TNPA East London. Port Overview Presentation
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1 TNPA East London Port Overview Presentation Date: 13 October 2015
2 DISCLAIMER The content of this presentation is for general information purposes only and should not be construed as creating an expectation of any nature whatsoever regarding the way forward relative to the issues under consideration. Rights are fully reserved not to proceed in respect of the issues under consideration and to alter views expressed. The basis upon which to proceed relative to the subject matter of this presentation, or not to proceed as the case may be, will be developed outside the ambit of this presentation and for this specific purpose the content of this presentation should not be relied upon. Please be guided accordingly.
3 TABLE OF CONTENTS 1. Introduction to Transnet Structure 2. TNPA Business Overview Summary 3. Core Functions of Ports 4. Port of East London Business Overview 5. Port Challenges and Interventions 6. Port Volumes 7. Capacity Management 8. Port Development and CAPEX 9. Operations Phakisa Initiatives 10. New Business Development Business Opportunities 11. Stakeholder Engagement Platforms 12. Our People Our Community
4 INTRODUCTION: TRANSNET STRUCTURE
5 TNPA BUSINESS OVERVIEW SUMMARY Four Core Business Activities Infrastructure Marine Services Dredging Lighthouses The National Ports Authority is a landlord Port Authority that provides port infrastructure and maritime-related services at the South African ports. Key business parameters : 9 operational ports coastline approx 2 800km 106 berths (20 container,26 dry bulk, 38 break-bulk,16 liquid bulk, 6 automotive 57 maritime craft (30 tugs, 9 pilot boats, 7 workboats, 3 pilot helicopters, 5 dredgers, 4 survey boats) permanent employees countrywide Eight Operational Ports Core Business & Key Commodities Core Business: Infrastructure Capacity planning, Development, Maintenance Marine Services Pilotage, Tug and Berthing Services Dredging Maintenance dredging and Hydro graphic surveys Lighthouse Services Provision of Aids to Navigation Port Nolloth Saldanha Bay Cape Town Richards Bay Durban East London Ngqura Port Elizabeth Mossel Bay Ports key commodities: Durban Containers, Autos and Liquid bulk Richards Bay Coal Saldanha Iron Ore Port Elizabeth Containers and Autos Cape Town Containers and Fruit East London Autos Ngqura Containers Mossel Bay Liquid bulk
6 CORE FUNCTIONS OF PORTS (National Ports Act, Act 12 of Section 11) LANDLORD MASTER PLANNER Promote the use, improvement and development of ports, and control land use within the ports, having the power to lease port land under conditions it determines. Plan, improve, develop and maintain port infrastructure. CONTROLLER OF PORTS NAVIGATION Make and apply rules to control navigation within port limits and approaches, ensure protection of the environment and ensure safety and security within port limits. CONTROLLER OF PORTS SERVICES & FACILITIES MARKETER & ADMINISTRATOR CHANGE AGENT COORDINATOR WITH OTHER STATE AGENCIES Ensure that port services and facilities are provided, and may enter into agreements or licence other parties to provide these. Ensure that adequate, affordable, equitable and efficient port services and facilities are provided for port users. Ensure non-discriminatory, fair, transparent access to port services and facilities; advancement of previously disadvantaged people; promotion of representivity and participation in terminal operations; enhanced transparency in port management. Advise on all matters relating to the port sector, and liaise with all stakeholders.
7 PORT OF EAST LONDON BUSINESS OVERVIEW Terminals The National Ports Authority is a landlord Port Authority that provides port infrastructure and maritime-related services at the Port of East London. Key business parameters : Multi Purpose Terminal (Container & Breakbulk) Car Terminal (RoRo) Tanker Terminal (Liquid Bulk) Grain Terminal (Dry Bulk) 1.3 million square metres land area 4 Terminals 7 Terminal Operators 11 berths Ship Repair Facilities 3 maritime craft (2 tugs, 1 workboats) 179 employees Port Layout and Berth Data Key Commodities Key Port Commodities: Inbound Automotive Components (Containers) Vehicles (Ride on Ride off) (RoRo) Fuel (Liquid Bulk) Grains Wheat (Dry Bulk) Cement (Breakbulk) Outbound Vehicles (RoRo and Containers) Automotive Components (Containers) Processed Foodstuff (Containers) Livestock (Breakbulk)
