The Dilemma Facing NSW in Identifying Additional Cruise Ship Terminals

February 2026

It’s a vexing question. Where to add additional berthing for the burgeoning cruise industry for vessels both homeported, for example Carnival Cruises, (although in most cases home porting means cruise lines placing a ship in the Australian market for anywhere from three to six months out of twelve) and those passing through on extended voyages beyond our shores.

The latter is fairly straight forward, Sydney Harbour provides three cruise terminals, two fairly basic terminals at White Bay and of course the more prestigious Circular Quay International Cruise Terminal. White Bay of course is limited by cruise ships that can pass beneath the iconic Sydney Harbour Bridge. With cruise ships growing in ever-increasing size, the number of vessels able to utilize White Bay is decreasing.

Several points must be considered as pressure mounts to resolve the burning issue of how to accommodate the increasing demand for cruise ship berths within the Sydney region.

1. Is the so-called growing demand really sustainable? International cruise lines have already demonstrated that they, rightfully, are in the business of maximizing profits to sustain the business and of course on behalf of investors. They deploy their assets wherever the best return on investment presents itself.

2. Major ports around Australia have already signaled projected significant increases in port charges that on the global scene are already considered to be well above international norms. This has already led to a major decrease in the placement of cruise ships in Australian waters over the traditional 2026-27 cruise season, estimated at a 35% decrease over the 24-25 season by the peak body, the CLIA thereby already somewhat alleviating pressure on cruise terminal demand. Several major cruise lines have announced their withdrawal from Australia, for example Disney and Cunard, while others have reduced the number of vessels they will place in the Australian market. Will this trend continue into future years after heavy investment has been made in accommodating presumed demand, only to find those new expensive berths become under-utilised?

3. Why is one of our nation’s largest naval bases still located right in the centre of one of the most densely populated commercial and financial centres of our country? Surely this presents a sitting target for any belligerent country to destroy two birds with one stone. Not to mention two of Australia’s most beloved icons, the Opera house and Harbour Bridge. Why hasn’t common sense prevailed and the naval facilities diversified to areas where the consequence of any successful attack would have a far less devasting impact on the civilian population? For example Port Kembla, Newcastle or an extended Jarvis Bay. Yes, the Garden Island graving dock and ship maintenance facility would be prohibitively expensive to duplicate elsewhere, but maybe that could still remain, but free up the other half on Woolloomooloo Bay where naval vessels now berth between operations.

4. Current options under consideration for a new turn-around passenger terminal seem to be drifting towards regional ports, in particular Port Kembla, one and a half hours by road from Sydney’s Mascot International and Domestic Airport, or around two hours by rail, including two train line changes. From the soon to be operational Western Sydney International Airport the road distance is much the same, however at this stage there are no direct public transport services. I suspect that the rail journey, via Sydney CBD would result in a transit time to Port Kembla somewhere around three to three and one half hours and be quite expensive. Many proponents of the Port Kembla option will point to other major cities where a similar distance from a capital city exists. Think Rome to Cittivecchia or London to Southampton. Both cities are located well inland from the coast so there really is no convenient port option, but not so with Sydney’s incredible harbour, so I find it difficult to make that comparison as an excuse for a distant regional home port for cruise ships.

5. Accessibility is an important consideration already mentioned above. Sydney city is the central point for existing port facilities, equally drawing intending passengers from the city’s burgeoning suburban catchment and from north, south and western regions further afield as well. Excellent public transport and road infrastructure make it accessible to all. I suspect that a very significant proportion of NSW cruise passengers are drawn from north and west of the Sydney catchment area which makes having to travel down to Port Kembla even more expensive and difficult.

So the question is, will the NSW Government yield to the vested interests of a remote regional city, itself strongly lobbying on behalf of local business growth, rather than seriously consider the inconvenience and additional transport costs their choice would place on the many tens of thousands of future cruise passengers? It's time the State Government had direct dialogue with the Federal Government about relinquishing even just the few berths sitting on the western side of the naval facilities at Woolloomooloo. Not to mention the continued presences of one of Australia's major defence facilities right in the middle of the Sydney CBD.

Preserving Nautical History

Due to the Covid-19 pandemic many fine passenger ships sadly wound up on the beaches of ship-breaking nations such as India, Turkey, Bangladesh and Pakistan, collateral damage due to a global disaster that no-one saw coming.

Whilst impossible to preserve all these fine examples of liners and cruise ships of another era, it is sad to think that at least a couple of the better-known ships might have been spared from destruction, even if given a new lease of life in a new career. But financial survival is the main game being played by cruise lines at the moment, and scrap metal prices are bouyant enough to attract them to the less emotional decision to be rid of them forever.

