Transnet CEO Portia Derby has confirmed that the State freight logistics group is preparing to procure a significant number of locomotives again, after having halted purchases under the “irregular and unlawful” R50-billion ’10-64’ programme.

Derby tells Engineering News that, while a settlement agreement has been reached with General Electric, processes are still under way to secure settlements with China North Rail, China South Rail and Bombardier Transportation.

Transnet has taken delivery of 595 locomotives arising from the 2015 contract, representing 56% of the original order for 1 064 diesel and electric locomotives.

The procurement was halted in 2019 after irregularities and alleged corruption were unearthed, much of which was confirmed through evidence provided to the Judicial Commission of Inquiry into State Capture.

Transnet announced that it would be seeking “just end equitable settlements” with the four original equipment manufacturers.

General Electric was awarded a contract to supply 233 of the 465 diesel locomotives ordered, while China North Rail was contracted to supply the 232 balance. China South Rail was awarded a contract for 359 of the 599 electric locomotives ordered, with Bombardier Transportation to supply 240.

Derby says she is optimistic that settlements will be reached with the remaining three original equipment manufacturers and of proceeding with a new procurement process to close the capacity gap left by the fact that it could no longer proceed with the 10-64 programme.

The new tender is, thus, likely to be for at least 400 new locomotives and will be issued once all the necessary approvals have been secured.

Derby says every effort will be made to avoid the corruption, as well as the mistakes associated with the 10-64 procurement, including its lack of standardisation across the fleet.

Locomotive procurement, together with slot sales to third-party railway operators, is viewed as part of a broader strategy aimed at increasing the volume of freight that is moved on rail in South Africa.

The system has the theoretical nameplate to transport 250-million tons yearly, but volumes have never breached 226-million tons and have slumped in recent years as the service has been disrupted by both Covid and high levels of cable theft.

Volumes fell to 184-million tons in the 2020/21 financial year and while the figures are yet to be audited for 2021/22, it is likely that another decline will be reported.

The fall is partly attributed to the age and performance of the locomotive fleet, of which 77% was available for service as of March.

Of the fleet available for service currently, 57% is from the legacy fleet, while the remainder is from the newer fleet, including locomotives procured as part of the 10-64 programme and pre-10-64 procurement.

Derby says no decision has been taken regarding technology, stressing that electric locomotives should not be precluded simply because of the ongoing scourge of cable theft.

“There is no running away from it, we have to deal with the theft of cables,” Derby avers.

She also highlights that there are technical reasons why diesel locomotives cannot be used on certain parts of the network, including in certain tunnels.

While both technical and human security solutions are being introduced across the network, Derby believes at least part of the solution lies in ensuring that the rail is densified, including through the sale of slots.

“If we have trains running on a regular basis, the opportunity for theft will decrease.

“Once the long intervals between one train and the next is reduced, the risk factor for the thieves of either being caught or being killed rises dramatically,” she says, adding that the sale of slots will also introduce new entities with a direct interest in ensuring that cable theft is curbed.

Transnet has launched a bidding process for 16 rail slots, which will be sold ‘voetstoots’ to third-party operators for a period of two years on a take-or-pay basis. A...