The Richards Bay Coal Terminal (RBCT) phase V expansion programme was not progressed as expected, owing to Transnet Freight Rail’s (TFR) non-performance in meeting the terminal's rail capacity requirements, said RBCT CE Raymond Chirwa in a statement released on Monday.

“This bottleneck has delayed the integration of black players into the system and has threatened our competitiveness, a situation we cannot permit,” he noted.

“More than 80% of our coal exports land in Europe and the Indian sub-continent.

“Government, existing shareholders and ourselves are keen to ensure entrants share in these lucrative markets and become a part of the South African coal story.”

Chirwa said TFR admitted that it had not delivered on its mandate, and that it was now engaging with industry and drawing in additional technical resources in order to ramp up capacity.

“We do realise that growing our coal exports requires a collaborative effort. RBCT and its shareholders are appreciative of TFR’s genuine efforts to finding a solution to the problem of limited throughput capacity while also fast-tracking the social agenda,” he noted.

Of key importance were clearing up bottlenecks and improving scheduling and efficiencies.

PHASE V

RBCT's R1,2-billion phase V expansion will be rolled out from April next year, on an existing terminal control computer system.

Once completed, the increased capacity is expected to earn South Africa more than R6-billion in foreign exchange revenues. 

The terminal will increase throughput capacity from 76-million tons a year to 91-million tons a year, consolidating Richards Bay’s position as the single largest export coal terminal in the world.

“RBCT has embarked on technically commissioning of phase V . . . at the latest, by the end of the first quarter of 2010,” said Chirwa.

This meant the terminal capacity will be 81-million tons by the end of December, progressing towards 91-million tons during the first quarter next year.

“The phase V project has delivered on everything except for the new terminal control system with which we have had challenges,” said Chirwa.

“We are working on systems integration, which admittedly is taking time.”

Nine million-tons a year of expansion capacity had been offered to, among others, commercial users with black economic empowerment priority. 

Mbokondo, Umcebo, Exxaro and South African Coal Mining Holdings had concluded agreements with RBCT and were ready to rail coal, while Worldwide Coal Carolina, Mmakau, Arm Coal, Tumelo and South Dunes Coal Terminal agreements were in the final stages of preparation.

“It is my belief that the remaining agreements will be concluded before the end of December 2009 so that all new exporters will join the existing shareholders in exporting coal as early as January 2010,” said Chirwa.

“I commend the existing RBCT shareholders for walking the talk. They have curtailed their export capacity to the new entrants, a bold, magnanimous and commendable step that accentuates their commitment to the transformation agenda and the success of a workable venture,” he added.

“In 2004, less than 1% of RBCT was black-owned. This will rise to more than 30% when the terminal reaches a capacity of 91-million tons.”

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