Ports & Ships Maritime News

Aug 26, 2009
Author: Terry Hutson

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  • First View – DURBAN BAY & HARBOUR

  • Transnet stays committed to its R80 Billion investment programme

  • Hamburg Süd names the RIO BLANCO

  • Transnet refutes locomotive order report

  • UN agency sounds alarm on dire Kenyan food situation

  • African population reaches 1 billion

  • News clips – Keeping it brief

  • Pic of the day – ORIBI


    First View – DURBAN BAY & HARBOUR

    Durban Bay and harbour from the air – quite a remarkable image considering that this was taken through the window of a SAA airliner. The image was taken on Friday 21 August 2009. Picture by Ian Shiffman

    Transnet stays committed to its R80 Billion investment programme

    Transnet Limited says it remains committed to its R80 Billion capital investment programme over the next five years despite the ongoing economic recession which has forced peers to suspend ambitious expansion plans.

    The state-owned freight transport and logistics company, which spent a record R19.4 Billion in the year ended in 31 March 2009, also expressed confidence that it will successfully spend and finance the planned R21 Billion in the current financial year.

    The company, which released its Annual Report 2009 this week, provided more details about the R19.4Bn it spent in the year ended in 31 March 2009. This amount, excluding the capitalisation of borrowing costs of R764 million, is 23% higher than the previous year. It brings to R53.5 Billion the total amount invested by Transnet in the last four years which is cumulatively more than the total capital expenditure of the core business divisions in the previous 15 years.

    Over the next three years, Transnet’s capital investments will amount to R57.7Bn, of which R35.4Bn is anticipated to be financed through borrowings from the debt capital markets – mainly from the domestic markets whilst the rest will be funded by cash generated from operations.

    In line with the Company’s growth strategy, there was a discernable shift in spending patterns towards creating capacity ahead of demand. The bulk of the year’s spend – 56% or R11Bn – was on expanding operations, while the balance (44% or R8.5Bn) was spent on replacement of existing infrastructure.

    Rail was by far the biggest beneficiary with some R9.2Bn or 47% of the total followed by the ports which invested R7.3Bn and pipelines R2.8Bn. The latter mainly went to the purchase of pipes, pumps and valves for the New Multi-Product Pipeline (NMPP) between Durban and Gauteng to replace the existing pipeline.

    Highlights of the five-year investment programme, in which Transnet’s largest division, Freight Rail, has the biggest share include:

  • Expansion of the Iron Ore Export Channel and the Coal Export Line

  • Acquisition of 304 locomotives for the coal, iron ore and general freight lines

  • Upgrading of the rolling stock and infrastructure for the general freight business

  • Widening and deepening of the Durban Harbour Entrance Channel

  • New Container Terminal at Durban Pier 1, reengineering of Durban Container Terminal and the Cape Town Container Terminal

  • Construction of the Ngqura Container Terminal

  • NMPP construction between Durban and Gauteng – Transnet’s single biggest project. The NMPP is intended to address long-term capacity requirements

    The capex programme, which is part of the government’s economic stimulus measures, is one of Transnet’s success stories.

    Commenting on the performance, outgoing Chairman of the Board, Mr Fred Phaswana says: “The records we have set since we launched our investment programme are a source of great pride, not only for Transnet; but for South Africa as a whole. Few companies have the capacity to manage a programme as large as we have. This is further testimony to the soundness of our decision to establish a specialist division to roll out this ambitious programme.”

    At the launch of the capital investment programme, Transnet also launched Transnet Capital Projects. Transnet then tied up with a joint venture of global engineering and project management specialists Hatch Mott MacDonald (and its local partners Goba) to effectively and efficiently roll out the demanding programme.

    Acting Group Chief Executive, Mr Chris Wells, says the Company has reviewed the entire programme and taken the necessary steps to respond to the deteriorating economic environment. On balance, the major and strategically significant projects, most of which are underway, are proceeding as planned.

    “This confirms our commitment to invest in our infrastructure to create, in a cost effective manner, appropriate capacity for our clients ahead of demand. Given the current drop in demand as a result of global economic conditions, we will implement a delayed phasing-in of certain investments. However, we will remain focused on priority projects where capacity is needed to prepare for the upturn when demand improves.”

