The Port of Richards Bay, in KwaZulu Natal, is South Africa’s largest cargo port and a significant contributor to the country’s economy. Jimmy Hills talks to Gay Sutton about a vision for the port to become a global leader.
The Port of Richards Bay is run by Transnet National Ports Authority (TNPA), part of the state-owned transportation authority Transnet, and was opened in April 1976 to handle the export of coal from Mpumalanga Province. Beginning with a modest two berths to handle coal, it has diversified and grown at an average rate of one additional berth every two years. Today it is South Africa’s largest cargo handling port, handling around 55 per cent of the country’s seaborne cargo.
Located some 160 kilometres north of Durban on the estuary of the Mhlathuze River, the port is one of just two deepwater ports in South Africa, and is designed for Cape-sized vessels up to 150,000 tons and 17.5 metres in draft. Serving the hinterland provinces of KwaZulu Natal, Mpumalanga and Gauteng, as well as the aluminium factories and paper mills that have grown up around it, the port contributes significantly to the national economy. “Our analysis indicates that a berth returns around one billion rand of revenue for the country,” explains planning and development manager, Jimmy Hills. “That is, in revenue to downstream industries and businesses.”
Coal continues to be a major element of port operations, and the recent addition of a new R443 million coal berth has taken capacity from 72 million tons to 84 million tons a year, firmly establishing Richards Bay as the world’s largest coal exporting port. “The new berth was one of our two yearly expansions,” Hills says, “but ultimately we intend to upgrade capacity to 91 million tons a year through terminal efficiency and productivity improvements. We will then cap our coal capacity at that. However, if the coal reserves in Mpumalanga prove to be sufficient to warrant further expansion, then we’ll increase the number of coal berths.”
Last year around 65 million tons of coal was exported through Richards Bay. The coal arrives on massive 200-wagon trains on the purpose-built and aptly named Coal Line, which not only links the port to the coal mines of Mpumalanga Province but also provides access to the extensive national rail network.
RichardsBayhas diversified considerably, and the growth in its market sectors looks set to continue. Today the port also handles bulk liquid commodities, dry bulk and break-bulk, including around 2.5 million tons of ferrochrome which is used in the manufacture of stainless steel, and around three million tons of magnetite, a by-product of rock phosphate operations. “China and India currently import huge volumes of magnetite for steel manufacturing,” Hills explains, “and we anticipate that the volumes going through the port will increase to around 10 million tons in the near future.”
Meanwhile, the port’s liquid bulk handling capacity is currently in the process of being expanded to meet market demand. “We’re currently in the process of finalising the construction of our second bulk liquid berth, and this has largely been driven by the requirements of bulk liquids manufacturer Sasol. When the project is completed in a couple of months’ time, it will double our bulk liquid capacity from 1.2 million to 2.4 million tons a year,” he continues.
The port imports a range of other products including 1.7 million tons of alumina a year from Australasia, which is used at the two aluminium factories sited in Richards Bay, and around 2.5 million tons of coking coal a year for the steel manufacturing industry.
The current phase of expansion includes the construction of a dry dock ship repair facility capable of handling Cape-sized vessels. In tandem with this, plans are being made to improve the port’s infrastructure over the next few years, including upgrades to the rail and road links and the power supply, and the acquisition of four new tugs between 2011 and 2014. Meanwhile, the next berth expansion is scheduled to start in 2014, which will increase the break-bulk capacity.
TNPA has a very clear vision for the long-term development of the port. A detailed plan, which has been enshrined within a Port Development Framework, proposes continuous expansion at the rate of a berth every two years to utilise all of the current port property, and then to expand westwards along the river floodplain. “We know exactly which way the port must go,” Hills says. “And we have just completed due diligence investigations to confirm the viability of all these developments.”
Currently only around 70 per cent of the port’s 3,780 hectares of land has been developed, but the due diligence investigation has recommended the acquisition of a further 2,500 hectares of land further up the river floodplain. “The horizon for this is long-term,” Hills says. “However, we’ve ensured that the spatial development framework for the City of uMhlathuze (Richards Bay) reserves the land for this purpose.”
TNPA also has its sights set on diversifying into another lucrative and rapidly expanding market sector—container cargo. To date, the port has only handled very small amounts of container traffic, but it has the road and rail infrastructure to support a major container hub. Currently the port of Ngqura at Coega between Cape Town and Durban is being developed as South Africa’s container hub; however, the sector is expanding at such a rate that within the next 10 years, a decision is likely to be needed to establish the location of the next container hub.
“We have completed two major feasibility studies to confirm the viability of the positioning of container terminals within the port of Richards Bay,” Hills says. “And we anticipate that the next major growth of container terminals will most probably be located here.”
These future plans for the port have been largely shaped by two key constraints: environmental and geotechnical. As the site is in the river floodplain, it is located on mud flats. Considerable work has been undertaken to establish the underlying geology of the area and map out the deep river channels. And construction work will be confined to the areas that are capable of providing sound footings. “There have been a huge number of environmental constraints too, some negative and some positive,” Hills continues. The City of uMhlathuze (Richards Bay) is in the process of completing an environmental management framework for the port and the industrial developments around it.
“There have been two areas of critical importance from the environmental perspective,” he explains. “Firstly, we have a mud flat area within the port perimeter that is a breeding ground for prawns. We will have to recreate those mud flats elsewhere and ensure they function properly before we plan to destroy the existing ones and begin construction. Secondly, we have Africa’s most southerly papyrus swamp. We are therefore confining the port to one side of the valley while the other side is being set aside to create nature reserves where an offset area can be created for mitigating the impacts of development, within and outside the port.”
With the development framework, environmental offset provisions and necessary infrastructure in place, the Port of Richards Bay looks set to continue its relentless expansion. Already established as South Africa’s largest cargo handling port, it may well have the potential to become one of the biggest players globally as well.