TRANSNET of South Africa has proposed to establish a multi-purpose fuel pipeline from Ndola to Lusaka which will help Zambia reduce its fuel pump price, among other benefits.
Transnet has also offered, on terms that could be agreed on later, to pass on to Zambia Railways Limited (ZRL) its railway fuel tankers that it previously used to transport fuel stocks between Durban and Johannesburg. This follows Transnet’s completion of a 20 billion rand pipeline between Johannesburg and Durban.
This is contained in a statement issued to media by Press Secretary at Zambia’s mission to South Africa Nicky Shabolyo.
The company has had to take the pipeline option as this has in recent times been identified as the most cost effective and efficient way of delivering fuel across long distances.
The company has further called for the resolution of challenges it has been facing with ZRL in implementing its so-called North-South Corridor project which is part of its efforts to realising its grand venture of integrating South Africa with the rest of the continent through the creation of competitive corridor supply chains.
The projects came to light when Zambia’s High Commissioner-Designate to South Africa, His Excellency Mr. Emmanuel Mwamba met Indeni Chairperson Mr. Johnstone Chikwanda, Transnet Executive Manager for International Business Ms. Nyameka Madikizela and Commercial Manager in charge of private sector participation Ms. Maggie Tsholetsane at his office in Pretoria yesterday.
Transnet is a South African state-owned company with experience in rail transportation, port management as well as pipeline technology and transportation.
Ms. Madikizela said Zambia had strategic resources and its location was attractive to Transnet in as far as the logistics supply chain and rail transportation of imports and exports through South African ports was concerned. The North-South Corridor, to which Zambia is a major party, can accommodate bigger vessels at a shorter turn-around time when compared to other export/import corridors.
“Transnet has been working closely with Zambia Railways Limited as a strategic partner, as Zambia is one of the few countries where there is return cargo originating from its source,” Ms. Madikizela said.
She said Transnet has established three Joint Operating Centres (JOC’s) on three of their international corridors which are Maputo, Noth-South and East-West Corridors and that the plan was to integrate South Africa with the rest of Africa through corridor chains that will integrate its ports and railways efficiently.
Ms. Madikizela said ZRL was a co-signatory to the North-South Corridor operations memorandum of agreement (MOA) which included the development of the Maputo Corridor long-term railway and port investment plan so as to ensure that the planned volume growth and logistics are synchronised with the required infrastructure investment.
She regretted that the momentum on the North-South Corridor has slowed down and urged all parties to the project to re-dedicate themselves.
The North-South Corridor investment project was being led by the NEPAD Business Foundation; and sponsored by TFR and Grindrod (a shareholder in BBR). The project takes into account the current and future volumes, the infrastructure assessments, the funding requirements, and others. The NEPAD Business Foundation is in the process of appointing consultants to execute the outputs that the railway operators were unable to execute.
On the proposed pipeline from Ndola to Lusaka, Ms. Madikizela said this would be a public policy driven project which could be constructed along the ZRL corridor under a private-public-partnership (PPP) structure. The project would involve a local partner, ZRL and Transnet and did not require the Government of Zambia to raise or source any funds as financing would be raised by the PPP members.
She said the proposed multi-purpose fuel pipeline would be from Indeni Oil Refinery in Ndola to another terminal to be established in Lusaka.
Ms. Madikizela said the pipeline would be underground and made of appropriate material and envisaged to transport about 500 million litres of stock per year.
She said Government support would be needed as the bulk of the fuel to be transported would be inter-depot and belong to Government. Ms. Madikizela pointed out that revenue would be raised by charging fuel owners, who are the Government and oil marketing companies, a tariff for carrying the commodity.
“This is a huge project which, just as in the case of a similar project we have just finished between Durban and Johannesburg, will directly and indirectly create significant employment for Zambians both during and after construction.”
“This way of transporting fuel has several advantages which include reduced fuel cost for owners, it is safer compared to road tankers, there is reduced pressure on roads and above all it guarantees fuel security or availability in the country as the pipeline is complete with a depot which could contribute to increased fuel holding capacity in the southern region of Zambia,” she said.
His Excellency Mr. Mwamba said the Mission has written to the Ministry of Transport and Communications and proposed meetings with stakeholders in Zambia to be held between 15 and 19th November, 2015.
Mr. Mwamba said the proposed projects would help reduce the fuel pump price for the benefit of individuals and the business community in Zambia which he said would lead to economic growth.