Project Management Institute

High-tech port a shipping haven

A massive new port development project will make Korea’s Busan the world’s most advanced container handling facility

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THEPULSE

BY SARAH PARKES

Every year, US$4 trillion dollars worth of merchandise makes its way from coast to coast and country to country on the more than 50,000 ships that make up the modern merchant fleet. This explosive growth in international trade, spurred by rapid globalization of markets worldwide, is the driving force behind a huge port development project in Busan, South Korea, that will soon make the city the most advanced container handling center in the world.

Strategically situated on Korea's southeast coast near the thriving markets of China, Japan and Taiwan, as well as South Korea's own booming commercial sector, the expansion and upgrading of Busan's large but congested port facilities will realize Korea's Ministry of Maritime Affairs and Fisheries' (MOMAF) vision of positioning the port as northeast Asia's key hub for container traffic.

The US$1 billion project represents the world's most high-tech port design, combining fast and flexible loading and unloading systems with custom-built, state-of-the-art IT systems to deliver unprecedented container throughput. Key players include Pusan Newport Co. (PNC), local industrial giant Samsung Constructions, U.S.-based terminal development and operations specialist CSX World Terminals (CSXWT), and Hyundai, Hanjin, the Korea Container Terminal Authority, among other leading Korean companies.

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The Busan port development project includes fabrication of 109 3,000-ton concrete caissons.

Covering everything from dredging, procurement and installation of the world's largest-ever super panamax gantry cranes, links to new high-speed road and rail networks and the development of highly specialized IT systems to handle container processing and logistics, the project schedule is too large to fit even on a very long office wall, says Gerard van den Heuvel, the project's director of operations.

“After winning the contract back in 2001, we spent a year and a half overhauling the initial project design to take advantage of new technological developments and advanced operational processes,” he adds. The 130-hectare container terminal, Phase 1 of which is on-track to begin processing shipments from 1 January 2006, will handle 3.5 million TEUs (20-foot equivalent container units) annually at peak capacity—a formidable figure that's set to double just 12 months later when the completion of Phase 1.2 will add an additional 1.6 kilometers (1 mile) of dock space and nine more super post-panamax cranes.

If bringing in such a huge undertaking on time and on budget is no mean feat, the project is benefiting significantly from the competence and professionalism of local Korean partners. Key CSXWT staff like Mr. van den Heuvel will work directly from PNC's offices in Busan for the duration of the project, with progress and troubleshooting meetings a part of the daily routine. Lead managers have been appointed for each core discipline—construction, maintenance, human resources, commercial, procurement and finance—with an additional 10 to 20 project managers attached to each group. Managers meet at least once a week, lead managers once a month, with written progress reports a prerequisite in more critical areas.

“Each team's schedule represents a large project in itself,” says Mr. van den Heuvel, adding that in-depth preproject planning has been essential to keeping things flowing smoothly. “Sticking to timelines and controlling risk are our number one priorities—if we succeed in managing those, everything else will fall into place,” he says. To that end, a highly detailed written budget was prepared well in advance in partnership with PNC and Samsung Construction, while lead managers identified potential bottlenecks as early as possible, adjusting timelines where necessary to allow for possible delays. Unusually, staff training requirements also were an important determining factor, with schedules for other project elements set by working backwards from end-of-project training schedules.

Innovative Spirit

The Busan project boasts an impressive number of “firsts,” according to Operations Director Gerard van den Heuvel:

  • New cranes with a 22-container-wide outreach and a huge 140-foot leg span, allowing for up to 10 lanes of container trucks to be loaded or unloaded underneath virtually simultaneously.
  • Performing as many as 40 moves an hour, the cranes are designed to effortlessly handle the new breed of post-panamax 400-meter “mega ships,” expected to come into service in the next 2-3 years.
  • In addition, a highly innovative split traffic pattern will enable cranes to load/unload from both sides at once, while a new staggered container stacking system will allow for more flexible deployment of gantry cranes to ensure ultra-fast turnaround.

“This new facility doesn't just comprise the longest berthing key and largest container cranes in the world, it's also the most technically advanced ever developed,” Mr. van den Heuvel says. Dockside staff will be equipped with wireless handheld devices linked to powerful computer systems that will automate information flows across a range of areas, from daily work orders to customs and quarantine procedures, staff deployment, ongoing procurement, and billing and financial analysis systems. GPS technology will be used to continually check and recheck the optimum location for each container based on its transport schedule and destination, and the system also will interface directly with the facility's IT-based maintenance system, as well as with external shipping, road and rail transport systems.

“Because training is usually one of the last agenda items, managers are often tempted to skimp and save, cutting back to make up for budgetary and schedule overruns. It's a huge mistake. If you fail to properly train your people to use the high-tech systems you've spent millions developing, you might as well have equipped them with a pen and paper,” Mr. van den Heuvel says.

Trust and shared expertise also are proving vital. “Developing custom-built systems optimized to Korean conditions has meant pooling our talents with our partners,” he says. “We specified our ideal system performance, they contributed their knowledge about Korean requirements, we performed a gap analysis and moved forward on system development from there. The mutual trust we've built with our Korean partners continues to be a cornerstone of this project's success.” PM

Sarah Parkes is a freelance journalist with more than 12 years of experience in the telecom and IT sectors. Based in France, she is a regular contributor to a number of U.S. and European publications, including London's Financial Times.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.

PM NETWORK | DECEMBER 2004 | WWW.PMI.ORG
DECEMBER 2004 | PM NETWORK

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