The Port of New Orleans is looking at whether a portion of the former Avondale Shipyard on the Mississippi River could be put to use as a breakbulk cargo terminal, though there are a number of hurdles to clear before any such project could come to life.
For starters, the 260-acre West Bank shipyard that Huntington Ingalls Industries closed 15 months ago was designed for building ships, not moving cargo, and the cost of converting the facility would be considerable.
And at this point, at least, the port and any potential partners would have to buy the whole site, for Huntington Ingalls has said it will neither lease the property nor sell only a portion of it.
Still, the port is conducting an engineering study to determine the feasibility and cost of converting a 32-acre portion of the former shipyard into a wharf for breakbulk cargo such as steel and other metals, rubber, lumber, heavy equipment, automobiles and other commodities.
Breakbulk cargo consists of goods that are loaded individually and not in containers or in bulk, like grain.
Depending on the outcome of the engineering study, another study would look into what the market might support and what private partners might be interested in bringing the sprawling facility back to life.
“We certainly believe it’s got a multitude of uses, which could be beneficial to go in there,” port CEO Gary LaGrange said. “But at the end of the day, it’s a menu, if you will, that we as one of the partners would present to Avondale and say, ‘Would you be interested in selling?’ ”
Avondale was for seven decades a major regional employer, giving jobs to thousands of workers, and in its heyday, it helped build middle-class communities throughout the West Bank and surrounding areas. In 2011, however, Huntington Ingalls said it planned to wind down operations, and the shipyard was closed in December 2014.
LaGrange said the port first looked into whether it could expand its container operations to the Avondale yard shortly after the 2011 announcement, but it didn’t take long to discover that modern container ships can’t get under the Huey P. Long Bridge.
That led port officials to begin considering other potential uses, leading to the current study, which LaGrange said should be done in two to four weeks.
If a breakbulk dock proves feasible, port officials say the entire site could become a deep-draft logistics and manufacturing park populated by shippers, manufacturers, terminal operators and other users on the remaining 220-plus acres.
Steel and other raw materials would be off-loaded for the on-site users to manufacture into finished products, which then would be shipped out from the same dock.
LaGrange declined to estimate a potential purchase price for the property, and Huntington Ingalls could not be reached for comment Monday.
LaGrange said the port will proceed with its studies as though all options, including buying only part of the property or leasing it, are on the table.
He said breakbulk, which is typically shipped on pallets or wrapped in metal bands, is a cyclical business, with demand for cargo rising and falling based on the demand for whatever finished products the materials go into making.
There is almost always something in demand, and LaGrange said he’s confident the market could sustain such a venture, provided the cost of retrofitting the yard and the purchase price are reasonable.
Follow Chad Calder on Twitter, @Chad_Calder.