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This thread will highlight the HUGE capital developments underway and planned for Richard's Bay in northern KZN. At present over R15 billion in development is on the go in this town that was only born when the harbour was created in the late 60s early 70s.

It is South Africa's largest port in terms of break bulk cargo, and has the greatest potential in terms of expansion, for less than 25% of the port is developed.

Read on and find out more
 

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Indian giant also mulling auto investment

Indian multinational Tata Steel could be building a motor-assembly plant in Richards Bay in conjunction with the proposed construction of its R600-million ferrochrome smelter. The company’s overseas project manager, Somdeb Banerjee, says the group is intent on globalisation and is keeping its hand open.

“Our two options are either Coega/Port Elizabeth or Richards Bay,” says Banerjee.

The R600-million plant was proposed at the eighth public meeting hosted by the multi- national in Richards Bay and attended by more than 140 people. Stakeholders also discussed the proposed land swap between Pulp United and Tata, after paper giant Mondi Business Paper voiced concern over possible contamination of its products if Tata built its plant adjacent to the Mondi factory.

The new site for the smelter, which is expected to provide 129 direct and 1 000 indirect jobs, is currently undergoing a site-specific environmental-impact assessment (EIA).

The CSIR’s Rob Hounsome says a ‘cocktail’ of combined industrial emissions will be investigated in the EIA, with particular scrutiny being given to suburbs within close proximity of the Alton site.

Banerjee adds that the company is ISO 14001-compliant and that the site-change benefits the local uMhlathuze municipality, Pulp United and Tata.

“We would not compromise the health of the public if we felt our plant would have a negative impact, but we are intent on building this plant and, if it cannot happen in Richards Bay, it will happen elsewhere.

“We identified nine locations and finally chose South Africa over Australia, largely due to the persuasion of the mayor and his officials. But we are becoming a global company and, while we want to be in Richards Bay, there are other options,” says Banerjee.

Another public meeting will be held next month to give the findings of the EIA. The municipality has brokered this to be fast-tracked and, if all goes well, construction could start in November. Smelter construction should be completed by February 2007.

uMhlathuze mayor Denny Moffatt has welcomed the possibility of an assembly plant.

He says this would create great ‘synergy’, as a major wheel-manufacturing company, which is being kept under close wraps, could possibly also locate to the city.
 

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Way finally being cleared for coal-terminal expansion

South Africa's coal-miners are on track to export more coal after an announcement that Spoornet would be going ahead with its plan to increase the output on the Mpumalanga-to-Richards Bay line by about 16-million tons, with the Richards Bay Coal Terminal (RBCT) to be expanded to mirror the line's new nameplate capacity.

News of the expansion has been eagerly awaited by a number of coal-miners for many years, but announcements have failed to materialise due to a range of disputes, more recently around the issue of the rail tariff.

This has meant that miners that have either not had access to the privately-owned terminal or were seeking to expand their entitlements have been severely constrained, despite the promise of a 10-million-ton expansion.

Some years back, the existing owners agreed to relinquish their rights to the expansion to allow new entrants, particularly black-owned coal companies, which were considering a competitive terminal, then known as the South Dunes Coal Terminal (SDCT).

The SDCT consortium, now referred to as the phase-five consortium, comprises companies such as Eyesizwe Coal, which has some entitlement but is seeking to expand it, Kumba Resources and the Golang consortium, which includes various empowerment and foreign interests.

A keen observer of developments and Kumba Resources CEO, Dr Con Fauconnier, indicated two weeks ago that the project was, at last, close to being signed off.

He indicated that a deal, which was being delayed by a final tariff determination by Spoornet, was weeks away.

Kumba is reliant on the terminal's fifth phase for its joint venture with Eyesiswe, Inyanda Coal, which will push out a million tons of coal a year. Estimated capital expenditure for the project is some R184-million for the 16-month construction period but, at the time of the results presentation, Fauconnier could not indicate an estimated start-up date.

However, he indicated that some of the planning and site preparations at the port were already under way in anticipation of a positive outcome.

It is likely that Transnet will want to avoid the creation of any possible embedded derivative structures as it set the new tariff framework, and that it could be modelled on developments on the Sishen iron-ore line, where the contract template has been overhauled.

