Transnet Capital Projects
Expansion amidst a financial economic downturn
March 2009
A Global Impact




       $700-bn US financial bail-out


       2009: Overall GDP growth of 0.8%


       Recession? Dep...
A Challenging Crisis




  • Businesses are still reporting profits
  • The quest for survival
  • Job losses are a last r...
A South African Perspective




        Economic growth at lowest levels since 2000


         Q3 weakest growth rate this...
South Africa is Globally Connected




                           • Global deflation, not inflation

                     ...
Opportunity Amidst the Crisis



 Preparing for 2010 World Cup Soccer


 Confirmation of R80-bn investment


 2009/2010: R...
Transnet Capital Projects Embraces
Growth


Transnet’s 4 Point Turnaround Strategy :

                                    ...
5 Priority Corridors: Transnet’s Customer
Focused Value Chains




                                                     Rb...
Ore Line: Sishen-Saldanha Corridor


                            865 km ore line

                            2007/2008 ra...
Cape Corridor


     Cape Town container terminal:
     •   Increase capacity to 1.4 million TEUs
     • Deepening of Ben ...
Natal Corridor


                 Durban Entrance Harbour Widening:
                 • Channel widened to 225m
           ...
Richards Bay Corridor


                        Coal Expansion Project:
                        • Increase export capacity...
New Multi Product Pipeline NMPP


    Pipeline Project:
    • Construct and operate the New Multi-Products Pipeline from D...
Rehabilitation, Maintenance and Emergency
(RME)




  • Major rehabilitation projects that have been undertaken include Ov...
Determined in Difficult Times



World Class Project Support Services

Ambitious safety targets, with reduced
LTI ratios

...
Transnet Capital Projects Delivers
Excellence                       C    om
                       ces               mu
  ...
One Company, One Vision



                              Capital Projects has a central role to
                          ...
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Expansion amidst a financial economic downturn

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Presented by: Noel Cronje at the 2009 Railways and Harbours Conference in Cape Town.

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Expansion amidst a financial economic downturn

  1. 1. Transnet Capital Projects Expansion amidst a financial economic downturn March 2009
  2. 2. A Global Impact $700-bn US financial bail-out 2009: Overall GDP growth of 0.8% Recession? Depression? Deceleration of emerging markets 2
  3. 3. A Challenging Crisis • Businesses are still reporting profits • The quest for survival • Job losses are a last resort Innovation Opportunity Leadership 3
  4. 4. A South African Perspective Economic growth at lowest levels since 2000 Q3 weakest growth rate this decade China growth rate to drop to 7% Household spending showed the first contraction since the first quarter of 1994 Collapse of commodity and equity prices 4
  5. 5. South Africa is Globally Connected • Global deflation, not inflation • Low global interest rates • The recession of the entire EU (European Union) • The US’ expected -4% growth rate in 2009 • US household wealth has declined by US$12 trillion, which is 9% of the country’s GDP. 5 Prof Gill Marcus 2009
  6. 6. Opportunity Amidst the Crisis Preparing for 2010 World Cup Soccer Confirmation of R80-bn investment 2009/2010: R10-bn investment A healthy economy requires a reliable and efficient transport system, which is core to our mandate of reducing the cost of doing business in the country Transnet confirms its promise to deliver on our commitment to YOU 6
  7. 7. Transnet Capital Projects Embraces Growth Transnet’s 4 Point Turnaround Strategy : Transnet’s • Improved operational performance through re-engineering • Improved stature through risk and governance Growth • Improved financial achievement through balance sheet Strategy restructuring • Capable employees through a focus on people and human capital Transnet Capital Projects is mandated to PLAN, DELIVER, MAINTAIN and SUPPORT infrastructure through its world-class EPCM (engineering, procurement and construction management) execution methodology within key corridors. 7
  8. 8. 5 Priority Corridors: Transnet’s Customer Focused Value Chains Rbay Cor Natcor NMPP Ore Line Cape Cor 8
  9. 9. Ore Line: Sishen-Saldanha Corridor 865 km ore line 2007/2008 railed 31.9 million tons of iron ore Planned expansion to 47 mtpa Project deliverables: • Acquisition of rolling stock • Alterations to crossing loops and construction of new loops • Upgrades to rolling stock workshops • Power supply upgrade • Refurbishment of the ship loader and conveyors 9
  10. 10. Cape Corridor Cape Town container terminal: • Increase capacity to 1.4 million TEUs • Deepening of Ben Schoman Berth to 15.5m • Quay refubishments of berths 601 – 604 • Dredging of 1.23 million cubic meters of sand • 8 new ship-to-shore cranes to service larger vessels Ngqura Container Terminal: • Breakwater construction • Dredging of basin and channels • Sand bypass system • Five berths and back-up areas • Initial landside infrastructure • Pilot boat and tugs 10
  11. 11. Natal Corridor Durban Entrance Harbour Widening: • Channel widened to 225m • Deepened to -19m in the approach channel and -16.5m in the inner port channels and basins Pier 1: • Project completed with a handling capacity of 720 000 TEUs per annum Durban Container Terminal Re-engineering: • Redesign stacking area to maximise capacity for the Durban Container Terminal and the Port of Durban • Capacity to increase by an additional 600 000 TEUs 11
  12. 12. Richards Bay Corridor Coal Expansion Project: • Increase export capacity to 72mtpa by 2010/2011 • Planning for further expansion of export capacity to 81mtpa Refurbishment Project: • Feasibility studies to increase capacity by extending the 700 series berths by an additional two • Increasing container terminal capacity by converting the 600 series berths to approximately 2.6 million TEUs • Developing the 500 series to increase capacity to 3.7 million TEUs 12
  13. 13. New Multi Product Pipeline NMPP Pipeline Project: • Construct and operate the New Multi-Products Pipeline from Durban to Gauteng • Capacity initially be 1100 cubic meters per hour and will eventually reach 3 000 cubic meters per hour on the main line • Construction of a new 24 inch diameter trunk-line • Total of 550 km pipeline to address the increased demand for fuel in Gauteng and surrounds 13
  14. 14. Rehabilitation, Maintenance and Emergency (RME) • Major rehabilitation projects that have been undertaken include Overhead Traction Electrification (OHTE) Infrastructure Rehabilitation and Signals Powered Upgrade. • Responsible for all the routine maintenance work on the Perway, including maintenance of sleepers, drainage areas and rail tracks. • Emergency Maintenance work for Freight Rail 14
  15. 15. Determined in Difficult Times World Class Project Support Services Ambitious safety targets, with reduced LTI ratios Customer-centric approach towards procurement, world-class standards Sound business practices and good corporate governance Sustainable project development and effective environmental management Transnet confirms its promise to deliver on our commitment to you. National infrastructure planning and development 15
  16. 16. Transnet Capital Projects Delivers Excellence C om ces mu r ou nic es atio Environment nR ns ma and Sustainable Hu Development National Project Design Infrastructure and Execution Planning World Class Project Management Excellence •Procurement Rehabilitation, •Finance & ICT Maintenance •Project Support and Emergency Services Safety and Risk 16
  17. 17. One Company, One Vision Capital Projects has a central role to play in the enablement of growth for Transnet Adopted a holistic and customer-centric EPCM approach Construction management services through: • Planning • Demand, pre-feasibility and environmental studies • Procurement • Project management and execution • Financial processing and cash management 17 Sources: (McKinsey Quarterly Report: January 2009; ABSA: Capital Review January 2009; GIBS News January 2009)

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