TFR rules out branch line concessioning

Transnet Freight Rail is pushing a collaboration rather than concessioning agenda when it comes to its policy on branch lines. Set to spend R200-R400m on reinstating branch lines, Siyabonga Gama, CEO of Transnet Freight Rail, told journalists in Cape Town last week that Transnet had in the past concessioned branch lines and that it had not worked. “We are not going to go down that road again and will always keep ownership of the lines,” he said, “but we are open to working with the private sector where the different parties bring what they can to the table. We have formulated a model that allows the private sector to come in and have access to the lines.” He said revival programmes for some 20 branch lines were currently being looked at – with at least three high on the agenda. This includes the Belmont-Douglas line, the Port Shepstone-Harding line and the Nkwalini-Melmoth line. “Some of the lines are operational at present, others are not. To get them going again is going to require investment and effort. That will come from the private sector and us,” he said. “What is important is that volumes on these lines are key to their sustainability. The investments required are high and it would not be viable to spend this much capital on lines that are not sustainable in the long term.” Whilst not committing to specifics on how it would work in practice he said it would be done on a “hub and spoke type system”. He said TFR was looking at branch lines in areas where the local community was driving demand. “If one looks at the Nkwalini line then there is major potential. A private operator is already running a tourism steam train on it and so we have been in discussion with various community role-players to look at ways of bringing cargo back onto the line from the Ceres area that it services.” He said the line linked with TFR’s national line in Worcester and so it made sense to push for more cargo on the line. “But we can’t do it alone – we need the fruit industry and the other cargo owners as well as the community at large to be involved. We want the private sector to invest with us and then preferably those people who are using the lines.” He said several phases had been identified for branch line upgrading with a 23 million ton ramp-up currently under way. “We are bringing partners on board from the private sector to work with us. It is slow going and will take time to achieve the goals we have set.” Over and above this, Gama said, TFR was committed to unlocking a further 30 million tons of capacity on lines servicing mostly the coal mines. “The coal can then be transported by rail to Eskom or if they don’t want it, it can be moved to the ports for export.” Gama said ensuring the right commodities were being moved on branch lines was just as important. “The viability of the lines relies heavily on the commodities being moved and would require sustained investments. The benefit of course would be to the entire region as there would be more economic development in the long run.”