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TNPA presses ahead with MDS, defers Durban dig-out port development

TNPA presses ahead with MDS, defers Durban dig-out port development

Photo by Duane Daws

30th November 2015

By: Shirley le Guern

Creamer Media Correspondent

  

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The tide has turned for South African ports and the Transnet National Ports Authority (TNPA) is pressing ahead with its investment under Transnet’s Market Demand Strategy (MDS) notwithstanding poor economic growth.

TNPA CEO Richard Vallihu told a TNPA business-to-business gathering in Durban on Monday that the TNPA board had approved the R70-million upgrade of Pier 2 at the Durban Container Terminal.

Together with Durban port manager Moshe Motlohi and Durban Chamber of Commerce and Industry president Zeph Ndlovu, he stressed the importance of investing in “South Africa’s flagship port” if it was to remain competitive and claim back its place as the second largest port in Africa.

In light of ongoing port upgrades in Africa, the Port of Durban is now ranked first in sub-Saharan Africa but had slipped to third in Africa as a whole and fourth in the southern hemisphere.

Noting that the Chinese were actively and aggressively investing in African ports, Ndlovu warned that the Port of Durban could not rest on its laurels. “We must press ahead with the MDS to retain our competitive edge. If we postpone investment, it will be at our own peril,” he warned.

He noted that it was difficult in current economic times to supply additional capacity ahead of demand. However, he said decision-makers had to move beyond “just looking at accounting percentages”. Durban would need 25% “headroom” if it was to respond to challenges from other ports in Africa. 

At the same time, he said the existing port needed to optimise capacity and “sweat” its infrastructure and assets before it could call for more investment.

Although the TNPA said the Durban Dig Out Port would be delayed by a number of years, it did not specify by how many. 

Motlohi said the Durban port would see 15% container capacity growth by 2022/23 owing to improvements at Pier 2 and the Salisbury Island Infill which also had the go-ahead. This would be enough until 2025, if not 2030. Current capacity of about 3.1-million twenty-foot equivalent units (TEUs) would increase to 5.4-million TEUs.

He said TNPA expected to create and sustain 95 200 direct and indirect jobs in Durban. The latest estimated growth for 2015/16 was 6.9%.

He said the growth of the port hinged on a number of things including customers and shareholder centricity. “Meeting demand will retain volumes and attract new business which will generate revenue to continue investment in infrastructure as well as sustaining the ports contribution to the region’s economy,” he said.

He added that improving port efficiency in terminals and marine services would increase the smooth and effective flow of cargo and lower the cost of doing business.

“Money alone will not solve problems. It is not just about pouring concrete and steel,” he pointed out, stating that integration was important and that different divisions could no longer operate in silos. In addition, through its smart ports strategy, TNPA would now work very closely with external stakeholders. For example, TNPA would continue to engage with trucking companies to optimise time management and iron out “peaks and valleys”. 

Motlohi said that capital investment in the Port of Durban over the next seven years would be around R24-billion.

Referring back to 1977 when the Durban Container Terminal handled 1 000 TEUs using a 4 t wharf crane, he illustrated significant changes. In 2012, the DCT handled 11 312 TEUs with an 80 t ship-to-shore crane. This had compromised the stability of the quay wall. This needed to be strengthened and the berths deepened to accommodate fully laden larger ships.

He said there would be disruption as each berth would be “out for 18 months”. However, a plan was in place to divert 400 000 TEUs to other facilities.

Turning to the Salisbury Island infill, Motlohi said that the north quay would be lengthened to the sand bank to accommodate three ships instead of the current two. He said that agreement had been reached between TNPA, the City of Durban and the provincial Department of Environmental Affairs concerning mitigating the environmental impact of the project and TNPA would construct a new sand bank.

He said that work on berths 2, 5, 6, 7, 8 and 10 had been completed at Island View. Upgrades of fire fighting infrastructure was in the execution phase and due for completion in March 2018 while the upgrade of berth 1 was in the feasibility stage. Work was expected to commence in mid-2016 for completion at the end of 2019.

The upgrade of berth 4 was expected to start in mid-2021 for completion at the end of 2022.

He said Durban’s fleet upgrade was well under way with the new Ilembe dredger expected to arrive on January 15. The first new tug would be delivered in August 2016 and the second in November 2016.

Edited by Shirley le Guern
Creamer Media Correspondent

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