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Grindrod, Vitol to invest R1.8bn in expanding Maputo’s Matola Terminal

Image of the Matola Terminal at the Port of Maputo

The Matola Terminal

3rd March 2022

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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Freight services and banking group Grindrod will spend its share of R1.8-billion to upgrade the Matola drybulk terminal at the Port of Maputo.

The JSE-listed Gindrod holds a 65% share in the Matola Terminal joint venture (JV), with energy and commodities group Vitol the other shareholder.

Grindrod Freight Services CEO Xolani Mbambo tells Engineering News Online that the project will run over the next three to five years.

The JV moves largely magnetite through the terminal, with coal making up between 10% and 20% of the cargo.

“Our in-house view on demand in the magnetite market is upbeat, with the long-term fundamentals quite positive, driven by infrastructure expansion in the US and China,” says Mbambo.

While coal is fighting a relevance battle in the face of a global move toward green energy, prices are at record highs on the back of global political tension.

Mbambo says the expansion project will see capacity at the terminal increase from the current 7.3-million tons a year, to 12-million-tons-plus a year.

The focus will be on upgrading the quayside to introduce a second ship loader, which will have to match the existing 5 000 t/h one.

“We’ll also expand our capacity so that we can receive more trains going forward, while also introducing a separate area where we can receive trucks at the terminal,” says Mbambo. “So we’ll have trains and trucks going into the terminal.”

Work on the expansion project has already started, specifically to understand the ability of the quay to accommodate a second ship loader.

“We expect to complete this by the fourth quarter,” says Mbambo. “Then we’ll start with the physical procurement of the ship loader.”

The completion of the project should enable the terminal to load a vessel in less than a day.

Building a possible second berth at the single-berth terminal is part of a longer-term phase-two expansion project.

Trading Profit up 32%
Grindrod on Thursday announced its financial results for the year ended December 31.

The company saw core revenue increase by 9%, to R5.2-billion, compared with the 2020 financial year. Core trading profit jumped by 32%, to R1.8-billion.

Grindrod CEO Andrew Waller said the results showed that the group was “starting to get some traction” following the unbundling of the shipping business and a decision that the group should focus on its freight services and banking divisions.

Work continues to streamline the group. The disposal of the car carrier business is complete, with the disposal of the fuel carrier businesses still ongoing.

Grindrod also sold its Grindrod Shipping shares, generating proceeds of R338.1-million.

Grindrod continued to work with the Marine Fuels management team and its co-shareholder to exit this investment, said Waller.

Grindrod’s private equity portfolio now consists of only two significant investments.

The disposal of the offshore real estate investment was concluded during November last year for £17.4-million, in addition to several smaller investments.

The strategy is to exit the remaining two investments “at the right valuations”.

 

Edited by Creamer Media Reporter

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