FOIPOP Findings: Feasibility

The feasibility of developing a terminal for the world’s largest container ships in Sydney harbor is something you’d think the proponents would probably want to determine relatively early on in the process and yet, by 2014 — after the $38 million dredging of the harbor — the port team had yet to produce a feasibility study.

This is an interesting period in the project, because it saw our secret, new port promoters, Barry Sheehy and Albert Barbusci, working with our old port promoters — Paul F. Richardson and Associates (PFRA).

In July 2014, the whole gang planned to meet at the Global Marine Terminal in Jersey City, New Jersey. According to an email sent by Brad Winfree of PFRA to his colleague Ed Zimny, Michael Kraft and Brad Cutsey of Dundee Capital Markets, Barbusci and John Whalley, the former economic development manager of the CBRM, the list of attendees at the meeting included:

Following this meeting, Sheehy penned a Port of Sydney “value proposition” for Dundee Capital. He first wrote:

Moffatt & Nichol Engineering has been tasked with completing a feasibility study, business case and economic model. The analysis, available shortly, will validate the case for the Port of Sydney outlined in this brief summary.

Before you go searching for that feasibility study, business case and economic model produced by Moffatt & Nichol, let me save you some time: in a subsequent draft, Sheehy scratched out “Moffatt & Nichol” and replaced it with “A leading firm with extensive experience in transportation infrastructure and harbor development.” He lets the part about the analysis being available shortly stand, although that doesn’t jibe with the discussions the “port team” were having at this time — it doesn’t even jibe with what Sheehy himself wrote to Dundee and the port team at this time, after Dundee sent the CBRM the draft Letter of Engagement I’ve discussed elsewhere this week:

Now that the Letter of Engagement is in hand and we can confirm a number of investment funds are keen on the project, what’s next? There’s no point pursuing more funds until the feasibility study is completed. That is why it is urgent that the study be commissioned as soon as possible.

(My working theory, by the way, is that Sheehy has such faith in the power of his pen he actually believes that if he writes it, it is so. How else to explain the claim, elsewhere in this document, that the Port of Sydney has access to double-stack rail?)

 

On hold

Rather than having already engaged a company to complete “a feasibility study, business case and economic model,” the summer/fall of 2014 found the port team reviewing “financial modelling proposals” from various consultants — proposals the CBRM was mysteriously unable to produce for me. Mind you, Gogan didn’t send me a redacted version of the proposals or state that he was withholding them, they simply don’t appear among the documents released, although the idea that the CBRM could find an email from Barbusci to Mayor Cecil Clarke et al that states, “See attached proposal from Drewry,” but could not find the attached proposal strains credulity.

Greenfield site or Novaporte, if you prefer.

Greenfield site or Novaporte, if you prefer.

At end-August, Moore called for a meeting to review proposals from PFRA, Drewry and Hackett, none of which is included in the document dump. The only glimpse we get of them is in a September 1 email from James Hunt of Cardno (a “global infrastructure, environmental and social development company”) to the gang:

Here is a quick review of each of the three proposals received last week, plus a “matrix” with my assessment of what each proposal covers. I have also attached a draft Scope of Work for a combined “Feasibility Study”, based on information from the Hackett and PFRA Proposals.  I have sent this draft to both Ben Hackett and Ed Zimny to review and provide comments. Once I get their comments, we can finalize and come up with a cost. I mentioned John’s suggested budget ($300,000) so after I get their comments and finalize the scope, we can submit a fee proposal.

…I think the combination of Cardno, Hackett and PFRA, with maybe using Drewry models and/or data, is the right combination for this study.

The CBRM didn’t release any of the documents referenced by Hunt either.

On September 30, Sheehy wrote that while the Drewry and Hackett quotes were reasonable:

…the PFRA quote is beyond the pale. The boys in NJ must think Cape Breton is funding the combined Gemini and Apollo Space Programs.

And the feasibility study was put on hold.

 

Bechtel

In November 2014, as negotiations to get McKeil Marine into the harbor were taking center stage, Sheehy wrote to Clarke, Mike Moore (a consultant working on the CBRM’s “port team”) and Barbusci with some “Thoughts on strategy”:

Once we get McKeil closed and our arrangement going forward solidified, the next target is Bechtel…

With Bechtel’s brand name we can bring Dundee in as our prime financing partner pending of course the outcome of the feasibility study. The key is to get them to allow us to use their name. With Bechtel and Dundee’s names behind us we can open any door in the world. Albert is now looking for the right Chinese investor to augment Dundee.

Bechtel does indeed enter the picture the following spring, but it should be noted that it didn’t seem particularly anxious to let Sheehy and Barbusci use its name. Trying to draft a press release about Bechtel joining forces with HPDP and CBRM in June 2015, Christina Lamey, Clarke’s spokesperson, kept pushing Barbusci for a quote from someone — anyone, apparently — at Bechtel “confirming their participation” in the project.

“This small comment,” she explained to Barbusci, “protects against pressure to say more.” (In other words, “We can fob off pesky reporters by answering ‘BECHTEL! to every question” — which is pretty much what they did.)

Lamey even wrote the small comment herself in a draft of the press release:

“We look forward to working with Harbour Port Development Partners, Port of Sydney Development officials and the municipality,” said Bechtel spokesperson XXXXXXXX.

Barbusici tried to run it past Bechtel’s Peter Mcmahon, calling it a “small revision” featuring “a very light quote from you,” but Mcmahon wasn’t having it:

Can we forego changes at this late hour? I pushed it hard on Friday, and I don’t really want to go back and push a second time…are you OK?

Bechtel finally became more forthcoming about its participation in December 2015, after the involvement of the China Communications Construction Company in the project was announced. Bechtel’s Rex Gundle went on CBC’s Information Morning Cape Breton with Steve Sutherland to insist the company was still part of the “team” working toward developing the port. (It’s really interesting to listen to Gundle dodge questions about who is paying him or how much. He will say only that his contract is with HPDP. But as the Spectator later discovered, it was the Port of Sydney footing the bills.)

But Bechtel also faded from the picture — all mention of it has been wiped from the Novaporte website — and by April 2016, that is, two years after talk of completing a feasibility study began, Port of Sydney CEO Marlene Usher told a reporter that the container terminal project was “contingent on a feasibility study currently being undertaken by [Chinese Communications Construction Company].”

In response to a question in October 2019, Usher told me the feasibility study had, in fact, been completed by CCCC but was the property of “Novaporte and or SHIP.”

Which means no member of the general public has ever seen whether or not the plan for the harbor is feasible.