Crunch time for fuel supplies

An estimated funding shortfall of R1.1bn for Transnet's New Multi Products Pipeline (NMPP) from Durban to Gauteng could put great pressure on inland fuel supplies in coming months.

On Friday Dr Rod Crompton, National Energy Regulator (Nersa) member for pipelines, told the energy portfolio committee that no money had yet been granted for Transnet’s main fuel pipeline and that another R108m was needed to complete the three branch pipelines.

The cost of this project has shot up from R11bn in 2007 to R22bn in 2011.

Postponement of the coming into operation of the pipeline system is exerting great pressure on the country, which is currently entering the riskiest period of fuel supply, he said.

This could lead to fuel shortages by the end of the year as a consequence of distribution problems, especially over the Christmas period when many South Africans are on the roads.

The pipelines from Waltloo to Kendal, Jameson Park to Alrode, and Alrode to Langlaagte, have already been completed. The pipeline between Durban and Jameson Park will be partially completed only in January 2012.

Furthermore, there are still delays in constructing the coastal terminal at the Durban port.

Crompton said that the worst scenario would that the pipeline was completed but there was no money to put it into operation.

This year the difference between demand (about 14 200m litres) and the existing pipeline’s capacity is some 1 800m litres.

In the coming months Transnet will also muster road and rail transport to assist with fuel supply. This means that the number of trucks transporting fuel from the coast to Gauteng would have to increase from 68 (in 2010) to 117. This represents a 12-minute gap between trucks, compared to 21 minutes in 2010.

Source: fin24, Monday 27 June 2011