Every time another sleek, beautiful vessel is converted into razor blades and Volkswagens, a little bit of me dies. I long for the days when I could look at the lines of a vessel, not just a liner but any ship, and say that is truly a work of art. The sheer beauty created by talented naval architects of the day was a treasure to behold. And now, its function over form. Yes, there are some smaller luxury vessels still being designed with pleasing lines, but the commercial rule of law now dictates that there is no place for eye-catching cruise ship designs, just layer upon layer of small flats pancaked over each other with a low freeboard hull to support them. One wonders how they stay upright!

The big question now is, given that some rare examples of bygone beauty currently preserved are struggling to survive, who should be responsible for maintaining their continued existence in a world where the mighty dollar is god? Yes, among others I am referring to the Queen Mary, the Duolos and the United States as just a few examples of the stately vessels of yesteryear that seem to live on borrowed time with the Sword of Damocles hanging over their rusting boat decks.

And now I hear of another historic ship, the NS Savannah, the very first nuclear powered commercial vessel, launched in 1959, is to have her fate reviewed. Managed by the US Maritime Administration (MARAD), NS Savannah has up to now been a floating museum ship docked in Baltimore USA ever since her decommissioning in 1970 when her nuclear reactor was removed. Owing to her sleek design she had not been a commercial success up to that point, but had been preserved within the National Defense Reserve Fleet and was registered as a National Historic Landmark in 1991.

Now MARAD have released a public document requesting suggestions for the future of this historic ship. Fortunately there are specific obligations to preserve the vessel as a result of her NHL registration, but several of the suggestions put forward for discussion indicate her future would be very much dependent upon another party throwing the big bucks at her. And we all know where that ends up, sooner or later.

One option suggests NS Savannah could be chartered out and another suggests a public-private partnership between MARAD and a private operator, or alternatively a semi-government entity. A further option suggests she be could be handed over to a statutory authority or not for profit as long as preservation is guaranteed. In either of these scenarios NS Savannah would have to remain static as to re-engine her with conventional options would would be extremely expensive, if not impossible.

The other option, which sends shivers down my spine, is that she either be sunk as an artificial reef or sold to breakers. This would truly be a tragic end to one of the most remarkable ships of the Post-War era.

So the question is, who should take resonsibility for her? Is it a government entity, such as MARAD itself or one of the semi-government authorities? Or like other ventures that seem to struggle from one drama to the next, should she be the responsibility of some adventurous entrepreneur until eventually there is no-one left to keep her going?

Personally, I hope she remains in the hands of the public sector, otherwise her eventaul fate is already sealed.

Covid-19: Can the Mega-Cruise Ship Survive?

First let me say that I am really disappointing that the cruise industry has been the target of such a beating in the press over the past few months since the then named "Coronavirus" broke out of China and it dawned on the world that we now faced a lethal pandemic.

It might be argued by some that cruise lines had only themselves to blame for the consequences of not having their finger on the pulse and become proactive much sooner, but that is a discussion for another day, but personally I think that to some extent they have just served as a target for media beatup.

No-one disputes that when people are confined in close proximity, anyone with a virus will rapidly spread it to the remainder, regardless of the location be it a room, aircraft, train carriage, office etc.

So applied to the cruise industry, the larger the capacity of a cruise ship the more likelihood of mass infection from any disease going around. You squeeze more people into a relatively confined space, and the flame becomes a fire.

Pre-covid, you could readily blame the spread of such diseases as the common flu and Norovirus on a small percentage of the passengers themselves, not the ship or the cruise line. It prompts me to remember that prior to the advent of the super-sized cruise ship, no-one on any voyage I took ever contracted much more than a cold. In fact, to support that observation very recently I returned from a ship that had around 600 passengers onboard and had travelled half way round the world for over 50 days with not so much as a cold among them. Good luck? No, just good hygiene practices.

It prompts me at this point to add that I am continually disgusted by the appalling personal hygiene of a number of those onboard the larger ships I travel on who refuse to wash their hands after going to the toilet, or consider it quite acceptable to cough or sneeze in someone's face, or indeed over their food at the table. This, the ship's crew have absolutely no control over, you can only make so many public announcements and print warnings so many times in the ship's daily newspaper. As far as I am aware, you can't throw the culprits overboard for poor personal hygiene. In the case of a flu virus, most likely brought onboard by a passenger determined not to waste a moment of their holiday by self-imposed isolation, the thought that their selfish behavior might ruin the cruise for a significant number of their fellow passengers is the very last thing they care about.

But I digress (as I so often seem to do), here right now we have a very different and more serious problem because it can very well be lethal.

The cruise line peak body, the CLIA has drawn up a code of practice to be adhered to as the industry claws its way back to some form of new normality. That includes a fundamental new approach to the embarkation day process, the manner in which guests are served at meal times, safe distancing practices, and medical procedures and processes if a passenger falls ill during the cruise.

