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KwaZulu-Natal Business 2022-23

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The 2022/23 edition of KwaZulu-Natal Business is the 14th issue of this highly successful publication that, since its launch in 2008, has established itself as the premier business and investment guide for the KwaZulu-Natal Province. In addition to the regular articles providing insight into each of the key economic sectors of the province, there is a special feature on national government’s campaign to encourage private investment in ports. The vital role of the ports of Durban and Richards Bay in the South African economy cannot be understated and putting them in a better position to deal with commodities and cargoes of every sort is clearly in the national interest. A special purpose vehicle is to be created within Transnet to make dealing with private companies less complicated. The increasing importance of the Oceans Economy to the future of the provincial and national economy is relevant to any examination of the economy of KwaZulu-Natal. This applies as much to trade and ship-repair as it does to the exciting gas discoveries which have been made off the coast of Mozambique and South Africa.

OVERVIEW Engineering

OVERVIEW Engineering UCL’s expansion included three large projects. SECTOR INSIGHT The School of Engineering at UKZN offers nine specialisations. UCL hired Bosch Projects to expand its factory. Credit: Bosch Holdings Bosch Projects recently undertook three projects at the Dalton factory of sugar producer and wattle-bark miller UCL Company. The projects were completed over a nine-month period which included parts of the Covid-19 lockdown. Cane input was increased by 25% through a widening of the chainless diffuser, a procedure that the company claimed as a world-first. UCL Company manufactures wattle tannin extracts, sugar and pine lumber. All of the province’s biggest industries require sophisticated engineering skills: aluminium smelters in Richards Bay and steel works in Newcastle, Richards Bay and Cato Ridge. There are also chemicals and plastics production plants, and large automotive works. Marine repair and engineering are important, with established companies such as EBH South Africa offering comprehensive services at the ports of Durban and Richards Bay. Dormac, which is headquartered in the Bayhead area of the Port of Durban, is best known for its marine engineering but it offers specialised services to the sugar industry and provides machinery for industrial giants like Toyota and Defy. One of the largest independent wire manufacturers in the country, Hendok Group, is steadily increasing its exports to other African countries. With more than 1 000 employees at the factory in the Phoenix Industrial Park in Durban, the company makes a wide variety of wires and is the country’s biggest producer of nails. ArcelorMittalSA is Africa’s biggest steelmaker and it has a plant at Newcastle, but tough times in the steel business have meant that ONLINE RESOURCES Consulting Engineers South Africa: www.cesa.co.za Southern African Institute for Industrial Engineering: www.saiie.co.za WASH R&D Centre: www.washcentre.ukzn.ac.za the company has shut down some of its facilities. The first to be shuttered was Saldanha in the Western Cape and an analysis of the profitability of other centres is underway. A big project that has created a lot of work for engineers is the multi-year Western Aqueduct project to bring fresh water to greater Durban. The Transnet Engineering (TE) plant in the Port of Durban houses six business units and has 3 555 employees. The Port Equipment Maintenance unit and units specialising in wheels and locomotive overhaul are other entities. The Pollution Research Group (PRG) at the University of KwaZulu-Natal (UKZN) has a new name and an extended brief. It has been re-established as the Water, Sanitation and Hygiene Research and Development Centre (WASH R&D Centre). The unit continues to fall under Chemical Engineering, where 34 staff contribute to lecture modules in a variety of fields but which now go far beyond the original brief of water in industry. In addition to Chemical Engineering, the School of Engineering offers a range of degree options in nine areas of specialisation including Bioresources, Electronic and Computer Engineering and Land Surveying. ■ KWAZULU-NATAL BUSINESS 2022/23 32

Oil and gas South Africa’s largest crude oil refinery is likely to come on the market. OVERVIEW SECTOR INSIGHT Petroleum Agency SA has awarded gas exploration rights. Shell Downstream South Africa and bp Southern Africa announced in February 2022 a “spend freeze” and paused operations at the SAPREF oil refinery in Durban. The refinery, pictured, accounts for roughly 35% of the country’s refinery capacity and is likely to be offered for sale. The first announcement of the “pause” did not give reasons for the decision but it is likely that the violent riots of July and the decision by a court to block Shell’s offshore seismic surveys in December 2021 played a role. Durban’s other oil refinery, Enref, was hit by a fire in December 2020 and there are plans to convert it to a storage facility. South Africa is a net importer of fuel and the Port of Durban handles 80% of South Africa’s fuel imports. The regulator and promoter of oil and gas exploration in South Africa, Petroleum Agency South Africa, has awarded coalbed-methanegas exploration rights in KwaZulu-Natal to NT Energy Africa, which has a partnership with the Central Energy Fund. These awards are for onshore exploration. The Petroleum Agency SA is an agency of the National Department of Mineral Resources and Energy (DMRE) The Port of Richards Bay is investing in new infrastructure. The supply of liquid petroleum gas (LPG) is set to be made much easier and more reliable with the erection of the 22 600-ton Mounded LPG Facility at Richards Bay. Bidvest Tank Terminals has constructed the R1-billion storage facility for Petredec, which trades, transports and distributes LPG and other ONLINE RESOURCES National Energy Regulator of South Africa: www.nersa.org.za Petroleum Agency SA: www.petroleumagencysa.com South African National Energy Association: www.sanea.org.za South African Petroleum Industry Association: www.sapia.co.za commodities. South Africa’s annual consumption of LPG, currently at 400 000 tons, is expected to rise to 600 000 tons. If a private partner can be found, an LNG plant will produce 2 000MW at Richards Bay. This forms part of national government’s allocation of 3 126MW to natural gas in its medium-term energy policy to 2030. The National Department of Mineral Resources and Energy allocated one of the first two gasto-power plants to be constructed under the Independent Power Producer Procurement Programme to Richards Bay. This has the potential to turn the Richards Bay Industrial Development Zone (RBIDZ) into an energy hub. Eni, one of the world’s biggest energy companies, has an agreement with Sasol Petroleum International to explore for hydrocarbons off the coast of KwaZulu-Natal. Getting fuel to the province of Gauteng is the key mission of the new multi-purpose pipeline (NMPP). Refined products such as jet fuel, sulphur diesel and both kinds of octane petrol are carried. The infrastructure of Transnet Pipelines is said to reduce the number of fuel tankers on South African roads by about 60%. ■ 33 KWAZULU-NATAL BUSINESS 2022/23

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