8 KEY CHALLENGES AND INTERVENTIONS Challenges Infrastructure incompatible to commercial enterprise opportunities Dominant terminal operator Transnet Port Terminals (TPT) Strategic pockets of land occupied by one terminal operator misalignment between capacity and utilisation (loss of opportunity and revenue for port) Reliance on one customer (Mercedes Benz SA) - vulnerable and susceptible to market conditions and global trends in the automotive sector. Cyclical revenue based vehicle production cycles. Tariffs and the effect of tariff reform on port profitability. Age Profile of Employees Critical/core competencies Oversight Enforcement regime required to mitigate risk to TNPA of inconsistent applications Interventions Deepening and widening of entrance channel included in 10 year Capital Expenditure (CAPEX) plan All future terminals to follow Section 56 process (e.g. Heavy Furnace Oils (HFO) Tank) New entrants Attracting other Original Equipment Manufacturers (OEM s) and diversification of cargo streams. Optimisation of port land and infrastructure Implementation of internships Young professionals / Succession Plans. Implementation of operations strategy - Port System Performance Management (Terminal Operator Performance Standards - TOPS, Marine Operator Performance Standards - MOPS, etc) - Operations Centres - Development of consolidated terminal profiles
9 PORT VOLUME PERFORMANCE Dry Bulk 5.1% Liquid Bulk 33.0% BreakBulk 4.5% Containers 31.6% Automotive 25.8% Commodity Actual Conversion Factor Converted Tonnage Containers Dry Bulk Liquid Bulk BreakBulk Automotive
10 10 YEAR CAPITAL INVESTMENT & OPPORTUNITIES Existing Layout Medium to Long Term Layout Tourism & Leisure Development Phase 1 & 2 Replacement of Buffalo Bridge Signal Hill Development Small Craft Harbour Expanded Car Terminal Expanded breakwater & turning basin Vacant Land New Terminal Operator HFO S56 Operations Phakisa Shipbuilding Vacant Land Potential New Terminal / / / / / / / / / /25 Time Frames Strategic Projects Deepening and widening of Port Entrance Channel Replacement of Buffalo Bridge Foreshore Protection Supplier Development (SD) 40.9% Sheetpile Wharf Rehabilitation Security Protection Upgrade Refurbishment of graving dock R 2.8 Bn
11 DEEPENING AND WIDENING OF ENTRANCE CHANNEL Main Purpose DEFINE PROJECT OPTIONS SELECT MOST VIABLE OPTION We are here DEVELOP PROJECT DEFINITION IMPLEMENT PROJECT CLOSE PROJECT Year Completion Jun 2015 Jun 2015 Jun 2017 Sept 2021 Nov 2021 Phase Concept (FEL-1) Pre-feasibility (FEL-2) Feasibility (FEL-3) Execution (FEL-4) Finalise (Close-out) Activity Identify business need. Generate Various options to address the need. Execute Low level designs on the various options Gate 1 Review and Approval Preliminary designs and high level Geotechnical studies on various options Selection of an ideal option based on the studies. Cost of all options. Gate 2 Review and Approval Detail design on the chosen option. Environmental Impact Assessment Detailed Geotechnical studies Detailed Cost Estimate Tender Documentation Gate 3 Review and Approval Procurement Process Construction Hand over Gate 4 Review and Acceptance Performance confirmation Archive documentation Acceptance Commercial & financial closure Post project review Close-out report Project closed
12 OVERVIEW OF SHIP REPAIR OPERATIONS PHAKISA Operator: Transnet National Ports Authority Repairers: (Private Repairers) East London Shipyard Mac Engineering Land Marine Projects Intsimbi Group GL Enterprise Trust Amnion Projects Dock Length: 200m & Max beam: 24.8m Equipment: - 4 x Cranes (2 x 15 ton, 1 x 5 ton and 1 x 4 ton) Project In support of Blue Economy, NDP: Industrialisation Job Creation Skills development Create a new funding and revenue model, helping to reduce cost for infrastructure. Refurbish and optimise operations of existing infrastructure. Key Deliverables Refurbishment of Graving Dock over next 3 years:- Refurbishment of dry-dock cranes Replacement of crane rails Refurbishment of dry-dock gate Replacement of switchgear Refurbishment of pumps Refurbishment of Slipway area LENGTH: 200m WIDTH: 15.24m SLIPWAY TOTAL AREA: 2.4h MHA Area: 1 819m 2 DRYDOCK Shop 17 Area: `2 690m 2 Height: 12.5m Slip Way Capacity 800 tons Sheet Pile Wharf Length: 106m Repair Quay Length: 106m Depth:- 9.5m
13 OPERATION PHAKISA KEY 2015/16 CAPITAL PROJECTS Refurbishment of Graving Dock - Upgrade Fire Protestation Boost Pump, Air Compressor, DC Capstans, Main Shut-off Valves. The project is currently in FEL 3 The gate review was held on the 28 and a few changes were requested. All changes will be submitted to the gate review team on 14 August The next gate review is re-scheduled for 25 August Targeted investment forum is in September 2015 Targeted Capex is in October2015 Switchgear Replacement Overall Progress to date is 40%. Stage 3 of 6 : Design Development. Final design and Technical Specification have been completed RME going through the procurement process to appoint a supplier. Boat Building Initiative Engagement with various parties private and EC Provincial Government Appointment of Transnet transactional advisors DEVELOPMENT OF TECHNICAL COLLEGE Progress The port visited the school of engineering in East London (TE) Purpose of visit was to understand the process required to establish an accredited training centre Discussions with Transnet Engineering Curriculum Development Manager, List of critical skills identified The port propose to focus on a single skill set as a start Proposed site for the college identified The Registration process has been outlined. Way Forward Establishment of a working group consisting of Transnet Engineering & School of Ports Identification of existing accreditation documents Creation and filling of structure Approval of funding to renovate existing building. PORT OF EAST LONDON SHIP REPAIR STRATEGY A Strategy Workshop was held on 29 & 30 July The purpose of the workshop was to assess opportunities of how to position the ship repair business to support operations Phakisa in EL, The following were the key focus areas: The proposal to repair all TNPA fleet in EL, Opportunities for industrialisation, Skills development (college concept). A strategy framework document was developed with a number of topics to be investigated. A project schedule will be developed assigning tasks to various role players. PARTNERSHIPS 13
