Memorandum by the North Europe Container
Hub Project (POR 22)
Port development is understood to be both a
devolved and reserved matter, between Edinburgh and Westminster.
Stated Government Policy is to help ports help themselves, avoid
burdens, welcome practical contribution, encourage water-borne
transport and port co-operation to clear the roads, whilst making
the best use of existing natural and man-made capacity in preference
to new infrastructure.
Britain and Europe's increasing need for efficient,
economical, eco-friendly intercontinental containerisation can
be met through a single UK "hub and spoke" site in Scapa
Flow, Orkney. This is made possible by £700 million of international
capital being available for the project, a major inward investment
for the UK. It will provide the power house of the UK Water-borne
Intermodal Transport Revolution, radiating short-sea fast-feeder
services throughout Britain, Europe and the Baltic as far as St
Petersburg; put Britain back at the centre of the maritime map;
assure the future of Britain's present shallower ports; complement
rail services; by-pass bottlenecks at the Channel Tunnel and make
an ideal base for international disaster relief. Scapa Flow is
Europe's best natural harbour. Already accommodating the largest
ships with ease, Scapa Flow is Britain's insurance for the 21m
draught Mallaccamax future.
Scapa Flow makes the best use of geography,
natural resources and the debris of two World Wars. Ideal as the
now-required North American post-September 11 secure international
container gateway or safe portal, Scapa's strategic position will
accelerate the expansion of Russian, Baltic, Central and Eastern
European Trade. This will fill the empty containers which threaten
the viability of marine transportation, whilst bringing prosperity
to and consolidating democracy in Russia.
The economies of "OJIT, only just on time"
intercontinental marketing continue to drive the expansion of
containerisation. Major shipping lines are building networks and
alliances. Their success depends on swift, sure and economical
container services. Containers are transported about the world
by the most efficient mode of transport available, be that ship,
rail, road or air, switching transport modes "intermodally"
by "Intermodal Transport" as necessary. Container ships
are an essential part of the intermodal system. Cut-throat competition
enhances their contribution. That competition requires ever larger,
more economical ships being used at maximum efficiency.
Following commercial aviation practice, "megaship"
mainline services, running between "Hubs" and supported
by "Spoke" feeder shipping, are being developed everywhere
in the World, except in NW Europe where most profit is to be made.
Shippers demand reliability, security which includes specialised
services, economy, speed and convenience. The MSOs, MegaShip Operators
who serve them, survive on tight margins. They cannot and will
not be tied to a particular port (as Southampton, Felixstowe and
Rotterdam know to their cost). MSOs will go where the port service
is cheapest, quickest, with reliability and security for the greatest
load at maximal convenience. FSOs, Feeder Ship Operators require
the same, with schedules to keep from the Loire to the Urals.
Both are delay and fault intolerant. Both depend on ports which
support the most efficient ships. These ports will dominate the
transhipment trade generated by the economy of larger vessels.
If the UK fails to meet this inter-continental container transhipment
challenge or is prevented from so doing, shipping lines will divert
primary services to overseas ports. This will undermine the Government's
Integrated Transport Policy, increase the cost of UK trade and
reduce UK competitiveness.
Set like Byzantium of old, where the trade routes
from Europe, Asia and America meet, Scapa is not subject to the
"Global Competition" and "Divided Europe"
forecast models. Strategic situation and the need to fill both
containers and ships means that global competitiveness depends
Rather than divided, Europe north of the Loire-Alps-Carpathian-Urals
Line is united by need for the deep water transhipment Scapa can
provide. Optimal intermodal transport favours Scapa. Potential
blockade of the Bosphorus and Danube would further enhance the
importance of Scapa not only to the UK but the wider European
Economy. Russia's ability to enjoy and enhance the World Economy
depends on it. For international and disaster relief, immediate
access to the megaship system makes Scapa the ideal base.
The decisive trade shift from east-bound, trans-Pacific
to west-bound traffic from the expanding South East Asian economies,
will meld Baltic and North West European trade with that between
Asia and the American East Coast. For maximum loads, mainline
megaships will either call or tranship somewhere in North West
An intelligent, enthusiastic work-force empowered
by a state of the art, but reliable hub is required to exploit
this window of opportunity. Orkney provides both site and skill.
International recognition of the potential of the situation has
provided the finance. All the essential requirements of the project
are now in place. Except the political will to turn opportunity
The danger of the situation is that this opportunity
is not lost on the rest of Europe. Though less ideal, other sites
exist. If Scapa is not pursued with vigour, the available finance
and trade will go elsewhere. Leaving the UK the poorer, crippled
as a backwater of and obstruction to rather than the centre of
Europe and the World's Maritime Trade.
