for consumers. The construction projects and tenant improvements will result in additional jobs and hundreds of millions of dollars invested in the community,” said Gov. David Ige. “We are modernizing Honolulu Harbor with much needed infrastructure improvements and creating space for a new service to enter the market while expanding terminal capacity for the entire shipping industry. This is not only a diversification of carriers, but of channels into our harbor to ensure the efficient and safe transport of goods to our islands.”

“TOTE is deeply committed to serving the people of Hawai’i,” said Anthony Chiarello, TOTE President and CEO. “We are making a substantial investment in the islands and look forward to launching a new service that benefits the community with vessels that are efficient and environmentally friendly. This decision ensures we have a working terminal to begin service and advances Gov. Ige’s vision for improved infrastructure and a stronger economy.”

“KCT is a shining example of a public/private investment partnership,” said George Pasha, IV, President and CEO, The Pasha Group. “We feel very fortunate to have the expertise and longstanding support of the Harbors’ capable staff, and look forward to continuing to team up with them towards the successful completion of the project.”

“Matson has made investments consistent with the state’s Harbors Modernization Plan for more than ten years. We are pleased that the plan remains intact and continues to be fair and equitable to all harbor users. This allows us to continue preparations for our much needed terminal expansion without interruption,” said Vic Angoco, Senior Vice President, Pacific.

Gov. Ige and the HDOT Harbors Division are also pleased to announce its contract award to Kiewit Infrastructure West Company for construction of the first phase of the Kapalama Container Terminal.  The KCT project at Piers 41, 42, and 43 in Honolulu Harbor is the centerpiece of the state’s Harbors Modernization Plan (HMP) and features a new 84-acre container yard and 1,800 linear feet of new berthing space. HDOT received six sealed bids for Phase I, with Kiewit submitting the lowest bid of $163,521,093.

“The Kapalama cargo yard is one of the most significant and impactful achievements of this administration,” said Gov. Ige. “As a legislator, I supported this initiative as an investment in Hawaii’s future. As governor, I recognize that there are few projects with such a wide-ranging impact on Hawaii’s residents.” Most of the goods we need for survival come in through our harbor system. More than 80 percent of all goods consumed in Hawai‘i are imported, and about 99 percent of the imported goods enter the state and are delivered to each island via our ten commercial harbors.

The KCT project will be constructed in two phases over a four-year period with an estimated project cost of $448 million. Upon completion, targeted for 2022, KCT will reduce the congestion in Honolulu Harbor. Its location bordering the existing interisland cargo yard will allow approximately 50,000 truckloads per year to move directly between the facilities, alleviating traffic on adjacent road ways.

Phase I – Landside Construction is scheduled to begin in December 2017.  Phase I includes an 84-acre container yard with an elevated two-foot grade to accommodate sea level rise, construction of support buildings, entry and exit gates, security fencing, parking, gantry cranes and container-handling equipment, on-site utilities, energy efficient lighting, a HDOT-Highways weigh station, and other ancillary features. This phase also includes the paving of surface streets leading to the adjacent existing inter-island cargo facility.

Phase II – Waterside Construction is tentatively scheduled to be out to bid in 2018, pending permit approvals.

The state thanks its industry partners and the Hawai‘i Harbors Users Group for its commitment to the Harbors Modernization Plan and the necessary tariff increases to finance the projects.

The HDOT Harbors Division administers the state’s commercial harbor system as a self-funded enterprise that generates revenue through collection of user fees, leases, tariffs and charges necessary to cover operating expenses and the costs of capital improvement projects. The harbor system receives no federal revenue or state funds from the General Fund, meaning it does not receive traditional taxpayer money from sources like income tax.