Cape Town, South Africa — 10 May 2012 – It’s been revealed that the R300 billion allocated to Transnet for its massive national infrastructure programme is not enough to cover all the port and terminal expansions that are under consideration.
Fin24 reports that Transnet acting chief financial officer Anoj Singh told the portfolio committee on public enterprises in parliament that the cost of building a second dugout port in Durban and inland terminal hub expansions had to be taken into account.
“It is not enough. Definitely, it is not enough. We have identified the DIA [Durban International Airport] site. And it is anything northwards of R50 billion to establish the second dugout port. That is not in the current plan. Added to that, inland terminal hubs expansions are in the region of R10 billion,” he pointed out.
Singh pointed out that Transnet had created a structure to look at private sector participation. “We will require this type of private sector funding to ensure we keep pace with the demands of the economy,” he said
There was a need to contain costs, but the parastatal had to ensure projects were delivered on schedule. He said there would be cost over-runs, especially as this was a mega project.
“If you look at the roll-out of mega projects over the last 100 years, history tells you that you will have a 30 to 40% capital over-run on these projects.”
Transnet said it would be able handle 350Mtpa of freight, a 75% increase on its current rail capacity of about 200Mt, once the project was complete.
The spending programme was expected to create 588 000 jobs.
Source: Fin24. For more information, click here.