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Federal Court Delivers Ruling On Bayport

Maritime Activity Reports, Inc.

May 6, 2004

The Port of Houston Authority (PHA) welcomed U.S. District Court Judge Vanessa Gilmore's ruling on the motions for summary judgment that had been filed by the U.S. Army Corps of Engineers, PHA, and the opponents of PHA's Bayport Container and Cruise Terminal project. The court ruling grants the Corps' and PHA's motions and denies the opponents' motion, thereby dismissing the challenge to the Bayport permit. According to the court's ruling, "The court finds that the actions of the Corps fully considered and complied with the requirements of the National Environmental Policy Act and the Clean Water Act."

"The port authority is gratified to have prevailed in this important matter," stated Jim Edmonds, PHA chairman. "The port authority greatly appreciates the intensive work of the federal judge and her court in addition to her willingness to resolve this case on an expedited basis. The port authority looks forward to working with the local communities and being a good neighbor throughout its development and operation of the Bayport Container and Cruise Terminal." In January, PHA and the Corps signed the federal permit for the Bayport project, marking a critical step in the process to build the $1.2 billion terminal. Construction of Phase 1A, including 1,660 feet of the ultimate 7,000 ft. wharf and approximately 65 acres of the ultimate 1,043 acre facility, is expected to begin soon with completion targeted in mid- to late 2006. Additional phases are planned to be built incrementally over several years according to market demands.

The Bayport Container and Cruise Terminal will result in the creation of thousands of new jobs and will add hundreds of millions of dollars to the region's economy. The modern facilities at Bayport will enable the PHA to provide efficient services to its existing and future customers.

The port authority has designed the terminal to minimize the effects its construction will have on the surrounding area, including setting aside approximately 1,100 acres of land for mitigation and the replacement of 19.7 acres of jurisdictional wetlands by a ratio of 3.4 to one.

Chairman Edmonds stated, "While this has been a long process, the system does work. All interested parties have had a voice in the process and their voices have been heard. As a result, we have a better project."

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