    Highlights this year include the commissioning in October of Nqgura Container Terminal, the green-fields port being built near Port Elizabeth, and the delivery of some new locomotives. Mr Wells confirmed that Ngqura, which will initially have two berths and capacity to handle 800,000 TEUs each year, will be commissioned according to plans.

    Until recently, Transnet has funded the capital investment programme through its own cash resources which were made up of its own cash flows and the approximately R10 billion the Company raised through the disposal of non-core assets.

    Now that the disposal programme is complete, the Company is implementing its robust and comprehensive funding strategy. Mr Wells says the key focus of the strategy is to grant Transnet access to a diverse range of funders on cost-effective terms at the right time.

    To date, the Company has set up a R30Bn Domestic Medium-Term Note Programme (DMTN) through which it has issued a number of bonds in the local debt capital markets. Transnet has also signed a string of bilateral agreements with local and international financial institutions and, for the first time in its history this year, it concluded funding transactions with foreign export credit agencies.

    “We are genuinely heartened by the confidence that investors have shown in Transnet and our portfolio of investments by continuing to support our programme despite the turmoil in the global credit markets. We see this as an endorsement of our corporate strategy, business and operating model, risk mitigation plans, management and the attractiveness of our projects,” said Mr Wells.

    He says the Company has already raised more than 60% of the amount it needs to borrow in the current financial year – another sign of investor confidence in Transnet.

    “The exciting part of this strategy will be the launch of the Global Medium-Term Note Programme (GMTN) which will enable us to issue bonds in the US and European markets. We have done all the preparatory governance work. The launch is expected in due course,” he said.

    The programme has hitherto been delayed due to the state of the global financial markets which had made pricing too expensive among others.

    Hamburg Süd names the RIO BLANCO

    Left to right at the naming ceremony - Dr Heino Schmidt, Joachim A Konrad, Nina-Maria Oetker, Dr hc August Oetker, Dr Ottmar Gast, Dr Arnt Vespermann and Captain Arkadiusz Woszek.

    Hamburg, 24 August 2009 – On Monday the container ship RIO BLANCO was christened at Burchardkai in the Port of Hamburg. This is the fourth new vessel in a series totalling six container ships of identical design for Hamburg Süd. All of them have a slot capacity of 5,900 TEU, making them the largest vessels in the shipping group's fleet.

    The naming ceremony for the Rio Blanco was performed by Nina-Maria Oetker, wife of Dr hc August Oetker, General Partner of Dr August Oetker KG and Chairman of the Advisory Board of Hamburg Süd.

    After its christening the Rio Blanco will continue to operate in the shipping group's Europe-South America East Coast service, where it has been deployed since June 2009. By the end of the year the remaining two new vessels RIO BRAVO (which was delivered last week) and "RIO MADEIRA (which is still under construction) are also to be phased into this service. They will replace the ‘Monte’ ships (5,500 TEU) currently employed there, which will then operate in Hamburg Süd's Asia - South Africa/South America East Coast service.

    The Rio Blanco is named after a river in the region of Valparaíso in central Chile.

    Among the many guests were also 18 children from the SOS-Kinderdorf Harksheide near Hamburg. They had come to the ceremony at the personal invitation of Dr hc August Oetker, who wanted to offer a very special experience to the six to seventeen year-olds. Similar invitations had also been issued on other occasions as Dr Oetker had assumed a sponsorship for SOS-Kinderdorf e.V. in February 2007.

    The new ship has a capacity of 80,115 deadweight tonnes and a container capacity of 5,900 TEU – of which 1,365 are reefer plugs. The ship has an overall length of 286.45m and a breadth of 40m with a maximum draught of 13.5m. Her speed is given as 23 knots and her engine output is 45,760kW.

    Note – Each of the ‘Rio’ class of ships has called at Durban on their maiden positioning voyages, before being allocated to the company’s South America – Europe service.

    Transnet refutes locomotive order report

    Transnet says that an erroneous impression may have been created by an article “Transnet unit ‘ready to sign for 212 diesel engines’” in a report in Monday’s Business Report, which said that Transnet is about to either sign or re-issue a tender to procure 212 locomotives.

