Transnet has no intention of slowing down when it comes to investment – even though challenges within the port of Durban cannot be addressed by “simply pouring concrete”, says newly appointed Durban port manager, Moshe Motlohi.
But a little cement in the far reaching mix of solutions required to keep things on track will certainly go a long way towards unlocking the city’s ‘blue economy’ and even preventing an Eskom like scenario that South Africa’s economy can little afford.
Mark Descoins, who declared that Transnet was standing its ground when it came to the Durban Dig Out Port (DDOP) despite the recommendations of “international experts” that the project be put on hold in favour of ramping up facilities and efficiencies within the existing port, put Transnet’s conundrum in a nutshell.
Having already spent R150-million on research and scenario planning, it seems that the first phase of the DDOP will need to be operational by 2025. This is based on the assumption that the far reaching expansions and upgrades to existing infrastructure go ahead. If they don’t, then Durban will run out of capacity even sooner. Even if they do materialise, suddenly waking up to the need for additional capacity in 2024 will have dire consequences as it will require at least 10 years to catch up, he warns.
It would be hard not to draw comparisons with the Eskom power stations that were not built until it was too late.
But the scenario is far more complex than that. The DDOP aside, simply actioning the upgrades and expansions required to bolster capacity within existing port boundaries may not be as easy as the international experts that were quoted believe.
Developments within the port inevitably ran aground during the apartheid sanctions era, leaving Transnet with a rush on the port once trade resumed. The port is not deep enough. Quays are crumbling and demand is escalating even during a period of lacklustre economic growth. Yet, businesses strategically located close to the crowded harbour are not going to give up the existing land that will need to be purchased to expand without hefty price tags. Local communities are understandably averse to relocation. That’s without often legitimate concerns of environmentalists.
However, the strategic importance of the port of Durban is evident in a few widely quoted statistics. For starters, Durban’s port ranks second in Africa and fifth in the southern hemisphere in terms of container through-put. It is the busiest port in Southern Africa in terms of vessel calls at around 4 000 per annum with 58 berths and 40 commercial vessels berthed at any given time.
During 2014, the Durban port handled more than 87 million tons of cargo. The focus is on cars, liquid bulk, the cruise industry and containers. 61% of all container imports and exports pass through the port of Durban, explaining why the container side of the business is being prioritised.
Unpack Transnet’s growth statistics for each of these categories of cargo and you notice a few interesting things. When it comes to containers, around 2,7 million ton equivalent units (TEU’s) were handled last year. Actual volume growth has been flat and probably below Transnet’s initial projections over the last two years. 2014 was the first year that the import export balance tipped with outward bound cargo marginally exceeding imports which Motlohi suggests may be linked the depreciation of the rand.
Annual automotive volumes which climbed by 17 percent last year to over 461 million units again tipped towards imports but the opposite is true in terms of bulk dry goods. Annual break bulk and liquid bulk volumes have grown but favour imports.
The extent to which things can go wrong when there are bottlenecks in such a busy port has been evident for a number of years. Citrus farmers have borne the brunt of delays whilst ships anchored outside the port for long periods waiting for berths and virtual chaos through truck jams on roads that cannot handle the traffic are well documented. All have cost implications for downstream industry.
A large proportion of this is due to inefficiencies which Motlohi maintains are being addressed. Transnet’s role is multi-pronged – landlord, regulator, marketer of port facilities in South Africa, master planner and change agent. Keeping all balls in the air is a formidable prospect. Not coping would have dire consequences for the economy, he admits.
He says that Transnet is putting in place operational centres to optimise the value chain, starting with marine services, extending to the terminal operating space and then moving all the way to the landside operations. “What is important is that we have now sat down with players in marine services and asked what is the best service offering we can give to customers. The information coming out will (determine) how much we invest and how we target our investment. We want less waiting times. But (success) depends on the quality of information coming in from users.”
It seems that R17 billion has been allocated for investment in the port of Durban within the next seven years. This is a sizeable portion of the total R47 billion committed to port infrastructure upgrades nationally as part of the parastatal’s market demand strategy. The crux of this is providing for accelerated demand proactively.
What Motlohi describes as short term projects include berth deepening on the north quay, Maydon Wharf’s quay wall reconstruction, reconstruction of berths at Island View and the building of the Point passenger terminal.
