Cape Town - 131016 - Today Lucky Montana, GCEO of PRASA, addressed a breakfast press conferrence on one of the biggest capital expansion projects in South African history, a R123 billion rail recapitalization. Shadow Minister of Transport for the DA Ian Ollis was also present for comment. Pictured: Lucky Monatana. PICTURE: WILLEM LAW.
Cape Town - 131016 - Today Lucky Montana, GCEO of PRASA, addressed a breakfast press conferrence on one of the biggest capital expansion projects in South African history, a R123 billion rail recapitalization. Shadow Minister of Transport for the DA Ian Ollis was also present for comment. Pictured: Lucky Monatana. PICTURE: WILLEM LAW.

Spanish firm wins tender for Prasa engines

By Donwald Pressly Time of article published Oct 17, 2013

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Johannesburg - The announcement that Vossloh of Spain has been awarded a contract worth e250 million (R3.5 billion) to supply new locomotives for leasing to the Passenger Rail Agency of SA (Prasa) has opened up a hornet’s nest.

Yesterday Lucky Montana, the chief executive of Prasa, told the Cape Town Press Club that the Spanish locomotives would be more cost efficient in the longer term than local locomotives.

Vossloh will provide 70 locomotives to Shosholoza Meyl, the long-distance passenger service, including at least 50 which run on both electricity and diesel and the remainder solely on diesel.

Montana was adamant that $4.2m (R42m) for each locomotive “is good value for money”. The assembly of the “hybrid diesel” locomotives would happen in South Africa, he said.

Montana was insistent that these would be easier to maintain and would also cut costs of switch-over delays currently experienced on the longer routes, such as on the Johannesburg-Cape Town line.

The Spanish contract is just one element of a major refurbishment of South Africa’s state rail sector. The Gibela Rail Transport Consortium led by Alstom-Actom is the preferred bidder to build 3 600 coaches for Metrorail, the commuter rail arm of Prasa, for a contract price of R51bn. Alstom is the French parent company, with Actom its South African subsidiary. Montana said a guarantee of R40bn had been provided.

A further R11bn guarantee was expected to be announced in the medium-term budget policy statement next week by Finance Minister Pravin Gordhan.

“It is only then that we will give notice to proceed to build the trains by the Gibela consortium,” Montana said.

The consortium was named as the preferred supplier of the “rolling stock fleet renewal programme” last December.

But DA transport spokesman Ian Ollis said he “smelt a rat” about the Spanish contract “in particular”.

In addition to this contract, the Spanish company would also be providing air-conditioners for Metrorail trains which Ollis described as “simply scandalous… because it is fully imported and they are double the price”.

Ollis said: “I know that there are at least six companies that can build them [air-conditioners]… two are specialist rail air-conditioning companies.

“They design air-conditioning systems especially for trains and manufacture them and install them here in South Africa.”

One of the companies, Booyco Engineering, had provided air-conditioning systems for Prasa trains in the past.

Ollis said his party would put questions to Gordhan to ascertain whether Prasa had been granted a waiver to import air-conditioning systems.

Montana, however, said the agency had indeed been provided a waiver allowing it to deviate from the requirements of the Preferential Procurement Policy Framework Act.

In terms of this act, at least 60 percent of all heating, ventilation and air-conditioning in rail rolling stock procurement needs to be produced locally.

He said local firms had in the past not provided satisfactory air-conditioners.

Prasa said it rejected a DA call for the auditor-general to investigate Prasa’s contract with black empowerment firm Swifambo Rail Leasing, which will rent the Spanish locomotives to the parastatal. - Business Report

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