14 PROPOSED DEVELOPMENT - LATIMER S LANDING Phase 1 Port of Entry Police boat Shed & Workshop DPW Relocate Tourism & Leisure Craft Market Option 2 New Access Control Proposed Public Parking Area Jazz Lounge Vacant 5 Year Lease Existing Restaurant Proposed Tourism Office Plus 4 x SMME s Craft Market Option 1 Jetty INVESTMENTS: R2.1m Basic maintenance of buildings Painting, water reticulation, etc. (2013/14) R1.0m Additional maintenance (2014/15) Technical studies and architectural design Jetty Upgrade over 2 years Commencing 2015/16 Security Upgrade Access control, CCTV and additional lighting
15 NEW ENTRANTS SECTION 56 NEW MARKET ENTRANTS - SECTION 56 Red = existing terminal boundary Pink = proposed terminal boundary Yellow depicts rail line Blue Line pipeline Tanker berth Existing HFO Tank Legal / Governance Framework 1. PROVISION OF PORT SERVICES AND PORT FACILITIES AND USE OF LAND, Section 56, National Ports Act, Act 12 of Terminal Information Year Tank Commissioned 1977 Total Capacity 8,149,814 litres 2. Guidelines for Agreements, Licences and Permits as approved by Transnet Board Working Capacity Unpumpable Capacity 7,639,945 litres 509,869 litres Existing terminal footprint 8,000 m 2 Proposed terminal footprint 21,000m 2
16 PRIMARY ENGAGEMENTS PLATFORMS: Transnet EC Provincial Government Strategic Forum Joint Planning Sessions IDP / LTDP (Long Term Development Plan)/ ELIDZ Port Consultative Committee Customer/Stakeholder/B2B (Business to Business) Sharing of developments & planning Project Specific Engagements Investor / Industry Specific Engagements BUFFALO CITY METROPOLITAN MUNICIPALITY Ad hoc and Issue Specific Engagements Business Chambers BKCOB NAFCOC
17 BBBEE SPEND AND SUPPLIER DEVELOPMENT Procurement of goods and services are strictly procured in line with Transnet Detailed Procurement Policy as approved by Transnet Board YEAR % BBBEE 2014/15 109% 2013/14 90% 2012/13 85% 2011/12 66% 2010/11 41% Suppliers / Service Providers: Not interested in operational requests (day to day purchases) Only interested in long term tenders/high value acquisitions Failing to meeting delivery requirements due to logistical constraints Failing to delivery due to financial constraints resulting in cancellations of orders and causing delays in operations Not adhering to RFQ (Request for Quotations) requirement resulting in disqualification Over commitment resulting in non delivery and poor quality goods and services Various engagement sessions e.g: Local Business Chambers
18 OUR PEOPLE Growing & Developing our Workforce Address skills shortage via Apprenticeship & Section 28 (Recognition of Prior Learning) programmes Engineering in Training & Technician in Training Programme Appointment of Young Professionals in various professions Strategic Partnering with Office of the Premier Succession planning will address the Aging Workforce Profile, especially technical skills. Talent Management Pool - skilled and experienced workers in Mentorship Programme Capacity Building Initiatives will serve as the Vehicle to address employment equity targets (1:3 appointments/promotions must be female)
19 OUR PEOPLE OUR COMMUNITY CSI Objectives Awareness of maritime careers and port as a neighbour TNPA as a good corporate citizen Role of port in the economy of Eastern Cape & SA Awareness of port facilities & activities Opportunity for partnerships with key stakeholders CSI Port Spend R Projects Education (Maths and Science) ITEC (Maths & Science Intervention) 10 Bursaries 2014 and ongoing Take a Girl Child to Work TNPA Maritime Career EXPO Students over 5 days Youth Chamber of Shipping in Africa- Careers Exhibition Mdantsane Indoor Centre Students Employee Volunteerism Sport Development: Lwazi Jquira Legends Sports Race Partner VALUE TO TRANSNET AND TNPA Business (value to prospective clients) Community builder Stakeholder / Customer collaboration ROI -Strong Brand Positioning Social (value to community) Exposure to a working Harbour Fund-raising opportunity for charities Safe, top class entertainment family orientated FUNDING MODEL Primary Funders to be targeted: TNPA EC Parks & Tourism BCMM MBSA ELIDZ Development of sustainable funding model
20 SECOND CREEK CRECHE WOMEN S MONTH INITIATIVE
21 ITEC MATHS & SCIENCE CSI INTERVENTION
22 JOHN BISSEKER HIGH SCHOOL MANDELA DAY
23 PORT FESTIVAL
24 PORT FESTIVAL
25
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