According to Mr Malusi Gigaba Public Enterprises Minister who said recently that the line would create additional capacity of 15-million tons a year and unlock significant coal exporting potential construction on a new railway line from the coal-rich regions of Mpumalanga to Swaziland was on track to begin in the middle of next year.

Coal miners have been complaining for years about the lack of capacity of the existing lines. Mr Gigaba said the investment would alleviate the problem and encourage junior coal miners which played an important role in job creation.

The 146 kilometers rail connection from Lothair in Mpumalanga to Sidvokodvo in Swaziland would create the additional capacity for coal exports by moving general freight volumes from the existing coal export line which moves about 72-million tons a year to the new line.

Mr Gigaba signed a memorandum of understanding in Pretoria yesterday with Swaziland’s Public Works and Transport Minister Mr Ntuthuko Dlamini. He said that Mr Gigaba said the route for the new line would "create the conditions for the industrialisation of the two countries" and link the regional economies of Southern Africa.

Mr Gigaba said the project would lower the cost of exports and transport in the region and would connect SA with the north-south corridor. The new line would maintain a sole focus on coal transportation to deal with the logjam that was being experienced in Ermelo and to avoid missing out on the great opportunity provided by the coal-rich Waterberg region, he said.

Mr Gigaba said in an interview after the event that SA’s required funding was already set aside in the government’s ZAR 300 billion capital expenditure programme while Swaziland had assured the funding on their part was available.

He said that Swaziland Railway was cash flush and there was strong interest from banks and financial institutions to fund the project.

The two countries were also comfortable that the required ZAR 17 billion funding was secured. SA would pay ZAR 12 billion towards the project as the bulk of the rail capital needed for the project was in SA while Swaziland would pay ZAR 5 billion. The costs, however excluded rolling stock, contingencies, escalations, engineering, procurement and construction management costs.

Source - Businessday

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