Easy, interdependent collaboration between Orkney,
the Hub and its workforce, captains, crews, ship operators, shippers,
Local, National and Harbour Authorities is the key to the success
of all the parties involved. FSOs have to keep to tight schedules.
MSOs need to keep their ships earning at sea. Container dwell
times have to be minimal. Flexibility maximised. Every minute
of the year put to best purpose in this key component of the global
system. Innovative design, enhancing the ability of the workforce
with improved technology; an optimised workplace exploiting Orkney's
strategic position; the environmentally friendly situation; the
25 year, proven track record of safe supertanker operations in
Scapa Flow; the immediate availability of the necessary international
finance; all together make this possible. There is no need for
subsidy, but political enthusiasm and support is now mandatory.
Britain's survival depends on international
trade. Trade is containerizing. Success depends on swift, sure
and economical container services. Containers transported to/from
the world by the most efficient mode of transport available, be
that ship, rail, road or air. This involves switching containers
between transport modesintermodally by "Intermodal
Container ships are an essential part of that
system. Cut-throat competition enhances their contribution, efficiency
and economy. Success is based on ever larger, more economical
ships being used at maximum efficiency. As in the aviation industry,
megaships running between "Hubs" supported by "Spoke"
feeder services are being developed everywhere in the World, except
in NW Europe. In Britain road congestion requires the urgent development
of alternative rail, water- and sea-borne transport systems.
Our purpose is the construction and operation
of a hub facility in Scapa Flow, Orkney, for fast, efficient container
transhipment between mainline Megaships, and fast feeder ships
serving North and North-West Europe, the Baltic, Central and Eastern
Europe, Scandinavia and Russia West of the Urals. This will return
the UK to the centre of the maritime stage, provide a 21 m facility
for the coming Mallaccamax generation of container ships and secure
the future of Britains's shallower ports. Scapa will pump new
life into the UK's off-road transport system, re-vitalising coastal
feeder and water-borne transport services. Scapa will promote
and facilitate the growth of "intermodal" transport
links, switching containers quickly and efficiently between transport
modes (barge, ship, rail, road and aircraft) as demand and economy
dictate. The volume of "Mainline" international transhipment
traffic passing through Scapa, will provide the necessary added
stimulus for the intermodal transport revolution throughout the
rest of Britain.
Megaship "Hub and Spokes" are the
foundation on which the development of the Global Economy depends.
They are as important to the Third World as to the First and vital
for Britain. Scapa Flow has the seven requirements for such a
facility: deep water, strategic location, space, environmental
compatibility, practicality, local support and a profitable, Europe-wise
hinterland. Within the UK, export trade is being driven back on
to the roads by the blockade of the Channel Rail Tunnel. Resurrection
and development of UK coastwise maritime links will allow resumption
of the Government's Road Relief programme, backing railways with
speedy efficient container ports, services and waterways. Meanwhile,
international disaster and relief programmes are looking for a
base on the global megaship system. Orkney is ideal.
Inspired by Dr Alfred Baird, Napier University,
Edinburgh in 1998 Messrs Scapa Terminals, Stromness, Orkney proposed
the present project in Scapa Flow, Orkney. They have been followed
and parallelled by an Orkney Isles Council (OIC), Highlands &
Islands Enterprise (HIE) and Halifax (Nova Scotia) Port Authority
partnership. Rather than simply the North West European end of
a North Atlantic link with Halifax, this Group's intention is
to make Scapa the "three in one" North West, Central
and North European (west of the Urals) component of the world
wide megaship "hub and spoke" system. The proposed international
strategic base for disaster management and relief in Orkney would
then have immediate access to the worldwide megaship network.
Scapa Flow is Europe's best natural harbour
and the "head" of Britain's transport "spine".
It is "on a Great Circle to everywhere". Scapa is the
"cork" to the Baltic "bottle". The key to
and focus of the Baltic's global surface trade. Russia must and
will play a progressively greater part in the World Economy. The
traditional western outlet for European Russia is St Petersburtg.
It already has a container terminal for intermodal interchange
to Russian Railways. Scapa is optimal for the Russian-North American
Trade. It will also provide convenient translation from Broad
to Standard Gauge Rail services to the UK and to Western Europe
through the Channel Tunnel. Russian proposals are for a "Girdle
around the Earth" service running from St Petersburg to Scapa,
thence to Singapore, Hong Kong and Nacholdkha/Vladivostock. P&O
and others have been to Russia and told the Russians how to do
things. Russians prefer to do things best their own way. P&O
discounted St Petersburg and proposed a Moscow container hub,
railroading containers west to transfer to standard gauge at Brest-Litovsk
for transhipment through Hamburg. Russian business is aware of
the opportunities Scapa will provide for them as well as for the
UK. The economy "spin-off" for Scotland and the UK in
general and the Highlands and Caithness in particular will be
A J Baird's work [http://www.orkneycontainer.com/Orkney.doc],
based on world wide interhub operations, indicates energy and
operational savings on present practice which include:
Mileage reduction: 114 per cent
Fuel cost reduction: 84.5 per cent
Capital cost reduction on next generation
megaships: 5.52 per cent
Total system operating cost reduction:
149 per cent
That a North West European Container Hub will
be built is undoubted. The question is where? For Scapa the question
is when? Scapa's strategic position and geography are idea. But
there is a relatively short window of commercial opportunity to
establish the Scapa Hub before myriad expensive, second-rate facilities
are built on the North East Atlantic seaboard.