    “There are no such plans nor order, and the tender, which was cancelled after procedural irregularities were identified by an independent probe we commissioned over a year ago, remains cancelled,” said Transnet spokesman John Dludlu.

    He said that any statements suggesting otherwise are unauthorized and have no validity.

    “Locomotive acquisitions are now governed by a strict and rigorous governance process under the supervision of the acting chief financial officer. It is this structure that oversees the implementation of Transnet’s approved locomotive fleet strategy. No locomotive acquisitions have been approved apart from the acquisition of the 100 locomotives for which a tender has been issued and is currently being evaluated. To reiterate: the 212 tender was cancelled!”

    UN agency sounds alarm on dire Kenyan food situation

    Nairobi, 25 August 2009 – The United Nations food agency today issued a warning that Kenya faces a dire hunger crisis due to failed rains, appealing today for 230 million US dollars to feed nearly 4 million Kenyans – nearly one-tenth of the African nation’s population – over the next six months.

    “Red lights are flashing around the country,” said Burkard Oberle, Kenya director of the World Food Programme (WFP).

    “People are already going hungry, malnutrition is preying on more and more young children, cattle are dying – we face a huge challenge and are urging the international community to provide us with the resources we need to get the job done,” he added.
    WFP is currently distributing 2.6 million drought-affected Kenyans with food aid and hopes to increase that number by 1.2 million.

    Many parts of Kenya have experienced three or even four consecutive seasons of failed rains, and conditions are expected to deteriorate, with the Government projecting the main maize harvest to fall nearly one-third below the five-year average. In addition, pasture and water for livestock is quickly dwindling.

    The hardest-hit Kenyans have taken drastic measures, such as reducing the number of meals each day, eating cheaper and less nutritious food, migrating to urban centres and taking on massive debt.

    Acute malnutrition rates among children under the age of five are over 20% in some areas, well above the 15% emergency threshold.

    “Life has never been easy for the poor in Kenya, but right now conditions are more desperate than they have been for a decade,” Mr. Oberle said. “WFP is aiming to help almost 1 in every 10 Kenyans to cope wit this serious crisis but we can’t do it without money.”

    The agency also hopes the influx of funds will allow it to expand its school feeding programme by 100,000 to reach almost 1.2 million children. The Kenyan Government provides schools meals to some 500,000 more young people through its own scheme.

    Across the Horn of Africa, WFP is facing funding shortfalls, including over $160 million for Somalia and nearly $100 million for Ethiopia.

    Last month, the agency’s Executive Director, Josette Sheeran, warned that millions of hungry people around the world will not receive food aid from due to a “dangerous and unprecedented” $3 billion budget shortfall this year.

    WFP is hoping to reach 108 million people in 74 countries this year with food aid, but it expects to receive only $3.7 Billion of the $6.7 Billion needed for 2009.

    Note: A large proportion of food aid to Kenya and other parts of East Africa reaches the region by sea.

    African population reaches 1 billion

    Dar-es-Salaam (BuaNews-Xinhua) - Africa's population has reached 1 billion as the continent's population grows by about 24 million a year, says a report published by the Washington-based Population Reference Bureau.

    Published jointly with the US government aid agency USAID, the document says it is expected that the African population will double to nearly 2 billion by 2050.

    Although population growth has slowed in North African countries such as Egypt and Tunisia, on average women in sub-Saharan Africa have more children than women elsewhere.

    “While globally the average woman has 2.6 children, in sub-Saharan Africa she has 5.3 children (which is down from 6.7 children in around 1950), the world's highest,” the report said.

    Worldwide, 62 percent of married women of childbearing age use contraception, but in Africa the figure is 28 percent, according to the report, which also revealed that sub-Saharan Africa has the world's most youthful population, “and it projected to stay that way for decades.”

    In 2050, the African continent is expected to have 349 million youth, or 29 percent of the world's total, a sharp rise from the 9 percent of the world's youth in 1950, the report noted.

    While less than 60 percent of youth go to secondary schools worldwide, that figure is less than 30 percent in sub-Saharan Africa, according to the report.

