Transnet stands firm on decision to allocate capacity to emerging miners

Transnet has hit back against criticism of its decision to allocate capacity to emerging miners, saying that it will not affect the capacity already promised to major manganese exporters.

Capacity in this context refers to the allocation of resources, specifically the amount of manganese ore that Transnet has designated for exportation to different mining companies

The state-owned entity said that the decision was made to foster a more inclusive and competitive environment.

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As such, it has allocated capacity to six new entrants under the Manganese Export Capacity Allocation (MECA) III programme, which brings the share of emerging miners’ allocation to 25% of the total available capacity.

“The special terms governing the current allocation of uncommitted tonnage under the existing contracts allow Transnet to re-allocate the whole or any portion of the uncommitted tonnage, currently 15%, in order to facilitate new entrants into the export market,” the entity clarified in an issued statement.

Transnet affirmed that it believed that this was “a fair and sustainable way of introducing additional participants in the system, as opposed to starting from a zero-based allocation”.

Expansion of the manganese channel

The entity confirmed that it will also be advancing with the expansion of the manganese channel, collaborating with established as well as up-and-coming miners in the industry.

Transnet said that the measures being taken comprise the transfer of the current manganese terminal situated at the Port of Port Elizabeth, which can handle up to 10 million tonnes per annum, to a brand-new export terminal at the Port of Ngqura. This new facility will have a capacity of 16 million tonnes per annum and is scheduled to be inaugurated by December 2027.

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“On the rail infrastructure TFR has completed confirmation of the designs for the extension of existing and the construction of new crossing loops for longer trains, and the equivalent ramp up in locomotives, wagons and operational resources, resulting in an increase in slot capacity on the line, increasing capacity by 6mtpa on rail,” the statement read.

Transnet is also planning to expand its manganese export capacity (rail, terminal and port infrastructure) to 6 million tonnes per annum through the Saldanha export channel.

“It is important to emphasise that Transnet is fully committed to collaborating with industry in fast-tracking the expansion of the manganese channel, for the benefit of all industry players and the South African economy,” the statement concluded.

Compiled by Devina Haripersad