Name and Location
Saldanha oil-services hub roll-out, Western Cape, South Africa.

Client
The roll-out is being being marketed jointly by the newly established Saldanha Bay Industrial Development Zone Licensing Company (SBIDZ) and Transnet National Ports Authority (TNPA).

Project Description
Tenders are being prepared for the Saldanha oil-services hub roll-out in the deep-water Port of Saldanha.

The developments are being packaged as build, own, operate and transfer concessions.
They also fall under the ocean-economy component of government’s wider Operation Phakisa (Operation Hurry Up) programme, and envisage transforming Saldanha Bay into a one-stop rig repair and oil-services hub.

Requests for proposals (RFPs) will be issued for a 380-m-long, 21-m-deep rig-repair berth, or Berth 205, to service deep-water rigs, as well as a shallower 500 m jetty and repair facility to service a range of other vessels associated with oil and gas exploration and development.

The new rig repair quay at Berth 205 will accommodate two rigs – submersible and semisubmersible drill ships at a time. As an interim measure, rigs are being accommodated at the 38 m Mossgas quay or are being serviced in the bay from a barge, with support vessels ferrying supplies and people to and from the repair platform.

The Mossgas quay wall will be lengthened from 38 m to 500 m, with a depth of 8.8 m, with 12 m pockets to accommodate floating docks.
In addition, TNPA will proceed with work on an offshore supply base (OSSB), which will be a service hub to offshore oil rigs, supplying rigs with food and materials, as well as waste-collection services. The berth length will be 280 m and the depth 8.5 m.

The SBIDZ, meanwhile, is preparing to ease the way for investors, which includes establishing the zone as a so-called free port – a customs control area that offers duty-free, value-added-tax-free conditions for operators.

Value
It is currently estimated that the marine infrastructure associated with Berth 205 and the jetty will require an investment of about R6.5-billion, while the land-side infrastructure, including cranes, workshops and warehouses, could involve capital expenditure of about R3-billion.

Duration
The expanded jetty, the rig repair and the OSSB are expected to be commissoned in December 2017.

The new dedicated infrastructure is expected to be in place by January 2018.

Latest Developments
Although the RFPs have not yet been issued, the intention is to identify preferred bidders by September this year to allow for sufficient construction time to meet the January 2018 deadline.

The TNPA, which plans to invest an estimated R3.9-billion across the South African port system in 2015/16, has not set aside a specific budgetary allocation for the infrastructure being put out on tender.

However, it will play a role in the design and will help facilitate environmental approvals.
The TNPA will also insist that the facilities are operated on an ‘open-access basis and that there is black economic empowerment and local community involvement.

SBIDZ business development executive Laura Peinke believes that the rationale for the projects remains strong, despite the recent sharp decline in the oil price. She remains optimistic that private fleet owners or independent operators will be interested in the tenders when issued.

This view is supported by South African Oil and Gas Alliance executive director Ebrahim Takolia, who argues that several international service providers are likely to be interested in the long-term economic rationale of locating a hub in close proximity to the expanding African market.

He says Saldanha Bay is well located for both the rigs operating off West and East Africa, and for passing trade, or the so-called tow-rig market. It is estimated that there are currently up to 100 rigs operating offshore around Africa, while as many as 120 rigs pass by South Africa for repair, primarily in Asia.

TNPA port manager Willem Roux says the intention is to transform Saldanha Bay from being a “port of last resort” for rig repair to a “port of first choice”.

However, TNPA CEO Tau Morwe is more circumspect, indicating that the drop in the oil price might dampen the appetite of investors and could, thus, have an impact on the timing of the projects.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
TNPA, tel +27 11 351 9001 or fax +27 11 351 9023.