Last Modified: Tuesday, December 11, 2012 8:00 PM
The Port of Lake Charles will have a $4.5 million operating loss for 2013. Losses are expected to continue into 2014 but are being viewed as investments that will garner substantial revenue in 1-3 years, a port official said Tuesday.
The 2013 budget was presented at the port’s personnel and audit committee meeting Tuesday.
The port will go through a “ramping up” period in 2013 and 2014, said Richert Self, the Port of Lake Charles’ director of administration and finance, when there will be a lot of expenses to prepare for several “major projects” coming online in the next two years. These projects include Leucadia’s Lake Charles Clean Energy — located adjacent to the port’s bulk cargo handling facility — and the IFG bulk grain terminal, which is located at City Docks.
“We’re preparing for those things,” Self said. “We’re spending the money now in anticipation for those projects coming online but we probably won’t see revenue from them for two years.”
IFG may start making revenue in one year, while Lake Charles Clean Energy won’t bring in revenue for 2-3 years, Self said.
The increase in costs consists of $2.6 million relating to depreciation, six new staff members at the port, and dredging at City Docks associated with the IFG project.
And Self anticipates revenues being “down slightly” from 2012 because of Bulk Terminal No. 2 — where the port exports grain — being under reconstruction.
“We are in a transition period right now,” Self said. “So, we don’t anticipate moving any grains during the construction period. From a tonnage perspective, that is the only decline or change for next year.”
Self said the port anticipates a significant uptick in revenue in 2015 and beyond.
The committee recommended the approval of the 2013 budget. It will now go before the full port board at its Dec. 17 meeting.