The Sishen agreement is a rand-based contract that saw a move away from the embedded derivative structure, which arose due to the tariff link to the dollar price as well as the iron-ore price.

Transnet will be moving away from a 10-year 'one size fits all' contract and replacing it with individual contracts.

At the same time, the company managed to negotiate additional tonnage that will complement its expansion projects and agreed with Transnet to a R7,5-billion deal to expand the line's capacity.

The Sishen Expansion Project, due to start up in the second quarter of 2007, will see an extra 10-million tons being produced each year at a cost of R2,96-billion.

Phase one of Sishen South will add an extra three-million tons a year for a capex of R999-million and is due for start-up some two quarters after the Sishen Expansion Project.

But it finally looks as if the project is rolling, as news reports indicated yesterday that Spoornet, subsidiary of state-owned utility Transnet, is set to move on its capital expansion project.

Business Day indicated that CFO Nick Thompson said that the utility's R10-billion expansion plan to improve capacity on the line would be allocated over the next five years.

Money is due to be spent on replacing overhead cables, expanding capacity, installing a new signal system as well as modernising the locomotive and wagon fleet, last spent on some 13 years ago.

The utility will spend some R2,5-billion over two years on the installation of signalling systems and upgrading the line between Richards Bay and Ermelo.

Meanwhile, Business Report reported CEO Siyabonga Gama as indicating that capacity on the line would be increased from 70-million tons to 86-million tons a year over two years.

This would mainly be done through the refurbishment of rolling stock.

A further increase is, according to Business Report, on the cards to increase the line to 41-million tons for R5-billion.

Gama's announcement comes on the back of a planned increase to the Richards Bay Coal Terminal (RBCT), which has finally been green lighted.

Scheduled for construction next year, the terminal is also to be expanded by 16-million tons to 86-million tons of coal capacity a year.

Most of South Africa's coal is shipped through this terminal, the world's largest coal-export facility.

But producers who own the terminal - among which are BHP Billiton, Anglo Coal and Xstrata, often lament that the rail system is not up to scratch.

The additional 16-million-ton expansion project, first announced in mid-2000, has been subject to countless delays.

The main issue was that additional capacity would be set aside for black economic-empowerment companies, and a dispute arose between Transnet and the National Port Authority as to the size of this allocation.

But some 80% of the increases to the line's capacity has been allocated to Kumba, as part of the 25-year deal, which saw it move to a rand-based agreement with Transnet.
 

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Land swap opens way for chrome project


India’s Tata Iron and Steel Company (Tisco) expects to break ground for its multimillion-rand ferrochrome smelter in Richards Bay by October, after a land swap was successfully negotiated.

But this is subject to approval of an environmental-impact assessment (EIA) on the new site for the smelter. A memorandum of understanding (MoU) has also been drafted by all the parties to allow the EIA process to proceed at a fast pace. The land swap had to be negotiated when Mondi Business Paper, which was to be the neighbour of the Tata plant, raised concerns over a high potential of contamination of its products. A spokesperson says Mondi raised its concern through the EIA process which was being completed on the site.

“Most of our products are used for food packaging and we were concerned about wind-blown dust particles and chromium-compound material contaminating our products,” he says.

This was further compounded by Ezemvelo Kwazulu-Natal Wildlife’s concern about a 40 ha area of ‘Kwambonambi grassland’ on the proposed site, believed to be endemic to the area.

The Richards Bay local municipality, uMhla-thuze, was forced to mediate a land swap with pulp company Pulp United.

uMhlathuze mayor Denny Moffatt, who was in talks with Tisco management last week and has been coordinating the entire process, says the ferrochrome giant is inspecting the new site and is redesigning the smelter according to the new site.

“Tisco has to look at a host of issues, such as drainage, power supply, sewage, roads and geotechnical studies,” says Moffatt. He adds that the exchange has been time-delaying, but the MoU, which has been signed by all the parties, is intended to speed up the EIA process.

According to uMhlathuze municipal manager Tonie Heyneke, the matter was taken up by the Department of Trade and Industry to allow the land-swap application for Tisco and Pulp United to continue.

Tisco proposes to build a R650-million plant that will initially produce 120 000 t/y and double this capacity to 240 000 t/y by 2008/9.

The multinational plans to produce high-carbon ferrochrome with a 64% chrome content and supply this to stainless-steel producers in Western Europe, Taiwan, Korea and India.
 