The Channel and Continental ports are shallow.
Continuous, expensive dredging will not provide the 21m draught
required for future "mainline" "Mallaccamax"
generation container carriers. These ports are "hostages
to fortune". They will require expensive re-duplication to
keep them in business in the early years of this century. Rather
than competition, Scapa transhipment is these ports' salvation.
The nearest 20m berth is Sines, Portugal, which
the Port of Singapore Authority aim to have operational in 2002.
Between Mainliner and feeder ships, the Clyde adds a day's steaming.
Sullom Voe (adjacent to the Oil Terminal) and Swarbacks Minn,
both in Shetland, have deep water, and the former has adjacent
low land. Neither have an anchorage. Both are dependent on weather
slots for entry and immediate berthing/sailing.
On the Norwegian Shore, there are sites at and
between Bergen, Stavanger/Sandness and as far east as Kristiansund,
which have access to the Stavanger railway. The submerged-tube
rail-link across the Sound (linking Scandinavia with the European
railway system) is their equivalent of the Channel Tunnel. Its
problems are only too well known. As Mrs Dunwoody has indicated,
if the UK's European trade is not to be strangled by such snags,
sea transport has to be optimized and maximized. This in its turn
will exploit the current expansion of France's waterways.
MSOs, MegaShip Operators survive on tight profit
margins. They cannot and will not be tied to a particular port
(as Southampton, Felixstowe and Rotterdam know to their cost).
MSOs will go where the port service is cheapest, quickest, with
security for the greatest load at maximal convenience. FSOs, Feeder
Ship Operators, with schedules to keep, require the same. Both
MSOs and FSOs are delay and fault intolerant. Even without ship
development and the depth of water requirement to match the rest
of the World, Scapa is competitive in the present market place
as a pure transhipment hub, with fast low cost feeder services
to the UK, the Continent and the Baltic.
Bubble technology has put Russian 240 knot torpedoes
into service (vide Kursk). It can be applied to surface ships
as well as deep-diving concrete submarines. Major drag remains
at the waterline. Larger wetted areas and smaller waterlines mean
larger, faster, more economical vessels, but of increased draught.
For them and Mallaccamax (21m draught, limited by the Mallacca
Straights) vessels, depth of water is critical. Present-build,
orthodox and "Jumbo" class15 m draught ships
will require ever more expensive dredging in the Thames, Solent
and Continental port approaches. The Sound (the entrance to the
Baltic) is closed to them. Present builds and orders are for wider,
15 m vessels, to increase both capacity and stability after 50
degree roll incidents with load-shedding in the Pacific. Scapa's
commercial success does not depend on the depth of water it provides.
That is Scapa's and the UK's guarantee for the future. Nevertheless,
present developments will increase Scapa's advantages and further
disadvantage the competition. Scapa does not diminish the importance
or threaten the viability of other UK and European ports. Rather
it guarantees their future. Whatever direction the future takes,
with Scapa operational, North and North West European Industry
and Transportation will be competitive in World Market.
There are five potential sites in Scapa Flow
where the Megaship/SuperContainer Hub could be built. The Golta
Peninsula on Flotta is the OIC, Orkney Islands' Council's preferred
site. Messrs Talisman, who run the adjacent Oil Terminal and own
the Golta, are favourably disposed to the Hub Project. Though
local oil production may decline, Rockall, Faeroe, North Norwegian,
Barent's and White Sea developments will maintain Talisman's local
interest for at least a further 25 years. The objective is a mutually
beneficial development for all the parties involved: the Flotta
and Orkney communities, wildlife, OIC, Talisman, the Hub, together
with Scotland and the UK.
Safety is an issue with major oil landing, loading
and trans-shipment side by side with containers. Talisman have
a 25 years' track record, handling ships of up to 300,000 tons
dw. In practice the two activities are complementary rather than
incompatible. Environmentally, of all the competing Atlantic Rim
sites, Scapa poses the least environmental challenge. Scapa has
an established, environmentally-friendly tradition. Long established,
major Oil Trans-shipment and Oilfield Support have been practised
in parallel with Orkney's unrivalled natural environment. High
winds in winter mean that the aerodynamic challenge in Orkney
is similar to that for hubs in the Hurricane, Cyclone and Typhoon
Ultimately, Hub success depends on workforce
enthusiasm and ability, 24 hours per day, 366 days per year. In
recognition of this, novel approaches have been adopted to provide
an optimum workplace.