At present, work at Island View is well underway, he says. The transformation of berth 2 into a new deep water berth for larger tanker vessels will increase the current draft of -11.7 metres to 14.5 metres. The reconstruction of berth 5 will also create a new deep water berth for larger vessels and accommodate growth in liquid bulk volumes while the extended bunker barge berth at berth 10 will now cater for more than one barge at a time.
According to Motlohi, in the medium term, Transnet wants to build another four liquid bulk berths at Island View, acquire land at Ambrose Park and increase the commercial and logistics space and begin the Pier 1 expansion with the Salisbury Island infill.
Also, in the longer term, Transnet is looking to acquire additional land at Bayhead Park to increase the commercial and logistics space and resolve the notorious logjams.
But the true measure of just what can be achieved in the Durban port – as well as at the DDOP – will probably be best illustrated by whether or not additional plans for both Maydon Warf and the existing container facilities can become realities.
When it comes to the Maydon Wharf upgrades, Motlohi says that although the easiest option would have been to simply close off the area during construction, Transnet quickly realised that this would jeopardise food security and have a negative economic impact. Instead, the decided on a phase approach, decommissioning different areas. The two “big interventions” of the moment – berths 1 to 4 and 12 to 14 – are already under construction.
The chief challenge in Durban, he admits, is that vessels are getting longer and require deeper drafts. The ideal is for shipping companies to use larger vessels and make fewer calls to keep down costs. But, in Durban, it is impossible to accommodate or unload fully laden mega container ships. And they are getting bigger by the day.
Which brings Motlohi to the all-important proposed mega project at the Pier 2 container terminal. The plan is to deepen berths 203 to 205 plus the basin and approach channel from -12,8 metres to – 16,5m. At the same time, they want to lengthen the three berths from 914 metres to 1210 metres. This will allow the terminal to accommodate three 9 200 TEU vessels with 14,5 metre drafts simultaneously.
Then there’s the need to strengthen quay walls to accommodate the massive 80 tonne tandem lift ship-to-shore cranes needed to unload these fully laden mega ships. The original STS crane design provides for a 60 tons/wheel load and an outreach of 14 container boxes. Cranes with a 130 tons/wheel design and an outreach of 24 container boxes are needed. Without deeper berths and stronger quays, one of these could collapse with catastrophic consequences, he warns.
At this point, Transnet is looking to start construction early next year with completion set for December 2020. The Department of Environmental Affairs (DEA) authorised the project in January but there have been two notices of appeal from the South Durban Community Environmental Alliance and Earthlife Africa Durban. Appellants had until this week to submit documents and Transnet has 30 days to respond.
Although there is no stipulated time frame, it is anticipated that the DEA will take a further two months to make a final ruling.
Then there is an even bigger potential project on Motlohi’s list – the Salisbury Island Container Terminal. This entails the infill of pier 1 and reclaiming 21 hectares to create a Container Terminal of 1.8 million TEU per annum as well as 1,288 metres of productive quay length for three berths
He says that the Salisbury Island Infill is currently at the feasibility stage. Design work is expected to be concluded in July 2015. Although certain EIA studies have already commenced, this has not yet been lodged.
On completion in 2021, this is expected to increase capacity increase from 0.7 million to 2.5 million TEUs.
Again, it’s not as simple as just building bigger and better facilities. Motlohi points out that it follows that, if throughput increases, back of port infrastructure has to keep pace. Bayhead Road will have to be widened from two to three lanes on either side while Langeberg Road must be increased from one to two lanes. In addition, new gates to the port will have to be built on both thoroughfares.
It also doesn’t stop at bigger roads. Currently, the port’s efficiency is being curtailed by “peaks and valleys” in the arrival and departure of trucks which port authorities intend smoothing out through devising a “holistic package” that will stack trucks on a 24/7 basis and then determine when they can enter and depart the port. Sophisticated systems will also enable port customers to track and trace cargoes.
This is all ambitious to say the least. But it is also ultra important if Durban is to remain the gateway to Southern Africa. Now all that has to be navigated is the potential appeals and delays. Motlohi says Transnet is hoping that all stakeholders will fully appreciate the strategic importance of planning ahead of time.