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Monday, 24 February 2014

Botswana, Namibia to sign deal for coal railway

Botswana and Namibia will sign a deal at the end of this month to develop a 1 500-kilometre railway for transporting coal exports to the port of Walvis Bay, according to the Botswana Chamber of Mines, says Bloomberg.

“Technical glitches” delaying the Trans-Kalahari project have been resolved, said Charles Siwawa, chief executive officer of the chamber, in a phone interview last week. While he declined to give further details, Siwawa said the joint venture agreement, originally due to be signed last April, paves the way for funding initiatives and tenders.

Chinese and Indian demand for the more than 200 billion metric tons of coal in Botswana’s central Karoo basin could boost economic growth in the landlocked southern African nation, Siwawa said. The Trans-Kalahari line, which dovetails with Namibia’s plan to develop the port of Walvis Bay, requires an investment of about US$15 billion dollars, Siwawa said.

“It’s not clear yet where this financing will come from but we would like this project to proceed as soon as possible,” Siwawa said. “There are significant coal deposits in Botswana but we need an exit route for shipments to markets overseas. At the moment, Walvis Bay is the preferred route.”

Alternative export options include transporting the coal by rail to either South Africa’s Richards Bay or to Beira in Mozambique.