Antonio Ruffini
15 May 2012

Eskom dominates the domestic steam coal market in South Africa, accounting for about 116 million tonnes of the market’s 177 million tonne total.

Even though the utility aspires to reduce its dependence on coal fired technology from 90% to about 65%, it will remain the country’s largest buyer of domestic coal for a long time to come. Kiren Maharaj, Eskom’s divisional executive for primary energy, said at CoalTrans Southern Africa held in Johannesburg last week that even when coal mix is only 65%, it will still account for 30,000 MW of power. “Initially Eskom used the mine mouth model of supplying power stations but, over time as resource challenges emerged, we could not get all our coal supply across using conveyors.”

Increasingly this has been transported by road and Eskom is trying to reverse this trend. “While conveyor carried coal is the ideal it will not be possible for these supplies and the next best option is rail, which is cheaper and eliminates other negative effects in terms of road safety hazards and wear and tear on the roads. Road transport won’t be sustainable,” Maharaj says.

Eskom has been moving some 30 million or so tonnes of coal a year to its power stations by road and in 2008 it translated to 5,100 truckloads a day, and the distance covered was equivalent to driving around the world 15 times daily. Diesel consumption of the trucks carrying this coal amounted to 2% of the country’s total diesel usage. The R9.79 billion investment by Eskom in rail infrastructure will result in 140 km of new rail in Mpumalanga and a reliable rail haulage capacity of 32 million tonnes by 2018, up from 8.8 million tonnes today, which will remove 2,500 daily road truck trips for coal delivery.

In addition to the Mpumalanga road to rail initiative Eskom is also looking at the plans to provide 600 km of extra rail from Waterberg from which the utility is looking to secure some of the two billion tonnes of unsecured coal supply it will have to source for its fleet from 2020 onwards. Plans that have already been realised saw 1.3 million tonnes of coal delivered for Camden power station using a containerised rail solution in 2011 and this is expected to increase to two million tonnes this year.

A containerised solution for Tutuka power station is being constructed and expected to be delivering the first deliveries in July 2012. This has seen some of the Tutuka Standerton track reinstated. As part of Eskom’s future greening plans, biomass for co-firing and the use of limestone for flu gas desulphurisation will need to be transported, and these could have to be transported by road until a rail ready solution was in place.

9 May 2012
AllAfrica.com

The board of the South African National Roads Agency Limited (SANRAL) announced on Wednesday that Koos Smit has been appointed as acting Chief Executive. Smit will fill the role as acting CEO once Nazir Alli leaves his post on 3 June and will remain in the position while the Board undertakes the recruitment process, Tembakazi Mnyaka, chairperson of SANRAL's board said.

The board announced Alli's resignation on Tuesday. "Mr Smit, who is currently Engineering Executive, is a long-standing member of SANRAL's executive management team. He is an engineer of great experience and is widely known in the industry for his contributions to the agency's successful development and maintenance of South Africa's national road network," Mnyaka said.

The board said it had had every confidence that Smit would ensure that the daily operations of SANRAL continued at the high level the agency was known for and that it would provide him with the necessary support. The board also noted the speculation around the reason for Alli's resignation "In his letter of resignation, Mr Alli did not elaborate on factors that influenced his decision.

While acknowledging the pressure on SANRAL in recent times, the board did not believe it necessary in the circumstances to try to explore with him his personal deliberations and reflections. We can be certain, however, that this was Mr Alli's own choice," Mnyaka said. She added that Alli was not asked to resign and that in a recent performance assessment of the CEO, the board assessed him as well above average in his performance.

"It is widely acknowledged that SANRAL's record of delivery under Mr Alli has made it one of the best-performing state owned enterprises for a number of years...We believe this decision of a chief executive with a long record of service and achievement should be respected rather than interrogated," she said.

SA Commercial Prop News
6 May 2012

South Africa’s construction industry is in the midst of a significant decline – a decline which is set to continue, at least in the short term.

SA’s construction sector is still hurting from a three-year battle between companies to win work for low-priced projects. The disappointing fact is that a recovery in construction stocks has already been priced in. The JSE construction & materials index has increased by 24% since October 2011, outperforming the industrial index by 14%. Earnings forecasts of company results, however, are still bleak , with a recovery not expected immediately.

