Transnet is confident it will be able to offer capacity of 6-million tonnes of coal a year on the rail line from Lephalale in the Waterberg to Richards Bay by next year, and will double that to 12-million tonnes by 2020, Divyesh Kalan, the rail utility’s commercial GM, said on Friday.

As coal mines in Mpumalanga are ageing and their resources are depleting, the future of SA’s coal industry is moving to the Waterberg region, but the lack of water and rail capacity have contributed to limiting new investments.

Kalan told the IHS Markit South African Coal Export Conference 2017 that Transnet was "on the cusp of breaking through the Waterberg". Once it had established confidence in the line from Lephalale to Richards Bay it would be able to look at extending the line to Botswana.

There have been no discussions on that extension yet with Botswana’s government or other parties.

He said over the past year Transnet had invited holders of prospecting and mining rights and mineral resources in the Waterberg to discuss their plans. It looked at project status, funding and off-take agreements.

Transnet had not changed its original plans from the existing capacity on the line of 2-million tonnes a year to an upgrade to 6-million tonnes a year in the first phase, 8-million to 10-million tonnes a year in the second and 12-million tonnes a year in the third phase, he said.

In phases two and three the axle loading is being upgraded from 20 tonnes to 26 tonnes. It is close to concluding contracts for 8-million to 10-million tonnes a year on the line.

In later phases the capacity of the line could be ramped up to 24-million tonnes a year if there was enough demand, but beyond 24-million tonnes a year a new line would be needed.

He urged the coal industry to engage with Transnet because the more mines there were in the Waterberg, the more economically viable it would be for all parties.

Nombasa Tsengwa, executive head of coal at Exxaro Resources, said the group — so far the only large-scale coal miner in the Waterberg — was happy with Transnet’s co-operation on the rail line.

Exxaro’s Grootegeluk mine has been receiving five trains a week, up from three trains previously.

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