The threat to Dún Laoghaire's future as a ferryport has been lifted with the signing of a €50 million deal between Stena Line and Dún Laoghaire Harbour Company.
The contract, which involves a cut in harbour dues of over €1 million annually, aims to secure the ferryport's role in Stena's HSS fast-ferry Irish Sea link for the next seven years.
Neither Stena Line nor Dún Laoghaire Harbour Company would confirm the cut in rates yesterday, but Mr Michael Hanahoe, chief executive of the harbour company, said negotiations were "premised on the basis that the new arrangement would be profitable for both parties", and "recognised that the ferry market had been declining due to the competition from low- cost airlines".
Stena runs its conventional ferry from Dublin Port, and there had been speculation that it might move the HSS across the bay if it could not secure a satisfactory deal with Dún Laoghaire.
This would have broken a link with Britain, dating back to 1826, and would have represented a major blow to the borough and to the harbour company, which depends for 70 per cent of its income on the ferry link - reduced from a 100 per cent dependence when the port became a corporate entity.
Stena Line has carried 10 million passengers on the Stena Explorer since the HSS was introduced eight years ago.
Mr Hanahoe told The Irish Times that the company hopes dependence on the ferry business will be reduced when it completes development of the Carlisle Pier and a separate plan for its harbour yard.
Its marina is understood to have been loss-making, but the company earns some €600,000 annually from its pay and display car parking.
The harbour company has an annual turnover of €11 million and all of its revenue is invested back into Dún Laoghaire, Mr Hanahoe emphasises. It plans to spend €3 million on resurfacing the East pier.
This follows the discovery of major erosion last year on the West and East piers at an estimated remedial cost of €10 million.
The new agreement replaces the existing ferry contract which was due to expire in 2006.