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let's try to generate some discussion... we don't want just a news article thread ;) Although perhaps that is what people do want ... :)
 

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I lived there in 1998/99 whilst building the new empangani prison and it was like the wild west then. Crocodiles on the storwater pipes and in the fountains of the mall, hippos crossing the road all time and generally the hardest drinking town Ive lived in.
Great potential
 

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Spire: Needed to put up info before we can start any discussion, if people dont know anything about the place they can hardly discuss anything :)

R15 billion is alot of investment. RB's growth has been greater than 7% every year for the last 7 years! pretty impressive
 

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hmm...a town of drunks? But besides that and watersports, there is not much recreational attivities, unless you want to go to the game parks every afternoon!
 

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true, but you live in RB to work not play. Durban is only 55min away . There were plans for a casino on the canals in RB and there are some decent beaches there. Its a small coastal induatrial town, not much call for art exhibitions
 

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yeh the casino is up and working, and the Boardwalk dev has progressed nicely. They are now building apartments on the waterfront, overlooking the harbour there. Not flashy ones like in durbs and CT, but reasonably priced!
 

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I actully lived in the tuzi gazi waterfront appartments and they were great, we fished off the balcony and watched the sharks come in after the rains. a bit uneasy when you see the canoists paddeling by and a 25ft jonny was there the day before.
boardwalk was OK and the waterfeatures out front was where the crocs ended up , Any pics of the RB municipal offices. They were great
 

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TATA is but one signature away from approval for their now R750m ferrochrome smelter. They have secured a site swop with Pulp United. So now both projects will go ahead, with combined investment of R1,7bn for the city.
 

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umm...i havent been to RB in over 7 years, so i dont have any...will search the net!

RB has investment levels of R7bn at the moment, with another R12bn in the pipeline. Not a great place to live (have a mate there) but lots of money to be made. and as u said, its important to the country and kzn.

It has regularily achieved growth of 10% per year
 

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Tata will no longer be building their Tata vehicle assembly plant in RB however, that is now going to be built in Durban, due to logistical reasons.
 

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so will TATA still invest in the ferrochroem smelter?
where will TATA builkd ht e veihicle assembly plant in Durban? not much land left at that scale
 

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Discussion Starter #19
Tata are still building the ferrochrone plant in RB.

the vehicle assembly plant will either be built at riverhorse or in the south basin near umbogitwini.
 

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Discussion Starter #20
The attraction of Richards Bay IDZ

Situated on South Africa’s northeastern coast, the Richards Bay IDZ is proving to be a much sought-after investment destination.

The Richards Bay Industrial Development Zone (IDZ) initiative is gaining momentum with the installation of bulk services and confirmation of a number of projects set to establish in this strategically located IDZ.

The IDZ’s main advantages include, inter alia, that:


The IDZ is located immediately adjacent to the Richards Bay deepwater harbour, on the northeastern coast of South Africa;

Production costs are among the lowest in the world;

The established businesses in the area provide numerous down-streaming opportunities and vital support services to incoming companies;

The city of uMhlathuze boasts an enviable environment and varied lifestyle options.
Already, projects valued at some R3bn are at the negotiation stage, with additional projects worth a further R17bn currently being assessed.

Richards Bay IDZ will initially comprise 370 hectares, with future potential of more than 1000 hectares. The first four sites have been designed to allow for the positioning of various tenant-types within areas specifically suited to their particular requirements.

Tenants are expected to begin establishing within six months, in order to take up export opportunities which will be afforded to them through their extremely close proximity to the port, a dedicated customs facility and the incentive of non-liability for import duties or VAT. Tenants will also be able to utilise incentive programmes, in respect of establishing new companies, increasing competitiveness and innovation, the importation of new machinery and the establishment of export markets.

A further advantage for industries locating in the IDZ is the immediate supply of feedstock, including: aluminium, heavy metals, various chemicals, wood, pulp, paper, agricultural products, gas, coal and electricity (second lowest in the world).

The industrial prospects offered by the Richards Bay IDZ are further enhanced by an enviable lifestyle. Zululand’s sub-tropical climate, pristine coastline and the close proximity of Africa’s ‘big five’ in the many nearby game reserves and parks makes the Richards Bay region one of the most sought after investment destinations in South Africa.
 
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