R83bn West Coast projects could create jobs.

July 28, 2010 by: admin

BILLIONS of rands are set to be pumped into the West Coast’s Saldanha Bay over the next 20 years, radically changing it into an industrial powerhouse and creating thousands of jobs.

Five major projects are on the cards for the town. They include developing the port economy, increasing its bulk export capacity, building a renewable energy plant, exploiting its oil and gas potential, and a massive housing project. The investment, mostly foreign, will be to the tune of a whopping R83 billion over 20 years and creating close to 40 000 jobs.

Saldanha Bay has the deepest and largest natural harbour in the southern hemisphere, making it ideal for industrial development.

This week the Saldanha Steel debacle highlighted the pressing need for new ways to diversify the town’s economy.

The government had to step in to help resolve the dispute between ArcelorMittal SA and Kumba Iron Ore over an interim pricing agreement. Although it is an interim agreement, it heads off Mittal’s threat to close its Saldanha Steel plant, shed up to 4 000 jobs, and curtail exports and domestic production, leading to higher local steel prices and curbed economic growth.

Follow up:

In an interview, the town’s municipal manager James Fortuin said Mittal Steel was a major contributor to the town’s economy, but they were looking for ways to expand further.

Consultant Peter Stuivenberg said feasibility studies were being done and these would be followed by environmental impact assessments. “If all goes according to plan, construction of the various projects should start in the middle of next year, or towards the end of the year.

“The projects involve major foreign investors and major oil and ship building companies. A renewable energy plant independent of Eskom will supply affordable electricity that is essential to industrial growth.

“We are working with the Port of Rotterdam for assistance in developing Saldanha’s port.”

The various projects include:
• A R45 billion industrial development zone with offices and an increased cargo capacity. During the construction phase there will be 5 000 jobs, and when it is up and running, 25 000 direct jobs will be created.

• A R11bl renewable energy plant that will produce 200MW of solar and 100MW of wind energy, two 360MW coal gas plants, creating 2 500 jobs during the construction period and 1 250 direct jobs.

• A R6.5bn lower to middle class housing project, with office parks, restaurants and shops. The solar city will include 6 000 “green” houses, run on renewable energy. It will create 7 500 jobs during the construction phase and 5 000 direct jobs.

• R500 million will be invested I creating two floating drydocks for maintaining and repairing vessels used in oil and gas exploration, in which 400 direct jobs will be created.

• A major oil company will invest R20bn in oil and gas exploration, including a facility for the repair and maintenance of oil rigs, creating 3 500 direct jobs and 2 000 jobs in the construction phase.

Provincial Minister of Finance, Economic Development and Tourism, Alan Winde, said: “Saldanha Steel plays a vital role in the economy of Saldanha Bay, both as an employer and driver of industry.

“We are pleased that Kumba and ArcelorMittal have ended their commercial dispute – the 4 000 employees at Saldanha can now move forward in their jobs with a sense of security.

“As the government, we will engage with Saldanha Steel and other key players to discuss the formation of an industrial development zone in the area. This long-term vision will drive significant revenue and employment creation in Saldanha Bay.”

He said the Saldanha Bay municipality had a gross geographical product of R4.68bn in 2008. The total GGP for the West Coast in 2008 was R14.068bn.

“Our primary concern is to grow the economy of the Western Cape, so that we create jobs. With its deep-water port, iron ore terminal and mega-smelters, Saldanha Bay has long been viewed as an area of major international significance in term of industrial potential. Several investors have expressed an interest in moving into the area.”

“As global fish stocks deplete, it is important that we encourage alternative forms of employment.”

(article from Weekend Argus – Saturday 24 July 2010)

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