Much interest has been expressed in operating
the Hub. Local business is actively involved. They are keen to
pursue their initiative and contribute local knowledge, shipping
experience and management expertise. The Orkney Isles' Council,
the Highland and Islands Enterprise and the Port of Halifax, Nova
Scotia have actively promoted the project. Our group has assembled
a "hard heading" Management Team backed by a consortium,
as proved necessary for the Shetland oil terminal and port development
at Sullom Voe in the 1970s.
Full financial backing is available. This is
inward investment for the UK. The investors' concerns are for
predators and procrastination. The present economic down-turn
will assist Scapa allowing the project to catch up with and overtake
its continental rivals. The UK Government's handling of RailTrack
alarmed international investors. Elsewhere in the world, Government
and authority enthusiasm for and loyalty to internationally financed
projects is expressed in a financial manner often by a certificate
of deposit, which could be provided by the OIC. Alternative options
have been arranged for presentation to the OIC. Subsidy is not
sought for Scapa. Despite Dutch Government support for Rotterdam
(supposedly illegal under EEC Rules), subsidy would involve wrangling
and delay with the European Commission. Some part of such major
projects are expected to start commercial operations within a
year, from start of construction. This could be achieved on Flotta
by starting with the OIC.'s "minimal" proposal as a
£200 million Stage One adjacent to Talisman. Stages Two and
Three would then be rolled-out eastwards along the Golta Peninsula.
Talisman and/or the OIC own the Flotta site.
The OIC is staging an open competition to undertake the project
on behalf of the Partners, the OIC, HIE and Port of Halifax. This
group's proposal is the only "complete package" which
has financial support. Several organizational models have been
discussed with the OIC, including a Consortium of all the interested
parties. Environmental and engineering assessment, planning, design,
construction, engineering and port operation can be undertaken
by consortium or by standard commercial arrangement. The choice
of hub operator will be agreed with the OIC, the Port Authority.
There is local political support, which is recognized
to be the first requirement for such developments. Despite briefings
by Scapa Terminals, the OIC and the HIE, UK and Scots Governments
do not appear to be aware of the significance and opportunities
of the project. Mrs Dunwoody's Westminster Parliamentary Select
Committee has stressed the need to develop water-borne intermodal
and maritime links within the UK and Europe. Scapa with its fast
feeder ships is the missing link in the Dunwoody Plan. The Highlands
and Islands will be major beneficiaries. For Orkney it is an essential
component of the Isles' future economic viability. Scapa will
also demonstrate Westminster and Edinburgh government commitment
to the future prosperity of Europe. The European Commission is
aware of the project and feels that the project stands on its
own merit. There is all party UK support in the European Parliament.
The immediate requirement is formal commercial
assessment. The OIC has set aside £300,000 to further promote
the project. They are considering commissioning that Commercial
Assessment as the necessary next step towards assuring Orkney's
future economy. A standard certificate of deposit, with this Group
doing the rest, was suggested to the OIC on 8 Feb 2002. Once formal
commercial assessment is completed this group can immediately
commence environmental and engineering assessments for Planning
Application and Inquiry, if the latter is required.
Since 11 September 2001, container security
has been a major concern of all States. The US requires safe portals
and secure gateways. International confidence, hazard control
and surveillance demand it. Scapa is ideal for this role.
The bottom line is that a 24 hour, 366 day a
year trans-shipment hub in Orkney can beat the competition and
provide the UK and Norther Europe with the economic commercial
link necessary to compete effectively in the world's markets as
well as securing the long term future of Britain's other ports.
To succeed, the Hub's first requirement is political support.
Commercial success depends on a dedicated workforce providing
a "round the clock" operation. Orkney provides both
site and skills. That keen and skilled workforce must be empowered
with appropriate reliable and efficient tools for the job. Improvement
in hub design married to proven technology and favourable working
conditions will provide MSOs and FSOs with the speed of turn round,
loads, economy, security and convenience they need to keep ships
earning at sea, rather than losing money in port. Shippers will
get the reliability, economy, security, speed of delivery and
convenience that are essential to their success. For European
and North American Authorities, that efficiency and economy will
be matched by the opportunity to achieve the secure gateways they
are now required to provide. The UK will get economic spin-off,
cheaper transport and a major stimulus to the development of sea
and water-borne alternatives to the UK road network. It will ensure
that UK trade is not, cannot be crippled by Channel Tunnel, focal
or monopoly obstruction.