The Gulf Coast Advantage: A Regional Approach to

Marketing & Preparing for the Panama Canal Expansion

Largest, most diversified port in Florida

$8B in economic impact/supports nearly 100,000 jobs

Largest economic engine in West Florida

Solid financial performance, even during economic downturn

Encompasses 5,000 acres

Approx. 40M tons cargo/year—nearly 40% of FL waterborne trade

Energy products gateway of West/Central Florida-critical to economy

Premier U.S. fertilizer port

Large/diverse bulk and break bulk business

Shipyard/ship repair center

Top ten cruise homeport—Carnival, RCI, HAL, NCL

Expanding container/distribution center gateway

Petroleum Cruise Phosphate Building Materials Containers

Port of Tampa

Containers Concentrate In Population Centers

Estimated Market Shares

Far East to USEC/Gulf

2010 1990 1983 1976

Mini-Landbridge 65% 80% 30% 15%

All-Water 35% 20% 70% 85%

Lock Chamber

Length: 427 m

Width: 55 m

Depth: 18.3 m

Vessel size

LOA: 366 m

Beam: 49 m

Draft: 15.2 m

Panama Canal Expansion

Logistics & Supply Chain Implications

Distribution Strategies

Cost & Transit Time Considerations

Commodity Sensitivities

While ocean carriers seek to reduce their

costs, including through larger ships/economies

of scale, ultimately, exporters and importers

determine cargo routing by optimizing their

supply chains

Distance Comparison

SHANGHAI

PANAMA CANAL

NEW YORK LOS ANGELES 5699 miles

8566 miles

Ocean Carriers’ Economics & Perspective

Larger ships + economies of scale

Profitability vs market share strategy

Inability to raise rates to a compensatory levels

Focus on lowering operating costs

Larger ships

Slow steaming

Minimize inland rail/trucking costs

Global Container Shipping Industry Profit/Loss

2009 – 2012 (US$ Billions)

Source: AXS Alphaliner

Cargo Owners’ Economics & Perspective

* Diversify route options and minimize exposure

* Geography does not change, despite Canal expansion *All water delivery China to US Midwest via east coast vs west

coast/intermodal = extra 7+ days transit time

*Lower value/seasonal vs higher value/time sensitive

* Transloading

* Ultimately cargo owners (importers and exporters) drive cargo flows and determine routings – not ocean carriers

46%* 63%*

4000 TEU ship 8000 TEU ship

* Share of the US population

Assumptions

• $400/MT bunker

• Canal tolls based on 2011

proposal

• Current ship charter rates

• Inland move by rail

• Left of the black line = West Coast has the cost advantage

• Right of the black line = East Coast has the cost advantage

For a typical Asia-USEC voyage,

shifting to an 8000 TEU vessel

expands the market reach of the

USEC ports

Waterside & Landside Access

*How deep is deep enough?

*East Coast & Gulf Coast

*Transshipment will play a role

*Deep water is important but efficient road and rail

access to customers is key

Tampa•

Kingston•

Colon/MIT•

•

Caucedo

•Cartagena

•Freeport

Mexico

South America

United States

Caribbean Transshipment Triangle

Increase from 235K TEUs in 1996 to 6.5M TEUs in 2011

Panama Container Terminals

Puerto Barrios

326K

1

Santo Tomás

392K

1

Puerto Cortes

583K

2

Puerto Quetzal

583K

0

Freeport 1,125K

16

Caucedo 1,004K

5

Haina

288K

3

Kingston

1,891K

19

Acajutla

145K

0

Limon /Moin

858K

1

MIT/CCT/Cristobal

2,810K

34

Balboa/PSA

2,758K

25

Cartagena

1,581K

12

La Guaira

333K

5

Puerto Cabello

800K

0

Caldera

155K

0

Port name

Movement in TEUs

Quay cranes

Profile of main ports in the region (movements in ‘000 of TEUs for 2010 and number of quay cranes)

