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Hoorah: First Steps to decommissioning Port of Port Elizabeth Tank Farm

Oiltanking Grindrod Calulo Holdings

New liquid bulk handling facility at the Port of Ngqura

Transnet National Ports Authority (TNPA) appointed Oiltanking Grindrod Calulo Holdings to plan, fund, construct, maintain and operate a new liquid bulk handling facility at the Port of Ngqura. This Build, Operate and Transfer (BOOT) agreement was concluded in December 2016, after an open tender process. To mark the occasion, a ceremonial signing will take place in Port Elizabeth this evening.

Richard Vallihu, Chief Executive of TNPA, said: “This milestone signals progress in our plans to free up port land for future expansion at the Port of Port Elizabeth, and will in the near future lead to our decommissioning of the Port Elizabeth tank farm and rehabilitation of the site once the Ngqura facility becomes operational.”

The concept engineering design as well as the topographical and geotechnical survey has been completed and construction is due to commence in the 4th quarter of 2017, with commissioning planned for the 3rd quarter of 2019.

Phase 1 of the liquid bulk facility will provide approximately 150,000 cbm of storage capacity for refined petroleum products and will replace the tanks currently in use in the Port of Port Elizabeth, which will be decommissioned and the land redeveloped. This is in line with Port Elizabeth’s plans to clean up the terminal facilities and develop the commercial and tourism sectors.

Future phases will provide for an additional 550,000 cbm of storage capacity and handling. The new modern facility will service the Oil Majors, new entrants into the South African oil industry as well as international traders – all supporting the local shipping industry.

Oiltanking Grindrod Calulo, a majority South African owned level 1 BBBEE company, is an independent bulk liquid storage provider in South Africa. The Ngqura facility is a unique opportunity for the joint venture partners as well as for the region.

For Oiltanking, it will be its first holding in a South African fuel terminal, whereas for Calulo, being involved in all aspects of the oil supply chain’s, it will be its first clean products terminal. For Grindrod, the Ngqura liquid storage facility provides diversification into fuel storage and handling and aligns with its coastal tanker shipping through Unicorn Tankers.

The liquid bulk facility will create socio-economic benefits and will boost the Eastern Cape (Nelson Mandela Bay Municipality) economy. Besides generating local jobs during the construction phase of the project, the facility will provide permanent positions in the long term. It will promote skills development in the contruction industry as well as empower the local BBBEE businesses. The region will benefit from additional tax income and the local businesses from increased revenues.

Editor: The Chairperson of OTGC, Mr. Mkhuseli Faku – a cousin to former Mayor, Nceba Faku – is also a business partner to Kobus Smit who is a director of the firm Buhlebendalo, which in 2004 signed a lease agreement with the Nelson Mandela Bay municipality during Nceba Faku’s tenure as mayor to develop the Van Stadens Beach Resort.

Smit, who moved to the region from the Northern Cape in the mid-1990s, made his fortune from mining ventures. He also bought Knysna’s internationally renowned 150ha Featherbed Nature Reserve from celebrity mathematician William Smith in 2013, allegedly for a whopping R212-million. His co-director in Buhlebendalo Properties is Bay attorney Sivuyile Ntlabezo, a director at law firm Boqwana Loon and Connellan.

“Mkhuseli [Faku] has a house there because he is financially involved in the project,” said Ntlabezo in 2014. “At this stage there are issues between us and the municipality relating to our site development plan. Our EIA will follow once we have clarity on the site development plan (from the municipality). We are still pursuing the original concept (design).”

Then Executive Mayor Nceba Faku gave the go-ahead for Buhlebendalo Properties to be granted the 40-year-lease – renewable for a further 40 years thereafter – to develop the Van Stadens Resort.