One party concerned about Union Pacific/Hong Kong company monopoly

Editor's Note: This is the last part of a two-day series on the proposed megaport in Punta Colonet, which could lead to a railway cutting through Yuma, linking to the Baja California community.

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ENSENADA, Baja Calif. - An official from a company interested in bidding on the megaport in Punta Colonet is concerned that an alleged partnership between Union Pacific and Hutchison, a Hong Kong-based shipping company, would shut out other companies from participating in the project.

Ernesto Ruffo, a former Baja governor who heads the consulting firm Puerto Colonet Infraestructura, says the port and railway project "will produce sufficient work for everyone," but if the government decides that companies are allowed to bid together, Hutchinson Port Holdings and Union Pacific could monopolize the business generated by the port.

The alleged partnership "to us seems exclusive and not competitive," said Ruffo, who is calling for open and fair bidding in the project to develop the megaport at Punta Colonet, a farming and fishing village on Baja's Pacific coast about 80 miles south of Ensenada.

But Ernesto Tatai, a Hutchison representative in Ensenada, said the Hong Kong shipping firm is waiting until the Mexican government releases bidding requirements before deciding its level of involvement in the Punta Colonet project. What's more, he said, the company has not made any commitment to a partnership with Union Pacific.

Tatai said Hutchison's only involvement with Union Pacific at Colonet has been a joint feasibility study into the port project in 2005.

He discounted concerns that Hutchison would monopolize shipping because, he said, the market has various elements.

"There are the ships, there are the terminals and there are the cargo owners. We are a leader in port operations, but we aren't the only one, and it doesn't mean we have or are going to have control of the market," Tatai said. "The government will define what it is it wants for Colonet, and on the basis of that, Hutchison will decide if it will bid or not, and if it does, then the details of the proposals will be decided."

Calls to several Union Pacific representatives were not returned.

"We hope that in addition to the rail lines serving all railroads possible, that all shipping companies will have access to the port at Colonet that want it," Ruffo said.

Ruffo is proposing that the Mexican government grant award one bid for construction of the port and another for the construction of the rail lines, but allow access to the rail lines and port to any company that wants it.

The Mexican government is expected to announce its bid specifications within the next few months.

Besides Hutchison and PCI, at least four other companies have indicated interest in bidding for the port construction project, among them Oakland, Calif.-based Marine Terminals Corp. and Seattle-based Stevedoring Services of America, which has a partnership with a mining company at Colonet.

"Mexico should create a competitive atmosphere, for the good of the region, for the good of binational relations, for the good of (the North American Free Trade Agreement), for the good of the Pacific Rim," Ruffo

said.

Tatai, the Hutchison representative in Ensenada, downplayed Ruffo's concerns.

"Hutchison is waiting for the bidding rules to be published before deciding if we're going to participate," Tatai said. "That's all I can say. We are a serious and professional company. We don't want to enter into any controversy.

"That does not mean we're in partnership, nor that we're necessarily going to bid together. All depends on the content and conditions in the bidding rules," Tatai continued.