But Standard Bank research analysts Irina Gavrilova and Luresha Mudaliar say the market typically re rates the sector 12-18 months ahead of a recovery in earnings. Sentiment about a recovery in earnings has improved on news that activity has increased sufficiently to have an effect on order books. This year’s earnings show companies have not felt the effects of a recovery yet, however. Upcoming annual results announcements for medium to smaller firms won’t be occasions for celebration. A trading statement from road builder Raubex says it expects earnings and headline earnings per share (HEPS) for the year to February 29 to be between 20% and 30% lower compared with the previous comparable period. This translates into a range of between 168,2c and 193,2c a share for both. The company says its performance during the second half was influenced by intense competition for contracts and low margins in the roads sector.

Shortages of bitumen, a key ingredient in the production of asphalt, compounded the situation. Uncertainty over government policy on toll roads has also been a concern for the group. The department of transport suspended all future toll road projects last year, pending a review of the use of the user-pay principle. Raubex’s results will be published this month. Geotechnical specialist Esorfranki, which is expected to release its annual results for the year to February at the end of May, hasn’t released a trading statement. But Imara SP Reid analyst Sibonginkosi Nyanga recommends that its share be added to investors’ portfolios on the basis of what is to come. Nyanga says investors should focus on growth in the company’s order book and an expected increase in its margins. He says this year’s results should be better . Meanwhile, Stefanutti Stocks expects earnings and HEPS to be between 15% and 35% lower than those for the comparative period.

Nyanga rates the share a hold . Stefanutti recently purchased Cycad Pipelines, diversifying its operations. It also announced that it had secured a contract mining project from Ikwezi Mining in KwaZulu Natal. The project is expected to be worth in excess of R1bn. Management at all three firms have expressed cautious optimism about the prospect of a recovery. Others are more positive. Building materials supplier Afrimat has been a star performer, despite fierce competition. Its share has performed excellently, rising 68,6% in the past year. Such is the confidence of CEO Andries van Heerden that the company declared an early dividend in March, two months ahead of the release of its results for the year to February — expected next week.

It announced a final dividend of 13c/share, resulting in a total dividend of 19c for the 12 months to February . This compares with a total dividend of 17c in the previous comparable period. Afrimat estimates that profit before tax for the year to February will be between R115m and R120m, compared with R108m last year. Given that its dividend policy is three times cover (meaning the number of times the profit could have paid the dividend), the company says its dividend is appropriate. In March, Afrimat purchased the Clinker Group, a supplier and processor of raw clinker to the concrete manufacturing industry. The acquisition will further diversify Afrimat’s business. The group says the combined strengths of its units will yield new opportunities and increase profitability. Afrimat also assumed ownership of Glen Douglas, a metallurgical dolomite mine south of Johannesburg, last year. Its expansion of the quarry is expected to make it one of the largest in Afrimat’s portfolio. But what does this mean for the investor?

For the moment, Gavrilova and Mudaliar believe construction shares are fairly valued on an absolute basis. They advise investors to be cautious in the light of general economic conditions. But growth in work outside SA and an increase in public-sector investment as well as private-sector projects are expected to drive future growth. By channelling planning through the Presidential Infrastructure Co-ordinating Commission (PICC), government has stepped up its effort to unblock project delays. The commission has identified 43 projects valued at about R3,2trillion, though financial feasibility has not been established for all of them.

Speaking at a recent conference on infrastructure, deputy president Kgalema Motlanthe said government recognised that the pace of infrastructure development was lagging behind SA’s needs. “The PICC mandate is to develop a 20- year infrastructure pipeline, to ensure that we can plan ahead and move away from the stop-start syndrome around the building of infrastructure. “This will allow us to ensure better financial mobilisation, provide greater certainty to the construction industry, give educational institutions a framework around which to plan their skills development strategies, and to provide a roadmap for investors and communities.” How government will deal with the suspension of new toll road projects, however, is still unclear.

The private sector, which is sitting on R520bn in corporate deposits, will also eventually begin investing in capital expenditure. An increase in activity will come at higher margins, improving companies’ earnings outlook considerably. With an already large jump in order books of almost all companies in the sector, growth prospects look good.

25 Apr 2012
Buanews.com

Durban and Gauteng as well as the transport corridor between these two key logistics centres will be alive with work, as five key projects get under way in the next five years, the Minister of Transport Sibusisu Ndebele says.

Presenting his Budget Vote speech in Parliament on Wednesday, Ndebele announced five key transport projects which would be undertaken in the next five years in the Durban-Johannesburg corridor. Ports, roads, rail - including high speed rail, logistic hubs and land-use plans - would all be developed.

