Saturday, October 31, 2020

Botswana Railways to transport Minergy coal to SA

Botswana Railways and Minergy coal mining company this Friday launched coal export deal in which the rail company’s 50 wagon train carrying over 250 000tonnes of coal produced in Medie will be transported to South Africa. 

The connection rail from Tshele hill to the main rail line was funded by Absa bank Botswana. Botswana will emerge as a major transportation hub or gateway on the regional corridor and help support overall trade in the medium to long term.

The Botswana Stock Exchange listed Minergy which has been pioneering the coal industry in Botswana has so far evacuated 200 000tonnes of coal out of Botswana becoming the first company to move it across the border to South Africa and Namibia by road. More than 90 percent of Minergy’s target market, in volume terms, is in South Africa. 

Speaking at the launch of the partnership, Minergy Chief Executive Officer, Morné du Plessis highlighted that, the efficiency of rail will give them an opportunity to evacuate more of their coal. The Coal will reach South Africa same day and within five hours. 

He added, “we want to develop the coal industry. Botswana has 200billion tonnes of coal. We should not sit on the opportunity. We are negotiating with our customers to transport one train a week. The rail project of Mmamabula-Lephalale needs to be developed so that Botswana is able to export coal to other countries. We hope the project will materialize quickly.” 

Launching the partnership, Minister of Transport and Communications, Thulaganyo Segokgo emphasized that the partnership must be nurtured into a sustainable and long lasting one. Railways are still struggling to transform themselves particularly in the African continent. Coal mining will become one of the largest rail users in Botswana and as such, Segokgo said rail transport is critical to supporting economic development; “unless it is fully developed Botswana may not realise its full potential in exploiting its abundant natural resources and wealth. There is need for robust rail infrastructure to support the evacuation of coal to international markets, especially Asia where there is high demand. Given the geographic location of Botswana, adequate infrastructure is critical for the growth and competitiveness of Botswana. Inadequate infrastructure may be a threat to Botswana’s growth potential but at the same time its an opportunity for private sector investors to finance physical infrastructure assets as railways.”  

There are significant opportunities for railway development in Botswana as a result of potential production of large volumes of goods such as bulk minerals commodities that are natural markets for railways. It is for this reason that, Segokgo’s Ministry has set aside funding for bankable feasibility study for the much anticipated Mosetse-Kazungula and Mmamabule-Lephalale railway lines. 

According Minister Segokgo, the process of evaluating the bids is ongoing and he went onto add that there is urgent need to fast-track the Mmamabule-Lephalale link to transport the coal reserves as the current rail capacity cannot support the envisaged export volumes. Government is considering Public Private Partnerships to develop these rail links. There are four proposed rail links, Mmamabule- Lephalale, Mosetse-Kazungula, Trans Kalahari and Port Techobanine heavy haul rail project.

The development of these lines is the main focus for Botswana Railways and will have a significant impact on the Southern African Development Community (SADC) region.

RELATED STORIES

Read this week's paper

Is the Kebonang judgment opening a pandora’s box?

The High Court’s decision that reviewed and set aside the Director of Public Prosecutions’ decision to institute criminal proceedings against the two...