PANAMA CITY — As cargo ships get bigger, Panama City mill company RockTenn is seeking a deeper shipping channel in St. Andrew Bay.
To begin the process to dredge a portion of the East Channel, Port Panama City is sponsoring a U.S. Army Corps of Engineers (USACE) study to explore the environmental and economic impacts of the project, which would deepen RockTenn’s cargo terminal from 30 to 36 feet.
As one of North America’s leading manufacturers of paperboard and packaging materials, RockTenn’s Panama City facility produces unbleached Kraft linerboard and bleached market pulp product, which is exported to 28 countries.
Although the Port Authority does not directly conduct business with the mill, Director Wayne Stubbs said RockTenn’s shipping activity is vital to sustain.
“The ships are getting bigger, so they need to have deeper water to operate efficiently out of that facility,” Stubbs said. “We are cognizant that you need a certain amount of shipping activity to be a healthy port. It’s very important to the whole port infrastructure that (RockTenn’s) activity continues and is sustainable.”
The study began about six months ago and will include a cost-benefit analysis to determine whether the economic benefit justifies the public expense for the project.
“There is a way for a private company to pursue dredging in a federal channel outside their waters, but it’s pretty difficult to do,” Stubbs said. “In order for (the Corps) to dredge it and maintain it, there has to be some public interest involved.”
The project is outlined in the port’s 2014 draft Master Plan as part of its five-year, $52 million maintenance and expansion plan. The draft plan outlines $250,000 in funding for the project in the 2014-2015 capital improvement program and $3 million in 2016-2017 program.
If dredging is found to be environmentally and economically feasible, 65 percent of the project funding would be provided by the Army Corps, while the remainder likely would come from a funding agreement between RockTenn and the port, Stubbs said.
Although the cost of the dredging has not been determined, it’s estimated in the $6 million to $8 million range.
In a statement released Wednesday, RockTenn praised the Port Authority for its ongoing support of the project and study, which is expected to be completed next spring.
“The Panama City Port Authority and the USACE are to be praised for taking on this project,” said Robin Keegan, director of corporate communications. “We continue our interest in exploring the possibility of teaming up with them on this important endeavor.”
Norcross, Ga.-based RockTenn purchased the Panama City mill out of bankruptcy in 2011. The facility has been in operation under various owners for more than 80 years.