Ndebele said the focus would be on sharpening up freight logistics to ensure economic growth as South Africa played an important role in the shipping of goods in and out of Southern Africa. The projects in the Durban-Johannesburg corridor include:

* the development of Cator Ridge as a dry port
* the sale of the Durban International Airport to Transnet for setting up a dug out port
* the extension of commuter rail to reach Pietermaritzburg
* the development of Harrismith as a logistics hub
* the setting up of several logistics hubs in Gauteng.

Ndebele said roads maintenance needed to continue, particularly as freight carried by roads will grow by between 200% and 250% over the next 20 years. Added to this, the poor state of many access roads had contributed to soaring rural services and had made it difficult for those in rural areas to access medical and other services.

Major roads projects were also being undertaken by the SA National Roads Agency Limited (SANRAL) in among other places the Eastern Cape, Durban's North Coast, near Harrismith and between Ventersburg and Kroonstad. Added to this, the department's S'hambe Sonke Road maintenance project, launched in April last year to fund the maintenance of roads, would be ploughing R6.3 billion into overhauling roads across the country.

In all, R1.2 billion had been allocated to KwaZulu-Natal, R1 billion to Eastern Cape, R1 billion to Mpumalanga, R934 million to Limpopo, R566 million to Gauteng, R447 million to the Free State, R411 million to the Western Cape, R308 million to the Northern Cape and R501 million to the North West. Ndebele said the department's R38 billion budget is expected to grow to R48 billion by 2014/15. Of the R38 billion, the department has allocated R10 billion to the Passenger Rail Agency of SA (PRASA) - of which R5 billion will be used for the acquisition of new rolling stock - and R18 billion has been allocated for roads (including R8.8 billion for SANRAL). The remaining R10 billion has been allocated to public transport, of which R5 billion will go towards bus subsidies and R5 billion to the taxi recapitalisation programme and BRT programmes.

DA member Ian Ollis suggested that Ndebele could integrate the various electronic cards used on BRTs and the Gautrain, as well as the card PRASA plans to launch for Metrorail passengers, into a single card. Ollis pointed out that all the cards used the same technology and software and that all that was required was for them to be integrated on their various databases, adding that such an initiative could be completed so that a single card was ready by October next year. Such a card, he said, would then be similar to London Transport's Oyster Card, which allows commuters to use the same card to travel on buses and trains in the city.

However, the Deputy Minister of Transport Jeremy Cronin said although a single travel card to cover the country's various existing e-cards for public transport was a good idea, it would not benefit all travellers.

Idéle Esterhuizen
19th April 2012
Engineering News

The launch of the Passenger Rail Agency of South Africa’s (Prasa’s) request for proposals (RFP) for new rolling stock marked the dawn of a new era for public transport in the country, said Transport Minister Sibusiso Ndebele.

The Minister on Thursday formally opened the bidding process for the R123-billion contract to manufacture and supply 7 224 new commuter coaches for Metrorail as part of Prasa’s New Rolling Stock Procurement Programme that would run over 20 years. Ndebele said at the RFP launch, held at the Braamfontein depot in Johannesburg, that improved rail infrastructure would offer an affordable, safe, reliable and modern passenger rail service, amid ever-increasing fuel prices.

Government is investing R137-billion in the New Rolling Stock Procurement Programme, of which R123-billion would go towards acquiring new coaches, while R14.5-billion would be invested in infrastructure upgrades and the construction of new depots. Prasa CEO Tshepo Lucky Montana said that bidders would have to adhere to government’s set localisation target of 65%. “This means that the bulk of the successful bids will benefit South Africans on an unprecedented scale.”

The preferred bidder would be required to set up a factory and supply chain in South Africa, employ local people and transfer skills to Prasa. “The project will not only change the focus of public transport in South Africa to rail, but it is the largest project of its kind in the country with the potential to create 65 000 jobs over the next 20 years and revive the local, failing rail engineering sector,” Montana enthused.

Prasa enterprise programme management office head Piet Sebola told delegates that a bidding document would be published for comment from April 24 to May 7, while bidders would be briefed on the document on May 9 regarding economic, technological, financial and legal requirements. Bidders would be given time to optimise their RFPs until July 11.

The RFP evaluation process would run from August 27 to September 10 and the preferred bidder would be announced by the end of November. The first trains are expected to arrive between July and December 2015. Montana stated that in preparation for the new rolling stock, the agency would, through its modernisation programme, undertake a series of direct infrastructure investments valued at about R25.9-billion over the next three years.

