Saldanha oil and gas hub gets the green light

After Transnet’s bureaucratic red tape recently strangled a multi-million rand private sector project for an oil and gas hub at Saldanha Bay, government has now singled out the port as an ideal location for such a cluster. The special study underlying the plan for the government’s proposed special economic zones (SEZs) – results of which were released last week – found that Saldanha Bay was an ideal location for the development of an oil and gas cluster. The earlier scheme proposed by Dutch-based Universal Africa Lines (UAL) was to develop an oil and gas shipping supply hub at Saldanha Bay to serve the line’s interests up the African west and east coasts. But, after two and a half years of “heavy negotiations” with Transnet National Ports Authority (TNPA), UAL Alliance chairman, Roger Jungblut, eventually decided to pull the plug on the long drawn-out chaffer in February – and a handsome, money-earning scheme for Saldanha was lost. But now minister of trade and industry Dr Rob Davies has said that 10 potential SEZs have been agreed upon with provinces, as he presented his department’s Special Economic Zones Bill to the portfolio committee on trade and industry in Parliament last week. “The purposes of the SEZs include facilitating creation of an industrial complex with strategic economic advantage for targeted investment and industries in manufacturing sector and tradeable services,” he said. “This will also focus on developing infrastructure to support development of targeted industrial activities and attracting foreign and domestic direct investment.” This is a rather noble desire. But, at the same time, it inadvertently condemns Transnet for its reticence in accepting a ready-made plan for a scheme that fulfilled Davies’ desires for “tradeable services” that “attracted foreign investment” – and millions of it. Also, in March this year, FTW published a story that pointed out that the Saldanha industrial development zone (IDZ) – which will be incorporated in the SEZ plans – had been singled out as a top priority for the Western Cape government, according to its Premier Helen Zille. The IDZ in Saldanha will be designated by the National Department of Trade and Industry in the next few months, she added, and a key project in the IDZ is the development of an oil and gas servicing hub. Given that these new conditions arrived on the scene after the UAL scheme was withdrawn, FTW telephonically quizzed Jungblut while he was on a flight from Amsterdam to London to see if he might change his mind about cancelling his project. But, he told FTW, he was as yet unaware of the details of the dti’s proposed SEZs. And, without these, he said: “I can’t give much comment at the moment.” However, he added: “It does look as though they are developing something promising. But whether we can use it, we’ll only find out once we know more about just what these SEZs have to offer.” So, there might be a reprieve for the UAL project, a scheme that fulfils all the conditions laid down by Davies and Zille. But it all depends on Transnet overcoming its predilection for red tape. If it can’t, a healthy proposal for an oil and gas shipping supply hub that could earn millions, if not billions, in future business for Saldanha, could once again go down the drain.