9 months ago

Northern Cape Investment Prospectus 2021

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INVESTMENT OPPORTUNITIES DE AAR LOGISTICS HUB PROJECT LOCATION: District: Pixley Ka Seme District City/Town: De Aar NUMBER OF JOBS TO BE CREATED: Create 2,475 job opportunities (temporary and full-time jobs) INVESTMENT VALUE: Total value of the project: R600-million. Kleinzee Vioolsdrift Springbok Upington Kathu Kuruman Kimberley Hondeklip Bay PROJECT NAME AND BACKGROUND: De Aar Logistics Hub: The Project entails construction Sutherland of an inland intermodal system comprising: Container Terminal, Vehicle parking Terminal, Warehouse/Cold room Terminal. The province has focused its priorities (in alignment with the National Development Plan – Vision 2030) and identified priorities to enhance the quality of life of the community. There are inefficiencies in the transport sector which restrict economic growth and job creation because over 80% of freight in South Africa is moved via road. The result of this is poor road conditions which have an impact on product quality, product losses and substantial expenditure towards vehicle maintenance and related costs. The result is increased operational expenditure for miners and farmers. The Northern Cape is a major exporter of table grapes, fruit and meat and is responsible for much of the cattle, sheep and goat farming in the country. Long distances and poor access to markets and storage facilities are limiting profitability for farmers. Small-scale and emerging farmers are excluded from exporting due to the lack of critical mass and other dynamics such as access to markets and financial resources. The mining sector has expressed similar concerns. Approximately 60% of the commodities from large producers is already moved from Hotazel by rail through the province via De Aar or Bloemfontein to Port Elizabeth. Various other commodities are moved via rail through the town of De Aar, of which the most notable are cement from domestic market, coal and lime, and containers holding general cargo and automotive components. Train drivers and locomotives are changed in De Aar which supports the concept of De Aar becoming a consolidation point for freight to ensure migration from road to rail due to its location and connectivity. The De Aar Logistics Hub serves as the first step for the long-term solution sought by the Northern Cape Department of Transport, Safety and Liaison (NCDTSL) to optimise the freight strategy and logistic functions of the province. The Key Priorities which could be addressed through these projects are: Brandvlei • Expanding infrastructure • Economic development • Creating jobs and therefore contributing positively to the livelihoods of the people of the province • Transforming the spatial reality • Improving education and training • Addressing the social ills of the province. De Aar Colesberg 24

TARGETED SECTORS: Logistics. DESCRIPTION OF THE PROJECT: South African Heavy Haul Association Container logistics hub for freight comprising: • Container terminal – consolidation of freight • Agricultural warehouse • Storage facilities • Vehicle storage yard. Potential commodity mix: The Northern Cape has many commodities that can be traded and transported via the De Aar Logistics Hub which could serve as a catalyst for local and regional economic development (see table below). COMMODITY Iron Ore Manganese Auto Manufacturers Agriculture School Nutrition Upington Cargo Hub Namibian trade Transit Strategic Marterial Supply Hub VOLUMES 50 to 60mtpa predominantly for the export market 18mtpa for the local and export markets 15 000 units per annum 2mtpa (exports and local markets) 45 000 tons (provincial market) Tonnages to be confirmed and to serve the export market Tonnages to be confirmed Tonnages to be confirmed for provincial market only PROJECT FINANCED BY: Public-Private Partnership (PPP), Equity partners/investors. The proposed funding structure entails a cash equity injection of 15% and the balance being funded through senior and sub-ordinated loans. PROJECT STATUS: Initial Government Announcement, Project Investigation and start of Project Feasibility / Business Case completed. PARTNERSHIPS: • Provincial government (DTSL) • District and local municipalities • Consultants. RESPONSIBLE INSTITUTION: Northern Cape Department of Transport, Safety and Liaison Contact person: Mr MP Dichaba, Head of Department Mobile: 082 675 1933 I Email: / TM/Nelutha Consulting Contact: Thamie Mqina and Mojalefa Peter Maniza, Designation: Consultants (transactional advisors) Tel: 053 833 1010 | Mobile: 084 730 8450 / 082 889 3685 Email: / | / Mr Hendrik Louw, Acting CEO Northern Cape Economic Development, Trade and Investment Promotion Agency (NCEDA) Tel: +27 53 802 1638 | Mobile: +27 81 323 2533 | Email: 25

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