Botswana to go ahead with coal line into South Africa

An interesting picture of logistical linkages with coal at its core is beginning to emerge after confirmation was received that Botswana will be taking a bulk railway line through to its eastern border with South Africa. According to the executive director for Botswana’s Investment Trade Centre (BITC), Moshie Ratsebe, the line will go from his country’s Mmamabula coal mines to Martin’s Drift north west of Lephalale (Ellisras). Speaking at a Botswana trade delegation business meeting hosted by theJohannesburg Chamber of Commerce and Industry (JCCI) last week, Ratsebe said the line would be 52 kilometres long, cost around $200 million, and would provide work for around 3000 people during the construction phase. He said Botswana Railways (BR) was busy “structuring the project and will very soon start looking to expressions of interests from possible investment partners”, most likely Transnet Freight Rail (TFR) which will be required to take the existing line ending in Lephalale through to Martin’s Drift.

Once the cross-border coal line is in place, it will not only provide significant spin-off opportunities for an arid area economically dependent on agriculture and game farming, but will provide landlocked Botswana with the logistical means to ship its coal to terminals to the east and south. On the South Africa side the proximity of vast quantities of fine-grain coal, at 212 billion tonnes said to be Africa’s most concentrated deposit of the resource, serves to underscore why the World Bank continues to support Eskom in its efforts to bring Medupi Power Station online. Hobbled by poor construction and massive cost overruns, Medupi has played a significant role in pushing Eskom’s debt to R440 billion, adding to the fear that the power utility’s inability to cover the interest on its debt and secure capacity could ultimately cause South Africa’s grid to collapse. Yet recently the World Bank pledged to loan Eskom R230 billion, much of it meant for Medupi. Speaking to FTW at the JCCI presentation, Ratsebe said BR’s CEO, Leonard Makwinja, had told Botswana’s parliament recently that the MmamabulaLephalale link “is the one big project we’re definitely going for at the moment”. As for earlier indications that Namibia’s state-owned rail freight enterprise, TransNamib, was eager to provide a logistics solution for Botswana’s coal, Ratsebe said “that project is frozen”. He reiterated that it would require BR to build a railway line of about 1500 kilometres from its Mmamabula coal fields through the country’s Kalahari interior to the Namibian border. Ratsebe said as far heknew BR was looking at re-conceptualising the project from a sustainability point of view. “We’re looking at what else could be run on such a line except coal.” He said it simply made more sense to move Botswana’s coal out via the planned line linking up with TFR’s existing infrastructure in South Africa. In addition to the Mmamabula-Laphalale line, BR is also thinking of extending its line which currently ends in Mosetse north-west of Francistown. It will require 355 kilometres of brand new track that will create a link with the Kazungula Bridge between Botswana and Zambia which is nearing completion. Ratsebe said Botswana was also looking at expanding capacity on a border crossing further north of Martin’s Drift in a bid to possibly create a corridor south east for the shipment of soda ash mined north west of Francistown. And although a lot of the details are scant, a picture of logistical collaboration concentrated around shared mining and energy interests between Botswana and South Africa has become very clear.