These funds would finance capital investment projects at station level and at key national high-passenger demand corridors in KwaZulu-Natal, the Western Cape and Gauteng. “We have chosen strategic high-passenger corridors as our key upgrade where the demand for our service is quite high with an average of 30 000 to 60 000 passengers at peak hours,” he noted.

The renewal project formed part of Prasa’s Vision 2015, which aims to position South Africa as a world-class transport provider in high-volume corridors by 2015. Earlier this year, the government announced the first R5-billion allocation to Prasa out of the budgeted R137-billion. Of this, R4-billion would be reserved for the procurement of the first new rolling stock, while R1-billion would be used for the upgrading and construction of rail infrastructure such as signalling and depots.

Mike Mueller
Business Day
2012/04/18

THE Planet Under Pressure conference in London last month was a gloomy event. Organised by the world’s environmental-change programmes, it brought together leading scientists and science policy experts.

Three thousand participants discussed the latest information and thinking on climate change and environmental sustainability, aiming to influence the United Nations’s (UN’s) Rio+20 summit on sustainable development. But while science can provide many pointers, there was no great optimism that the world’s political leaders would take notice of any advice. An excellent example of the problem is offered by the current controversy about tolling Gauteng highways. But it is useful, first, to consider the larger perspective.

There is wide consensus that human activity is putting the earth under pressure. It is not just that global warming will disrupt food production. Some poorer countries already face social collapse if they don’t fix the governance and management of their water resources. On other fronts, from fish stocks to shortages of phosphates for farming, the picture is of a complex structure that is systematically being stretched to breaking point and beyond. Welcome to what the scientists are now calling the "Anthropocene".

We now live in an age in which humans are no longer simply the victims of nature and natural forces. Like it or not, nature is now being shaped by people. The good news from London is that science is getting much better at understanding the mess that humankind is making and charting ways out of it. So, we were told, global warming could be held at bay for a couple of decades while more renewable forms of energy are introduced. "Geo-engineering" techniques — such as mimicking the cooling caused by volcanic explosions and using aircraft to deliver "sunscreen" to the stratosphere — are being investigated.

Food-supply challenges could be managed by reducing waste in the system and encouraging dietary changes. As one speaker put it, we need to "garden forward" and make the new world more sustainable rather than nostalgically trying to "garden backwards", to conserve or recreate the natural world that we inherited. The challenge is to accept that responsibility and act on it. So the conference conveners called for much greater focus on practical solutions.

But they also emphasised that solutions would be effective only if there was visionary leadership willing to implement them. And the bad news is that there is little of that kind of leadership in evidence. This is where the South African debate about toll roads is relevant.

Transportation is the source of many environmental problems. Most of the energy for transport comes from carbon-based sources such as oil or coal-fired electricity. As serious, the combination of subsidised roads and cheap carbon-based fuels has encouraged sprawling settlements that lock cities and countries into energy-intensive habits for decades and even centuries.

Yet roads and railways are also the arteries of economic life and the challenge is to provide them in ways that maximise their benefits and limit the damage they do. More than 200 years ago, British author Daniel Defoe wrote about the challenges posed by the rapid growth of London, which demanded the daily transport of huge quantities of food, fuel and building materials. He singled out the contribution of the toll roads that were established around the city, enabling its needs to be met far more efficiently than before. No one complained, he said, because "the wagoners either perform in less time, or draw heavier loads, or the same load with fewer horses; the pack-horses carry heavier burdens, or travel farther in a day, and so perform their journey in less time; all which tend to lessen the rate of carriage, and so bring goods cheaper to market".

Fast-forward to the Gauteng Freeway Improvement Project, which has been talked about for more than 10 years. Proposals to restrict access to improved lanes for public transport and paying users were always on the table. As far back as 1994, the African National Congress’s Reconstruction and Development Programme (RDP) talked about road tolls (calling them "access levies"), saying "commuters should be encouraged to use public transport and should be actively discouraged from using cars".

The RDP’s recommendations were part of a broader strategy, "to break down apartheid geography through land reform, more compact cities, decent public transport…". Those goals are also vital to creating more environmentally friendly cities. But while it is easy to frame attractive visions, the job of politicians is to use their political capital for the difficult bit, the implementation. So they need to be out there explaining the intentions of the tolls and how they can be made to work to create better cities. If not enough attention was given to complementary activities, such as improving public transport beyond the Gautrain and the bus rapid transit systems, this is what should now be addressed. Unfortunately, few politicians seem willing to take responsibility for the short-term social costs that will help to build more efficient and people-friendly cities in the longer term.

