As part of its aim to begin coal exports for emerg- ing miners at the Richards Bay port, State-owned enterprise Transnet is nearing completion of the prefeasibility phase of the project’s development, which will be presented to its board in June for approval.
The project aims to provide export capacity of up to 32-million tons a year through a scalable, phased approach, which will provide capacity for about 14-millions tons a year of export coal during the first phase, planned for completion in 2020.
The State-owned enterprise is currently in the prefeasibility study (PFS) phase of Stage 2 of the project, which is being conducted by Transnet Capital Projects together with an external engineering consultancy.
The PFS will determine the viability of constructing a dedicated coal terminal within or just outside the Port of Richards Bay.
The final cost of the project will be determined by the next feasibility stage, where budget accuracy should be around 85%. The capital investment required for the completion of the terminal will also be revealed.
Should the feasibility studies show that an open-access coal terminal is a viable solution, construction will start in 2015 and will be completed by 2020, Transnet programme director of the project Sudesh Maharaj states.
The project is being undertaken as part of Transnet’s Market Demand Strategy (MDS), which aims to expand South Africa’s rail, port and pipelines infrastructure to drive a significant increase in the capability to handle growing freight volumes, especially commodities, such as iron-ore, coal and manganese.
The MDS has earmarked R300-billion in capital investment for these capacity development projects over a seven-year period, he adds.
The MDS will enable Transnet to contribute positively towards growing the economy by improving capacity at all major terminals, thereby facilitating greater volume throughput, unlocking demand and creating world-class rail and port operations through improved efficiencies.
“An open-access coal terminal is a medium- to long-term solution to unlock coal exports for emerging miners looking for export solutions. Transnet is also currently in discussions with the Richards Bay Coal Terminal to provide additional export capacity at the terminal as a potential short-term solution for emerging miners,” Maharaj notes.
“It is expected that the expansion of the Richards Bay port will have far-reaching benefits for the Zululand area of KwaZulu-Natal. Aside from improving the efficiency of the port and increasing its commercial competitiveness, local businesses will have an opportunity to participate in supply-chain and spin-off opportunities arising from increased activity at the port.”
Global demand for mineral resources, particularly coal, is forecast to continue growing over the coming years, driven largely by an increase in demand from India and China, Maharaj adds.
Boosting rail and port capacity is one of the key enablers towards increasing mining capacity, which will create long-term employment, attract foreign direct investment and increase revenue for Transnet, its customers and the State, he concludes.