Django, Postgres, Docker - Can not run migrations on database on ubuntu 14.04 python 2.7.11

I'm using the same docker-compose file to run an environment with django and postgresql.

When I run the environment on my local virtual machine (using docker-machine virtualbox driver and boot2docker distribution) and run migrations or tests it all works.

Deploying the exact same environment to digitalOcean running ubutu 14.04 I can't run migrations or tests.

Both environments run Django 1.8 and postgres 9.4.5.

The portal container runs on the ubuntu dist runs python 2.7.11 and the portal container on the boot2docker runs python 2.7.10

I can connect to the DB from django manually but for some reason trying to run the migrations or tests just stops after some time period.

The postgres sql logs not showing any error and the python process also not throwing any exceptions.

Every time I try to run the migrations, The process stops on the next line:

Creating test database for alias 'default'...

And then just exists.

I'm not sure what am I missing.

my docker-compose file:

portal:
  build: ./portal/
  ports:
    - "80"
  container_name: portal
  env_file: ./portal/.env
  links:
    - postgres:postgres
  command: waitress-serve --port=80  --threads=10 ltgss.wsgi:application


postgres:
 restart: always
 image: postgres:latest
 environment:
   POSTGRES_PASSWORD: 12345
   POSTGRES_USER: test
 container_name: postgres
 ports:
   - "5432:5432"

Thanks.