Transnet rail opens access for private operators
By Staff Writer
COMPANIES which were not selected to operate on Transnet’s freight rail network can apply again. As part of its plan to increase the amount of freight tonnage on its rail network, Transnet has selected 11 out of 25 companies to proceed to the next stage of contract negotiation.
The additional capacity brought by the private companies will increase freight moved by rail to 250 million tons per annum by 2029.
At a briefing last month, Transnet CEO Michelle Phillips and Transport Minister Barbara Creecy said 11 companies, which were not named, were selected to operate on a total of 41 routes and six corridors.
Phillips said the door was not closed to the companies that were not selected. She said Transnet was prepared to work with these companies to meet the requirements. Those who did not qualify this time around can apply when slots become available in the 2026/27 timetable.
The move to open up the rail network to private operators is different from the concession model that had seen Transnet being taken to court by losing bidders. With a concession, a private company gets to run a part of Transnet’s operation on its own, but with the third-party access model, private companies get to compete against each other and Transnet on the network.
Creecy said the introduction of private operators would bring much-needed investment into South Africa’s rail infrastructure.
“The Rail Policy encourages rolling stock investment by the operating companies and the establishment of the rolling stock leasing companies by both state-owned companies and private entities. This could be a key intervention for revitalising rolling stock and unlock as much as R100-billion in new investments.”
Creecy later underlined the importance of bringing in the private sector in her keynote address at the 14th Southern African Railways Association (SARA) International Rail Conference and Exhibition.
“This is a significant step in our rail reform journey and makes open access to freight rail a reality in our country. It will contribute to a more efficient, reliable and sustainable rail system that can promote inclusive growth and ensure job retention and job creation.”
The initial route allocations are:
- North Corridor: six new entrants, 15 routes for transportation of coal and chrome.
- Iron Ore Corridor: one new entrant, one route for transportation of iron ore
- Cape Corridor: two new entrants, two routes for transportation of manganese
- Northeast Corridor: six new entrants, 16 routes for transportation of coal, chrome, magnetite, fuel, containers
- Central Corridor: one new entrant, two routes for transportation of coal, containers (manganese)
- Container Corridor: four new entrants, five routes for transportation of containers, coal, sugar
As Transnet will be both a competitor and also issue contracts to the private operators, to ensure fairness, the newly created Interim Rail Economic Regulatory Capacity (IRERC) has the mandate to manage the consultation process on Transnet’s draft Network Statement. The Network Statement outlines the terms and conditions under which all operators, including Transnet, can access the rail network.
