BHP appoints new Port Hedland tug operator

BHP Billiton has confirmed that Rivtow, a subsidiary of Riverside Marine from Queensland, has won a contract to operate 14 tugs inside Port Hedland 

Riverside Marine is now at the heart of Australia’s iron ore industry as a result of the decision, ending Teekay’s decade-long role within the commodities port.

Three unions –the Maritime Union of Australia, the Australian Institute of Marine and Power Engineers and the Australian Maritime Officers Unions ran an industrial campaign last year to protect the entitlements of existing tug workers.

Tug workers won improved annual leave in the industrial dispute, but had since been negotiating to surrender conditions after Teekay indicated it was unlikely to retain its contract if improved terms were allowed to stand.

While BHP has denied that Teekay was given the impression that the conditions would have to be surrendered, a statement from BHP showed that “cost-effectiveness” was the reason behind pushing contractors to lower their margins.

“The contract has been awarded following a competitive tender process for BHP Billiton’s largest tugboat fleet based on safety, capability and cost effectiveness criteria,” the miner said in a statement.

BHP holds the exclusive rights to operate tug services within Port Hedland, and had until 2014 subcontracted that right exclusively to Teekay Shipping.

The tender process run by BHP comes as the operator of Port Hedland, Pilbara Ports Authority, continues to mull whether to issue a second licence to rival BHP's exclusive hold on tug services at the port.

*This article originally incorrectly claimed that the appointment of Rivtow was a result of an industrial dispute, however Teekay's contract came to an end after ten years and participated in the tender process.