Works for me, I see http://ports.ubuntu.com/ubuntu-ports is now passed to debootstrap.

The install however subsequently fails because of the security mirror URL being wront:
2008-11-02 10:17:44,855 INFO     Installing guest operating system. This might take some time...
2008-11-02 10:19:59,421 INFO     W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/main/binary-lpia/Packages.gz  404 Not Found
2008-11-02 10:19:59,422 INFO     
2008-11-02 10:19:59,423 INFO     W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/restricted/binary-lpia/Packages.gz  404 Not Found
2008-11-02 10:19:59,423 INFO     
2008-11-02 10:19:59,423 INFO     W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/universe/binary-lpia/Packages.gz  404 Not Found
2008-11-02 10:19:59,424 INFO     
2008-11-02 10:19:59,424 INFO     E: Some index files failed to download, they have been ignored, or old ones used instead.
2008-11-02 10:19:59,424 INFO     Cleaning up
Traceback (most recent call last):
  File "/usr/bin/ubuntu-vm-builder", line 29, in <module>
    VMBuilder.run()
  File "/home/lool/bzr/launchpad/~nijaba/vmbuilder/arch-lp291782/VMBuilder/__init__.py", line 66, in run
    frontend.run()
  File "/home/lool/bzr/launchpad/~nijaba/vmbuilder/arch-lp291782/VMBuilder/plugins/cli/__init__.py", line 67, in run
    vm.create()
  File "/home/lool/bzr/launchpad/~nijaba/vmbuilder/arch-lp291782/VMBuilder/vm.py", line 453, in create
    raise e
VMBuilder.exception.VMBuilderException: Process (['chroot', '/home/lool/uvb2/vmbuilderq4qto-/root', 'apt-get', 'update']) returned 100. stdout: Get:1 http://ports.ubuntu.com intrepid Release.gpg [189B]
Get:2 http://security.ubuntu.com intrepid-security Release.gpg [189B]
Get:3 http://ports.ubuntu.com intrepid-updates Release.gpg [189B]
Get:4 http://ports.ubuntu.com intrepid-security Release.gpg [189B]
Get:5 http://security.ubuntu.com intrepid-security Release [44.0kB]
Hit http://ports.ubuntu.com intrepid Release
Get:6 http://ports.ubuntu.com intrepid-updates Release [44.0kB]
Ign http://security.ubuntu.com intrepid-security/main Packages
Ign http://security.ubuntu.com intrepid-security/restricted Packages
Ign http://security.ubuntu.com intrepid-security/universe Packages
Err http://security.ubuntu.com intrepid-security/main Packages
  404 Not Found
Err http://security.ubuntu.com intrepid-security/restricted Packages
  404 Not Found
Err http://security.ubuntu.com intrepid-security/universe Packages
  404 Not Found
Get:7 http://ports.ubuntu.com intrepid-security Release [44.0kB]
Hit http://ports.ubuntu.com intrepid/main Packages
Get:8 http://ports.ubuntu.com intrepid/restricted Packages [1780B]
Get:9 http://ports.ubuntu.com intrepid/universe Packages [4423kB]
Get:10 http://ports.ubuntu.com intrepid-updates/main Packages [2653B]
Get:11 http://ports.ubuntu.com intrepid-updates/restricted Packages [14B]
Get:12 http://ports.ubuntu.com intrepid-updates/universe Packages [14B]
Get:13 http://ports.ubuntu.com intrepid-security/main Packages [2653B]
Get:14 http://ports.ubuntu.com intrepid-security/restricted Packages [14B]
Get:15 http://ports.ubuntu.com intrepid-security/universe Packages [14B]
Fetched 4563kB in 1min6s (68.7kB/s)
, stderr: W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/main/binary-lpia/Packages.gz  404 Not Found

W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/restricted/binary-lpia/Packages.gz  404 Not Found

W: Failed to fetch http://security.ubuntu.com/ubuntu/dists/intrepid-security/universe/binary-lpia/Packages.gz  404 Not Found

E: Some index files failed to download, they have been ignored, or old ones used instead.