Trans Kalahari saves TransNamib
An estimated 90 million tonnes of coal will flow through Namibia annually once the railway link to Botswana’s rich coalfields has been completed. A memorandum of understanding to start the process was signed by Namibian and Botswana officials in Walvis Bay two weeks ago.
“A developer-arranged investment model has to be set up that will guide amongst others the financing, construction, and operation of the railway line. A ministerial committee comprising representatives of both governments is yet to be established, and a joint venture will be set up by both governments as well as a Public Private Partnership that will drive the process necessary to see the successful construction of the envisaged Trans Kalahari Railway line,” according to Ailly Hangula-Paulino, Chief Corporate Communications Officer at TransNamib Holdings Limited.
Hangula-Paulino sketched a picture of the framework that will accompany the agreement and what each party would be required to do with regard to the construction of the railway line from a cost, construction, and development point of view.
Said Hangula-Paulino, “The parties shall develop the project through the government agencies responsible for rail. The government agencies shall form a jointly-owned company which shall enter into a Public Partnership Concession Agreement with a developer, which shall determine the duration of the concession period, and the concession agreement shall determine the relationship, roles and conditions of the development of the project by the developer.”
This comes after the governments of Namibia and Botswana signed a Memorandum of Understanding (MoU) earlier in March 2014. The MoU covers aspects related to the envisaged rail network that will run along the Trans Kalahari Corridor (TKC) connecting the harbour town of Walvis Bay with the existing railway line in eastern Botswana.
She said “In Namibia, the railway line shall follow the Trans-Kalahari corridor past Gobabis through to Omitara where it deviates to the west and realigns to the Trans-Kalahari Corridor at Okahandja, onwards to Walvis Bay. In Botswana, the rail shall commence at the Mmamabula coal fields connecting to and flowing to the existing railway line up to Rasesa where it deviates to the West passing north of Molepolole and east of Letlhakeng, joining the Molepolole-Kang road around Maboane, thereafter aligning to the Molepolole-Kang road until Maramosu where it will run along the TKC through to the Mamuno border post.”
Details on the financing of the project are yet to be established as well as when construction will commence pending the setting up of the Joint Venture company and the subsequent ministerial task team. Each country will in its territory bear the costs in accordance with policies and laws of each party according to Hangula-Paulino who pointed out that the budget would be split in two equal shares. The project is expected to cost upwards of N$100 billion and follows years of protracted negotiations at setting up a rail link between the two countries. The 1500 kilometre railway line should be completed in 5 years and will initially depend on the ferrying of approximately 90 million tonnes of coal each year to India and China respectively. Demand for coal is expected to peak around 2020 and Botswana will be hoping to take up the lion’s share of total coal exports, exporting 10% of the world’s total coal production, competing against Colombia, Australia, Russia and South Africa.