TRANSNET’s plan to build a liquid bulk terminal for refined petroleum products at the country’s biggest port will benefit emerging fuel importers and increase supply as demand grows, says the South African Petroleum Industry Association (Sapia).

In July, Transnet issued a request for proposals to companies interested in designing, financing, building, operating and providing maintenance for a liquid bulk terminal at the Port of Durban.

Transnet National Ports Authority (TNPA), a division of Transnet, owns and manages SA’s eight commercial ports. The terminal, which Transnet wants completed by 2020, is intended to handle only refined petroleum products. The state-owned enterprise expects a shortage as demand increases. The national demand forecast for petrol, diesel and jet fuel was expected to grow to 83-billion litres in 2044 from 2015’s 29.9-billion, TNPA said.

Demand was expected from SA, Botswana, Lesotho, Namibia and Swaziland. SA also exported to other markets in southern Africa, said TNPA\s GM in charge of commercial and marketing, Lauriette Sesoko.

Sapia executive director Avhapfani Tshifularo said that 20 years ago SA had extra production capacity for refined petroleum products, and infrastructure was geared towards extra capacity, with only crude oil imported. Now SA imported more than 5-billion litres of refined petroleum products a year. This would continue to grow unless a new refinery was built.

Tshifularo said building a liquid fuels terminal on Transnet property at the coast would be much cheaper than building a new refinery. The location of this terminal is in the Island View Precinct in the Port of Durban.

"Right now there is a demand for (refined petroleum) import facilities in SA," said Tshifularo. "Land is scarce (at) the coast and there is always a need for an import facility in Durban that caters to everybody. The big oil companies have access to land and have their own facilities to discharge the product from the vessel. However, if you are an emerging player looking to import, you will struggle to find tanks to store the fuel once discharged from the vessel."

The winning bidder is expected to operate the terminal under a 25-year concession and must have at least 51% black ownership.

Sesoko said the winning bidder would have to get the necessary regulatory approvals, including environmental, for construction and operation of the terminal.

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