TRANSNET Freight Rail is exploring the possibility of a new railway through Swaziland to Richards Bay to move general freight off the coal line.

The coal line has a capacity of 68-million tons a year and the rail operator was investigating increasing capacity to as much as 97-million tons a year, Transnet Freight Rail CEO Siyabonga Gama said at a transport investment conference in Cape Town yesterday.

Coal mining companies have been pushing for greater volume on the line to the coal terminal at Richards Bay to cash in on high prices for export-grade thermal and metallurgical coal, for steel making. Prices have surged on strong demand from countries such as China and India. Transnet Freight Rail was considering moving other freight off the coal line and constructing a new line that would carry these goods to the coast.

A memorandum of understanding had been signed with Swaziland to investigate the economic feasibility of such a development, Mr Gama said.

"We want to see if we can explore a link through Swaziland to Richards Bay so we can use that channel to take out noncoal cargo, which would vastly improve capacity," he said.

As much as 15-million tons of general freight transported on the coal line annually could be moved to the new line, Mr Gama said. An update on a study being conducted with Swaziland would be ready by October.

The new general freight rail line is likely to run from Ermelo in Mpumalanga into Swaziland towards Mbabane and then to the industrial area of Matata - Swaziland's second city - before ending in Richards Bay.

Stephenson Ngubane, the director of operations and marketing at Swaziland Railway, said the new line was still in the concept phase and was being discussed with Transnet.

He said it would be an entirely new line and could link up with a new iron-ore mine being planned on the border between Swaziland and SA. The line would also be used to transport other minerals from Swaziland to Richards Bay.

Another study, a railway line between the coal-rich Waterberg region and Ogies, in Mpumalanga, was also being explored, Mr Gama said.

Transnet Freight Rail was working with the National Planning Commission, the Chamber of Mines and Eskom on a feasibility study for the line that would be completed by the end of next year. The new coal line would be 450km long and could cost about R4m/km, Mr Gama said. "It will cost between R17bn and R19bn for that line, and then you would need the necessary wagons and rolling stock of between R30bn to R40bn to support coal," Mr Gama said.

If approved, the new line would "help to catapult SA beyond its current position as the sixth-largest exporter of coal to perhaps the second- or third-largest globally", he said.

Transnet Freight Rail planned to spend R37bn on the existing coal line over the next 10 years "to improve and sustain operations", Mr Gama said. "An additional R20bn to R25bn . will need to be spent to make sure the volumes go beyond the theoretical capacity."

Transnet is also looking to expand its port facilities. The National Port Authority is to appoint advisers on building a new terminal and port in Durban, the authority's CEO, Tau Morwe, said yesterday.

smithn@bdfm.co.za