Civil society is equally at fault. Business remains committed to its own short-term bottom line. Trade unions that called for an end to apartheid geography are campaigning against measures designed to achieve that goal. Environmental organisations that usually talk loudly about environmentally friendly development are strangely silent; churches that preach environmental values and social equity have abandoned those pulpits.

As for the media, when Primedia’s "Lead SA" campaign radio stations call for boycotts and public protest, their conception of leadership reveals itself to be limited to listeners’ comfort zones and advertisers’ rands. In this, Gauteng e-tolling is a microcosm of the political challenges facing the global environmental movement. Global governance systems such as the UN are driven by governments that protect their immediate interests and find it difficult to agree on action quickly enough. But what alternatives are there?

The final declaration from the Planet Under Pressure conference struck a hopeful note, suggesting that "diverse partnerships amongst local, national and regional governments as well as business and civil society provide essential safety nets should singular global policies fail". The argument that great advances could be made by taking many small steps is compelling. But those small steps will always involve some local sacrifices. In Gauteng, for instance, car owners will have to carry more of the cost of urban transport than their less fortunate compatriots who get to work by minibus taxi.

Such sacrifices will not be made unless leaders from all sectors are prepared to share them and help to shape the change rather than hoping that it does not have to happen in their own back yards. Asking for local leadership to solve global problems is a somewhat desperate call, but an important one, if our planet is to negotiate safely the storms into which it is heading. As always, the longest journey begins with the first steps. In Gauteng, that may mean stepping into a South African National Roads Agency office and buying an e-tag.

• Muller is a member of the National Planning Commission, infrastructure adviser at the Development Bank of Southern Africa and visiting adjunct professor at the Wits Graduate School of Public and Development Management.

Terence Creamer
Engineering News
13th April 2012

The prevailing shortage of engineers has been identified by the Presidential Infrastructure Coordinating Commission (PICC) as a major potential impediment to the effective implementation of South Africa’s ambitious infrastructure investment programme, which currently comprises 17 Strategic Integrated Projects, or Sips.

The PICC’s newly released infrastructure plan indicated that there were nearly 23 000 registered engineers in South Africa, of which about 5 500 were working in the public sector, including at the large State-owned companies, such as Eskom and Transnet. Economic Development Minister Ebrahim Patel, whose department acts as the secretariat for the PICC, indicated on Friday that as part of a multipronged response to the “bottleneck” government would consider further easing immigration rules for technical professionals.

He said the main thrust, however, would be to “grow our own timber” by beefing up the capacity of local universities to produce engineers at a rate commensurate with the needs of the infrastructure programme. In addition, resources would be directed towards the Further Education and Training colleges to train technologists and technicians. However, he acknowledged that it had become difficult for graduates to gain work experience given the recent stop/start nature of public and private investment initiatives.

Efforts would also be made to attract those South African engineers currently living and working abroad to return to South Africa to apply their skills to what was emerging as a multidecade, multitrillion-rand programme to expand energy, transport and water infrastructure. “A third [component] is to ease the rules relating to the immigration of scarce skills,” Patel said at a gathering hosted by the PICC in Ekurhuleni to expose officials from all three spheres of government to the main components of the infrastructure plan. “If there are people with excellent skills that want to come and live and work in South Africa, we are opening it up for them. But we will open it up mindful of the need to couple that with skills transfer arrangements, so that, in the long run, we build the domestic skills base.”

He stressed that there was nothing wrong with encouraging people with scarce skills to “settle” in South Africa. “It is a very important part of ensuring that we have the necessary talent pool to draw upon.” But the comments were made against a backdrop of concern within the local engineering community that existing engineering talent was not being appropriately deployed. In fact, South African Institute of Civil Engineers CEO Manglin Pillay told Engineering News Online recently that the poor implementation of government projects had left a number engineers unemployed, or under-employed.

This had forced many to ply their trade and settle elsewhere. There was also concern that the Department of Home Affairs might not be fully aligned to the proposed immigration easing agenda. New rules were reportedly being contemplated that could make it even more onerous for those seeking South African work permits. Such individuals and their families might, in future, be required to report in person to designated embassies to deliver the necessary documentation. In the past, courier services, or agents could be employed.

11/4/2012
http://www.southafrica.info

South African state transport and logistics company Transnet has announced the details of a R300-billion investment in infrastructure that it says will create over half-a-million new jobs while making its freight rail division the fifth-largest in the world.