La Habana 228K

0

Barranquilla

103K

0

Buenaventura

662K

4

Port Spain

389K

5

Point Lisas

184K

2

Jarry

150K

4

Tampa among the deepest draft ports

in Florida and along the Gulf Coast

STATE

PORT

REPORTED

CHANNEL DEPTH

Florida Tampa 43

Jacksonville 40

Miami 42

Port Manatee 40

Port Everglades 42

Alabama Mobile 45

Louisiana New Orleans 40

Texas Houston 40

Container Terminal Expansion

Currently 40 acres; expansion to 160 acres planned

4 container cranes; 2 more under consideration

43 foot deepwater channel/berths

Plans to quadruple capacity; enough to handle all Cent. FL demand

Tampa Gateway Rail Project

• Joint TPA-CSX multi-modal initiative

• Florida’s only on-dock unit train terminal

• Ethanol, containers, other cargo

• Scheduled for completion in 2012

I-4 Connector Project Elevated express highway access between Port and Interstate

System, scheduled for completion summer 2013

Dedicated Truck Lane

20

21

*

* Three strong, distinct, complementary markets

* Proximity to expanded Panama Canal

* Balanced trade characterized by robust exports to multiple lanes

* Expanding logistics gateways, distribution centers and industrial parks driving cargo density

* Extensive terminal facilities on deep water, with plans for additional expansion

* D E M O G R A P H I

C S

22

• Combined population of 97.2 Million. 32% of the U.S. population

• Fastest population growth in the U.S.

• Combined GDP of US$4.1 Trillion. 29% of U.S. Gross Domestic Product

• Access to major hubs like Dallas/Ft. Worth, New Orleans, Memphis, Atlanta and Orlando in 8 hours or less

* C O S T S A V I N G S

& R E V E N U E

E A R N I N G O P P O

R T U N I T Y

23

• Shipping via the Panama Canal is less costly than USWC rail or via the Suez Canal

• Shorter nautical miles from Asia as compared to USEC ports, a 15% savings from Panama Canal

• Eliminates mini-land bridge cost

• Balanced import / export trade allows for even matchback to multiple trades

• Higher terminal efficiency levels with favorable labor environment

• No local port or terminal fees related to clean air, congestion or capital improvement

• Traditionally, a higher revenue market

Panama - US Gulf R/T mileage

Colon Houston 1,539

Houston Mobile 539

Mobile Tampa 386

Tampa Colon 1,216

total distance 3,680

Versus

Panama - USEC R/T mileage

Colon Savannah 1,563

Savannah Norfolk 503

Norfolk NY 294

NY Colon 1,974

total distance 4,334

Source: Panama Canal Authority

The Gulf Coast Advantage:

654 mile reduction or -15%

24

O U R B U S I N E S S

HOUSTON MOBILE TAMPA

Top Importers Top Import

Commodities Top Importers

Top Import

Commodities Top Importers

Top Import

Commodities

Wal-Mart GDSM Honda, Hyundai, Kia,

Mercedes , Nissan,

Toyota

Auto Parts Rooms to Go Furniture

The Home Depot Home Improvement Big Lots,

Dollar General GDSM Beall's

General

Merchandise

Fox Conn / Hon Hai Electronics Standard Furniture Furniture Publix Grocery Products

Ashley Furniture Furniture Evonik Chemicals Lowe's Building Materials

Crown Mark Furniture CAFFCO Art Flowers Pepsico/Tropicana Juice Concentrate

Top Exporters Top Export

Commodities Top Exporters

Top Export

Commodities Top Exporters

Top Export

Commodities

Shintech Resin Sabic Resins Amalie Engine Lubricants

ExxonMobil Chemicals GP Cellulose, IP Forest Products Sysco Food Products

JBS / Swift Frozen Meat Ascend Performance

Materials Chemicals

Coca Cola/

Minute Maid Frozen Citrus Pulp

Noble Cotton Cotton Tyson, Pilgrims,

Sanderson Frozen Poultry Mosaic Feed Supplements

Halliburton OWS Staplcotn Cotton Citrus World Frozen Citrus Pulp

25

*9 Million + TEUs potential

*Attractive alternative to the USWC / USEC

*Large and under-served market

*Lower cost

*Terminal expansion projects in progress

*A new frontier

The Gulf Coast Advantage: A NEW BUSINESS

OPPORTUNITY

Thank You!