How to create categories in Portfolio

Hello Guy!

I would like to ask for your help….please see the code below:

<?php
add_action(‘init’, ‘create_portfolio’);
function create_portfolio() {
$portfolio_args = array(
‘label’ => __(‘Portfolio’),
‘singular_label’ => __(‘Portfolio’),
‘public’ => true,
‘show_ui’ => true,
‘capability_type’ => ‘post’,
‘hierarchical’ => false,
‘rewrite’ => true,
‘supports’ => array(‘title’, ‘editor’, ‘thumbnail’)
);
register_post_type(‘portfolio’,$portfolio_args);
}
?>

<?php
add_action(“admin_init”, “add_portfolio”);
add_action(‘save_post’, ‘update_website_url’);
function add_portfolio(){
add_meta_box(“portfolio_details”, “Portfolio Options”, “portfolio_options”, “portfolio”, “normal”, “low”);
}
function portfolio_options(){
global $post;
$custom = get_post_custom($post->ID);
$website_url = $custom[“website_url”][0];
?>
<div id=”portfolio-options”>
<label>Website URL:</label><input name=”website_url” value=”<?php echo $website_url; ?>” />
</div><!–end portfolio-options–>
<?php
}
function update_website_url(){
global $post;
update_post_meta($post->ID, “website_url”, $_POST[“website_url”]);
}
?>

<?php
add_filter(“manage_edit-portfolio_columns”, “portfolio_edit_columns”);
add_action(“manage_posts_custom_column”, “portfolio_columns_display”);

function portfolio_edit_columns($portfolio_columns){
$portfolio_columns = array(
“cb” => “<input type=\”checkbox\” />”,
“title” => “Project Title”,
“description” => “Description”,
);
return $portfolio_columns;
}

function portfolio_columns_display($portfolio_columns){
switch ($portfolio_columns)
{
case “description”:
the_excerpt();
break;
}
}
?>

In my portfolio have Add New (Post), how to add categories?…

Thanks!!! ??