'DARLING SINKS ABP's £600m DREAM FOR DIBDEN BAY'

Lerenius Rules Out Appeal

Lloyd's List – 21 April 2004

by Janet Porter

Plans to build a huge new container terminal at Dibden Bay were rejected by the government yesterday on environmental grounds. The decision represents a huge setback for Associated British Ports, which had spent eight years and £45m on its planning application for a 2.3m teu a year facility that the shipping industry claims is urgently needed to handle booming trade volumes.

However, ABP will not appeal the decision to block the £600m ($1.1bn) scheme.

"Dibden Bay is history,"

ABP chief executive Bo Lerenius said yesterday as the company announced a £100m share repurchase plan, and vowed to press ahead with a £400m investment programme to develop other facilities at its 21 UK ports.

While accepting the case for more container-ports in the UK, the planning inspector described ABP's assessment of the environmental impact of the Dibden Bay project as "fundamentally flawed".

Tony McNulty, Parliamentary Under-Secretary of State for Transport, said the Government fully recognised the nation's and industry's needs for additional terminal capacity in order to meet future economic demand.

"Every proposed port development must nevertheless be justified on its own merits,"

he said in a statement.

"One important factor in the making of this decision was the environmental impact of the proposals on internationally protected sites."

The verdict was hailed by opponents who have been campaigning vigorously to stop the development from going ahead.

"This is a slap in the face for the big boys and the 'get-rich-quick' merchants who bullied and blustered that the development was inevitable,"

said Julian Lewis, MP for New Forest East, dubbing it an

"amazing victory of David over Goliath".

However, major shipping lines and industry interests warned that the UK economy could be harmed without sufficient port facilities, while the Port of Southampton said the consequences for the local economy were "very serious". The decision "will certainly result in a loss of job opportunities in the area", said port director Andrew Kent.

"The future shape of the port will now be significantly different to that of the expanded Port of Southampton which we had planned for."

Construction of the six-berth 240-hectare site would have created about 800 jobs in the short-term, while the completed facility could have provided permanent employment for up to 2,000.

Transport Secretary Alistair Darling accepted the inspector's findings that Britain will require new port development to meet future trade volumes, but noted that three alternative projects were being considered. None of these had been proposed at the time plans to develop Dibden Bay were first put forward.

"There is no reason at this stage to rule them out as not being capable in principle of providing the additional capacity for container handling in the south east of England,"

Mr Darling said.

The negative decision, which stunned industry insiders who had been expecting the go-ahead with conditions attached, came on the first day of the public inquiry for a deep-sea terminal at Bathside Bay in Harwich, owned by Hutchison Ports (UK) which has also submitted plans to build a container facility at Felixstowe's Landguard.

Ahead of both those schemes is P&O Ports' London Gateway proposal at Shell Haven in the Thames estuary, which is waiting for a decision by Mr Darling. P&O Ports intervened at a late stage in the Dibden Bay case, writing to the Secretary of State in February about the issue of channel access at Southampton. However, P&O Ports, which has a half share in SCT along with ABP, would not comment yesterday on either the letter or the Dibden Bay ruling.

The public inquiry lasted a year with 15,000 pages of documentation submitted, but Mr Lerenius stressed that no more time would be spent on Dibden Bay.

"I'm disappointed and somewhat surprised, but that's it,"

he said.