Announcing South Africa's new multi-billion rand infrastructure drive in his State of the Nation address in February, President Jacob Zuma highlighted two key goals of the programme: creating new jobs, and making it easier to do business in, and export from, the country.

Briefing journalists on Tuesday, Transnet CEO Brian Molefe said the state company's prime objective was "to invest in building capacity to meet validated market demand that will enable economic growth". 'Significant modal shift from road to rail' South Africa's rail, port and pipelines infrastructure would be significantly upgraded and expanded over the next seven years, resulting in "a significant increase in freight volumes, especially in commodities such as iron ore, coal and manganese," Molefe said, while leading to a "significant modal shift from road to rail".

The lion's share of Transnet's R300-billion capital investment programme, R205-billion, would be spent on rail projects - R151-billion of this on freight rail - as the company pushed to increase freight rail volumes from about 200-million to 350-million tons by 2019, while increasing its market share of container traffic from around 79% to 92%. This increase would significantly reduce the cost of doing business in South Africa, Transnet said, citing internal studies showing that rail in the country was on average 75% cheaper than road transport.

A large-scale shift in freight transport from road to rail would also "address costs, congestion and reduce carbon emissions," the company said. Ports, pipelines, procurement, skills Containers handled by South Africa's port would grow from 4.3-million to 7.6-million TEUs, while petroleum products conducted via pipelines would increase by over 3-billion litres to more than 20-billion litres by 2019. The associated procurement programme would boost local industry, with about half of the R78-billion set aside for locomotives to be spent on local suppliers.

And skills development would also get a big shot in the arm, with R7.7-billion to be spent on training by 2019, including R4.7-billion on bursaries and grants. Transnet said that R213.6-billion of the required funding would be generated from operating cashflows, while the rest - R86.5-billion - would be raised on debt capital markets. The capital investment programme was key to South Africa's growth objectives, Molefe said. "This strategy aims to deliver a lasting economic, social and environmental value to society."

Peter Luhanga
4 April 2012
AllAfrica.com

In order to keep major road works, such as the IRT expansion along the west coast corridor to Atlantis, on track, the City of Cape Town has had to import bitumen for road surfacing as there is a shortage of local supply, which has also affected small contractors awarded road repair tenders.  Similarly, the South African National Roads Agency (SANRAL) is also having the import the petroleum by product in order to stay on schedule.

Bitumen (also known as asphalt) - is residue of petroleum distillation used in the surfacing of roads - has been in short supply since October last year. In February, City of Cape Town Mayoral Committee Member for Transport, Roads and Stormwater, Brett Herron said the bitumen shortage was due to "difficulties" at the Durban and Gauteng refineries, while the Cape Town refinery was shut down for maintenance from February 17 until April 2.

City road projects that were feared to be affected were the Kalk Bay main road renovations, many of the metro road rehabilitation projects; the Non Motorised Transport (NMT) projects and the Integrated Rapid Transit (IRT) intersection projects. Yesterday Herron said the city has had to import 4500 tones of bitumen from Malaysia the result being that "so far no projects are affected". "There are delays here and there.

There has been delays (in roads projects) but they have been alleviated with the importation of bitumen," said Herron. He said Cape Town's Chevron refinery re-opened on Monday and would be able to supply bitumen locally. But the bitumen shortage has had a negative effect on contractors who have been awarded tenders for road construction and repair work, said SANRAL regional manager Kobus van der Walt.

Van der Walt said demand at present was greater than supply and to make up the shortfall, bitumen had to be imported, with COLAS (Cold Asphalt South Africa) importing 3 800 tons of the product. "The situation has normalised for a month or so but it's definitely going to pick because of the need," he said. He said all SANRAL major projects had been affected by the shortage of the bitumen including the maintenance of the R27 and N7. "All the roads, especially refill work in the West and Northern Cape." He said the continuous shortage of bitumen meant that SANRAL could not spend their budget and contractors who had been awarded tenders were losing out as they were waiting on site for bitumen to become available while paying for machinery hire and staff salaries despite little or no work being done.

COLAS marketing manager Premala Singh confirmed that her company was importing bitumen to alleviate the crisis. Singh said when the country was first hit by bitumen shortage in October 2011, the Raubex Group, Much Asphalt and Colas initiated the import of the first bulk shipment into the country which was offloaded at the Durban port in November. Last month, further supply of bitumen from Asia was offloaded at docked at Cape Town harbour, said Singh.