A recent Request for Information (RFI) issued by South Africa’s Transnet and Botswana Railways to assess the potential market for the proposed Mmamabula–Lephalale Railway received significant interest. Potential customers committed to transporting 15 million tonnes of cargo once the project is operational, with volumes expected to increase to 37 million tonnes within three years, maintaining that level in eight years, and reaching 44 million tonnes within a decade.
Speaking at the high-level Mmamabula–Lephalale Rail Link Investor Summit held in Gaborone, Botswana, Wilson Mogoba, General Manager for Business Development at Transnet SOC Limited, highlighted the strong market demand for the project. The proposed railway line aims to connect the Mmamabula coalfields in Botswana with Lephalale in South Africa, facilitating coal transportation for power generation and potential exports via South African ports.
Mogoba noted that the demand reflected in the RFI exceeded initial estimates by Transnet and Botswana Railways. Their projections anticipated an initial demand of 6.6 million tonnes when the project launches, with a gradual increase to 16.5 million tonnes by 2050.
The RFI also indicated strong investor interest, with commitments not only in haulage volumes but also in financing the project through debt or equity investments. Additionally, some investors expressed a willingness to invest in rolling stock. However, Mogoba emphasised that potential investors require clear commitments from both the Botswana and South African governments through robust intergovernmental agreements. Investors also seek strong backing from Transnet and Botswana Railways to ensure the project's viability.
Furthermore, investors have requested tax concessions and holidays, as well as guaranteed capacity for transported goods at Richards Bay, South Africa. They also want both rail operators to upgrade existing railway lines that will connect to the Mmamabula–Lephalale Rail Link. Another critical requirement is the establishment of a more efficient, seamless border operation to replace the current time-consuming processes. Additionally, both governments must secure and allocate land for the project.
Mogoba detailed the operational aspects of the railway, stating that it will operate with a minimum of 100 wagons and a maximum of 200 wagons. The system is designed for continuous operation without stopping at the border, with an estimated turnaround time of 92 hours between Mmamabula and Richards Bay.
The total cost of phase one of the project is estimated at US$627 million. Of this, US$96 million will be allocated to South Africa, specifically for the greenfield section from just beyond the Limpopo River to Lephalale. In Botswana, US$328 million will be invested in constructing a 70-kilometre greenfield railway line. Additionally, the rolling stock for phase one is expected to cost approximately US$200 million.
Mogoba further explained that an estimated US$1.1 billion will be required to build a 120-kilometre railway segment, leveraging an existing 900-kilometre railway network in South Africa.
Speaking on the broader economic impact, Botswana Railways’ Acting General Manager emphasised that the railway line will contribute to Botswana’s economic growth, attract foreign direct investment (FDI), and enhance inter-country connectivity. The project is also expected to position Botswana as a strategic transport hub in the region.
Charles Siwawa, CEO of the Botswana Chamber of Mines, underscored the importance of railway transport for bulk commodities such as coal, copper, and iron ore, which are key products of Botswana’s mining sector. He noted that the Mmamabula–Lephalale Railway could also facilitate the transportation of other minerals, including soda ash and manganese, as well as fuel products.
Written for Railways Africa by Chamwe Kaira