One interesting aspect of the proposed CLIA approach is a percentage reduction in the carrying capacity of cruise ships, although no number from the maximum the vessel is licensed to carry has been formulated as far as I'm aware. But the stand-out here is - reduced capacity, and therefor by logical extension, reduced revenues not just from fares, but by the never-endingly critical onboard revenue. (When will the cruise line's thirst be quenched I ask myself?).

I'm certainly no naval architect or bean counter, but taking a simplistic view I assume that the size of the investment in a new vessel is somehow linked to the projected amount of revenue it will generate over a pre-determined period of ownership, with the average passenger load factor and average onboard spend therefor derived per passenger. Of course there are many other variables to be taken into account, but let's keep it simple eh?

So, to my way of thinking, the bigger the vessel the higher the overall cost, both fixed and variable. The larger the vessel, the higher operational expenses become, for example fuel, pilotage and channel fees, wharfage fees, maintenance and so on, all based on the size of the ship. So, if the percentage reduction to be enforced in passenger numbers post-covid is a constant across all sizes of vessels, then the losses are far greater at the higher end of the vessel size employed in cruising. In other words, the larger the ship the larger the profit gap if you have to reduce passenger capacity.

So, if this the new reality for cruise lines, it seems logical that the larger vessels in the fleet would be a liability, and smaller capacity ships the better option. What that looks like I am not qualified to say, but a capacity of around 1,500 to 1,900 passengers seems to me like a place to start. It could be more, it could be less.

A quick look at the list of planned ship orders over the next 7 years reveals an increasing trend towards smaller capacity cruise ships, particularly by boutique operators intentionally distinguishing their brands from the major mass market cruise lines with their ever-increasing vessel sizes.

Maybe it's time for the larger cruise lines with their floating Hyatt Hotel clones cross-pollinated with Disneyland rides to rethink their strategy?

A Tour of the Port of Brisbane

I recently had the opportunity to undertake a tour of the ever-expanding Port of Brisbane, which reinforced my long-held belief that at some stage in the foreseeable future, Brisbane will be a viable contender for Australia's premier port.

Unlike other East Coast ports, Brisbane has the luxury to grow unimpeded by the issues that constrain port expansion elsewhere, such as room to build more berth length and growing criticism from various pressure groups.

Brisbane's capacity to meet growing demand for box lifts and dry bulk cargoes is easily achieved through developing more berth length and allied infrastructure further out into Moreton Bay with reclamation projects, a luxury that other major capital city-based Australian ports do not have. Ecological offsets are also easily achieved by incorporating sanctuaries within the port boundaries.

Current channel depth is 15metres, and the PBPL has the ability to deepen the channel to meet future needs as vessel size increases. This is a challenge in particular for the Port of Melbourne, currently Australia's premier handling port. Opposition to port growth is also a burning issue in both Sydney, Botany Bay and Melbourne.

A further opportunity is looming with the current construction of an "Inland Rail" route between Brisbane, Sydney and directly to Melbourne. Box cargoes in particular would benefit from much quicker transit times to southern destinations, and save shipping lines the added cost of having to steam around the Australian coast.

Port Protests

There is increasing noise from various local government authorities and Green activists in regard to the increase in cruise ship calls to various ports around the world, but most particularly in Europe which they say is not only degrading the atmosphere with SO2 - sulphur particles- but with the increasing number of passengers crowding the city streets.

Some cities, such as Amsterdam have imposed a head tax on each passenger aboard a visiting cruise ship, a trend that is likely to find further favour with other destinations, although in Amsterdam's case, the move resulted in most cruise ship companies deleting the city from future itineraries.

As an alternative Santorini and Dubrovnik, amongst several other destinations, has imposed a limit on the number of passenger ship calls on any given day

In response to the growing problem, shipowners are adopting a number of sulphur-reducing strategies:

1- retro-fitting "emission scrubbers" inside the vessel's engine exhaust systems to remove pollutants

2- converting or ordering new vessels engines to run on LNG and other bio-fuels

3- fitting equipment on vessels to accommodate "cold ironing", the technique by which ships shut down their engines in port and connect to the local electricity grid

4- preparing vessels engines to run on a soon-to-be-introduced mandate that all vessels must only use marine fuel with a sulphur content of 0.5%, as opposed to the current maximum level of 3.5% content. This International Maritime Organisation order comes into effect in 2020.

It is worth noting that the Australian Maritime Safety Authority (AMSA) mandated immediate compliance with points 1-3 within Sydney Harbour for all cruise vessels with over 100 passengers in 2018, but imposed a further sulphur reduction to 0.10%.

Hopefully the combination of strategies listed above will go a long way to meet the expectations of critics, however the issue of large passenger numbers is a double-edge sword for those who would complain of overcrowding as a large number of these ports rely heavily on the economic benefit derived from visitors and ancillary port and supplier charges, and in the majority of cases the income-generating season only lasts for 6 months of the year in each hemisphere.