    It also pointed out that HIV prevalence appears to be on the decline in Africa, although the rate of infection is still much higher than elsewhere. Swaziland has the highest rate of HIV infection in the world, with 26 percent of people aged between 15 and 49 being HIV positive.

    Although Africa has a seventh of the world's people, it has a quarter of the world's refugees, the report said, adding that global population numbers are on track to reach 7 billion in 2011, just 12 years after reaching 6 billion in 1999.

    Virtually all of the population growth is in developing countries, while the growth of the world's youth population is shifting into the poorest of those countries, according to the report.

    The population change will shape the prospects of regions and countries over the next half century, it further noted.

    As a companion to the bureau's 2009 world population Data Sheet, the report provided data and analysis on world population trends, youth, gender and the environment.

    News clips – Keeping it brief

    Tanzania suspends EU sugar exports: Tanzania has suspended sugar exports to the EU as a result of EU market reforms negatively affecting prices to African, Caribbean and Pacific countries. The volume involved is not large – 20,000 tonnes annually and Tanzania’s Minister for Industries, Trade and Marketing said the sugar production would be used to satisfy the growing domestic market instead. The suspension of exports may have some bearing on the decision by South Africa and Namibia to not sign the Economic Partnership (EPA) agreement between SADC and SACU members and the European Union. - source East African

    Container fleet shrinks 4 percent: After the mad rush to increase both the number and size of container ships by the world’s top container carriers, the reverse is now happening and a survey of the leading 24 container lines by French analyst Alphaliner indicates the container capacity available on the world’s fleet has declined over the past 12 months by 4% to 10.43 million TEU. Seven of the lines however, led by MSC and CGM have actually increased their container carrying capacity, mostly due to new ships for which the companies were already committed. MSC grew its capacity 11% and CMA CGM 6 percent. At the other end of the scale Maersk Line decreased its capacity by 5%, ZIM by 19%, CSCL by 18%, OOCL by 16%, MOL by 14% and Evergreen by 13%. Malaysia’s MISC led the field by slashing its fleet 39%, the report stated.

    Arctic Sea ‘pirates’ appear in court: The eight men captured by Russian naval authorities for highjacking the general cargo ship ARCTIC SEA in the Baltic this month, have appeared in a Moscow court. All eight have denied charges of piracy and hostage taking and two have launched an appeal against their arrest. All eight men were listed as unemployed residents of Latvia – source RIA Novosti

    International navies capture suspected pirates – then release them: An international naval force was forced to open fire before capturing seven suspected pirates in a skiff some 80 nautical miles east of Aden at the weekend but were obliged to let them go afterwards as there was insufficient evidence that they were pirates. Despite the lack of sufficient proof the men were found in possession of a ladder and large amounts of fuel, presumably for an extended stay at sea, as well as a number of weapons. Japanese, Dutch and Norwegian forces were involved in the chase and apprehension and after confiscating the weapons the suspects were allowed to sail away.

    Sao Tome passenger vessel runs out of fuel at sea: A passenger vessel, the LILIANA CARNEIRO which is registered in Sao Tome and is employed on a coastal passenger service in the Gulf of Guinea, ran out of fuel at sea before the vessel could reach its destination of Cotonou. The ship was carrying 400 passengers and suffered a fuel leak, according to the crew. Nigeria’s Regional Maritime Rescue Coordination Centre Search & Rescue directed rescue services to the ship some 30 n.miles off Lagos and provided water and a tow to the nearest port. – source Vanguard

    Pic of the day – ORIBI

    The oil products Unicorn Tankers ORIBI (4721-gt, built 1996) which was employed on the South African coastal service for a number of years, seen here sailing from Durban in January 2007. The ship, while still owned by Unicorn Tankers, is registered in Mexico and now operates for a Mexican company. Hence the distinctly Mexican (or should that be Mayan or Aztec) name currently carried by the ship – CITLALTEPETL II. With her overlarge squared off funnel the ship somehow manages to even look the part. Picture by Terry Hutson

    Don’t forget to send us your news and press releases for inclusion in the News Bulletins. Shipping related pictures submitted by readers are always welcome – please email to info@ports.co.za

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