Name and Location
Durban port upgrade and expansion project, KwaZulu-Natal, South Africa.

Client
The Transnet National Ports Authority (TNPA) and Transnet Port Terminals (TPT), divisions of freight logistics company Transnet.

Project Description
The Durban Container Terminal (DCT) is the biggest and busiest in the southern hemisphere and currently handles 64% of the country’s seaborne container traffic.

Transnet is implementing an ambitious expansion project at the Durban port and its container terminals, comprising several individual work packages, aimed at increasing the DCT’s container-handling capacity.

The main projects include the expansion of the DCT Pier 1, which will increase the capacity of the terminal from 700 000 twenty-foot equivalent units (TEUs) to 820 000 TEUs by 2013 and eventually to 1.2-million TEUs by 2016/17.

In addition, the North quay at DCT Pier 2 will be extended to increase the capacity from 2.1-million TEUs in 2011/12 to 2.5-million TEUs by 2013/14 and to 3.3-million TEUs by 2017/18.

Container capacity is also being created at other terminals, such as the Durban Ro-Ro and Maydon Wharf terminals, through the acquisition of new equipment, including mobile cranes and various infrastructure upgrades.

Transnet is further proposing the phased development of a new dig-out port on the old Durban International Airport (DIA) site.

Value
The project forms part of an initial five-year R110.5-billion capital expenditure programme until 2015/16 and the group’s larger R307-billion seven-year Market Demand Strategy (MDS) until 2018/19.

However, funding for the new port at the DIA is not included in the strategy.

Transnet has indicated that it is in the final stages of appointing a transaction adviser and is considering various funding options and models for private-sector participation in the project.

Duration
Ongoing.

Latest Developments
Transnet, which is studying the development of a proposed dig-out port at the old Durban International Airport site, aims to finalise an engineering solution for the relocation of the single buoy mooring (SBM) oil loading facility by early next year, having identified its repositioning as critical to meeting the project’s overall timeline.

Under the current schedule, it is envisaged that the Durban Dig-out Port (DDOP), which could be developed in several phases at an expected cost of more than R100-billion, would receive vessels from 2020.

The initiative is being marketed as a public–private partnership (PPP) opportunity and, should it proceed, could become Africa's largest deep-water container terminal, capable of handling 9.6-million twenty-foot-equivalent units (TEUs) through 16 berths by 2037.

However, executive manager for planning support Noel Cronje has told delegates at a South African Petroleum Industry Association conference that the current SBM terminal is located precisely where the DDOP’s breakwater will be developed and its relocation is, thus, unavoidable.

Various alternative sites and potential new pipeline routes are under review, with uninterrupted liquid-fuel supply having been identified as a project imperative. “The SBM is a very critical piece of infrastructure not just for Transnet and not just for Sapref and other oil refineries, but for the whole country, because the vast majority of crude oil that’s imported into South Africa comes ashore via the SBM,” Cronje explains.

It is, therefore, unlikely that the existing SBM can simply be relocated, as the reliability of the new facility will have to be proved before the existing SBM can be decommissioned. “That places us under some time pressure, which is why we need to identify a new site and establish a new import route as soon as possible,” Cronje says, adding that initial studies have shown positives and negatives for the various alternatives.

Practitioners are being appointed to oversee the environmental-impact assessment (EIA) associated with the SBM project, with Transnet hoping for a favourable record of decision by the end of 2014. The process will be run in parallel to the EIA being conducted for the entire DDOP, which has already run into some opposition from environmental and community groups.

The project is currently in the prefeasibility-study phase, with the SBM relocation having been incorporated as an “early deliverable” within the study.

Transnet aims to finalise the PPP financing model by the end of 2014 and has already started canvassing support for the project abroad, with investor roadshows to Europe and Asia.

The port will also need to be promulgated, which could entail the introduction of new legislation, while properties, other than that which has already been bought from the Airports Company South Africa, will also have to be acquired to enable the construction of the harbour channel.

Transnet currently expects that all these processes, including the relocation of the SBM, should be completed before the end of 2016 so that construction can proceed to enable the DDOP to receive first cargo in 2020.

Key Contracts and Suppliers
Protekon Consulting & Construction; CPS; IMPSA-Jikelele joint venture (JV); Kalmar African National Engineering, or ANE, JV; Hydroflow and Liebherr Cranes (Germany); Grinaker-LTA, Interbeton and Bafokeng Bateman Services (Bafokeng Civil Works and Bateman Materials Handling) JV; DSE and Dorbyl (subcontractors steelwork fabrication); La Spezia Container Terminal, Italy (three Liebherr cranes); Kalmar (straddle carriers); DSE (manufacture of structural components and the erection and installation of mechanical and electrical work); Protekon (planning and designing the infrastructure for the installation of the Liebherr cranes at the south terminal); Protekon Construction (two new berths for Island View terminal); Dura Piling (piling contract – Island View); Basil Read (main contractor – Pier 1, civil and paving works – DCT); Chryso South Africa (concrete products – hard standing area, Pier 1); Lafarge Readymix (design and supply of concrete – hard standing area, Pier 1); Natal Portland Cement, or NPC (cement – Pier 1); Kalmar Industries (30 straddle carriers); TBA (review, analysis and simulation of DCT’s container-handling operations); Sarens Group (crawler crane); the Japan Bank for International Cooperation (loan finance); Shanghai Zhenhua Port Machinery Company (rail-mounted gantry cranes); Shanghai Zhenhua Heavy Industries Co, or  ZPMC (design, manufacture, delivery and commissioning of cranes); Dredging International and Group Five (port-widening project); C3 Shared Services (codesign of security solution at Pier 1); Mott MacDonald, in JV with Hatch and Goba (widening of Durban harbour entrance and construction of Pier 1 container terminal); Blue IQ (financial coordinator for proposed container terminal at the old DIA site); and Liebherr (design, fabrication, delivery, erection, testing and commissioning of the cranes).

On Budget and on Time?
The project is on schedule and within budget.

Contact Details for Project Information
ANE Durban head office, tel +27 31 579 3301, fax +27 31 579 3323 or email aned@mweb.co.za.
Basil Read, tel +27 11 418 6375 or fax +27 11 418 6334.
Bateman, tel +27 11 899 9111 or email pgm@batemanbv.com.
Chryso South Africa, tel +27 11 395 9700 or fax +27 11 397 6644.
Dorbyl, tel +27 41 408 6009, fax +27 41 408 6035 or email dorbyl@guestroauto.com.
Dredging International, tel +32 3 250 52 11, fax +32 3 250 56 50 or email dredging@dredging.com.
DSE, tel +27 11 871 4111 or fax +27 11 871 4141.
Grinaker-LTA, tel +27 11 578 6000, fax +27 11 578 6161 or email enquiry@grinaker-lta.co.za.
Group Five, tel +27 11 806 0111, fax +27 11 803 5520 or email info@g5.co.za.
Kalmar Industries, tel +27 31 327 1800 or fax +27 31 327 1811.
Lafarge Readymix, tel +27 31 275 7400.
NPC, tel +27 31 450 4411 or fax +27 31 451 9010.
Sarens Group, Hendrik Sarens, tel +32 52 319 397 or email hendrik.sarens@sarens.com.
Transnet Port terminals, tel + 27 31 308 8000 OR FAX +27 31 308 8084.
ZPMC, tel + 86 21 58396666, fax +86 21 58399555 or email mail@zpmc.com.