36th ANNUAL CONFERENCE

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INSTITUTE OF QUARRYING ASPASA
Gautrain Rapid Rail Link By Jack van der Merwe
CEO PPP Unit, Gauteng Department of Finance
Economic Affairs
T
36th ANNUAL CONFERENCE EXHIBITION Birchwood
Conference Centre, Gauteng 3-5 MARCH 2005
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Gautrain Rapid Rail LinkInstitute for
Quarrying3 5 March 2005

• Jack van der Merwe (Pr. Eng)
• Project Leader Gautrain
• Chief Executive Public Private Partnerships
• Gauteng Provincial Government

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Background
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The Powerhouse of Africa

• Gauteng is
• Less than 2 of Countrys surface area
• Home to 70 of the SAs workforce
• Accounts for some 40 of GDP of South Africa
• Generates 9 of GDP of Africa
• Most developed infrastructure in Africa
• Most technologically advanced Province
• The population is expected to exceed 9 million by
  the endof 2004

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Gauteng EconomicDevelopment Strategy

• Existing economic strengths
• Mining
• Heavy Industry
• Financial Banking sector
• Proposed strategy
• Smart industries - Gauteng the smart Province
• Move toward high value-added manufacturing
• Enhancing the business services (Finance
  Banking) sector and business tourism

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Provincial Blue IQ Initiatives
"Blue IQ is a multi-billion Rand initiative of
the Gauteng Provincial Government to invest in
economic infrastructure development in identified
mega projects in tourism, smart industries and
high value-added manufacturing to create a truly
smart province."
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Rationale
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(No Transcript)
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Traffic Flow on N1
N1 at New Road 0n Tue.03/10/2000
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Share of Gauteng inNational Vehicle Fleet
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Gauteng Vehicles/km
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Technical info
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Gautrain Key Objectives (1)

• Economic growth, development and job creation
• Alleviate severe traffic congestion (traffic
  volumes in corridor growing at 7 p.a. for more
  than a decade)
• Must meet other goals of Government (SME
  promotion, Business tourism, Black Economic
  Empowerment, etc.)
• Show Governments commitment to the promotion of
  public transport (National Land Transport
  Transitional Act, Act 22 of 2000)
• Improve the image of public transport with this
  project and attract more car users to public
  transport

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Gautrain Key Objectives (2)

• To promote business tourism by means of the link
  between JIA and Sandton
• To contribute towards urban restructuring,
  shortening travel distances and improving city
  sustainability
• To link to the Tshwane Ring Rail Project, linking
  Mamelodi, Atteridgeville and Soshanguve /
  Mabopane
• Stimulate the renovation and upliftment of the
  Johannesburg and Tshwane CBDs
• Link the main economic nodes in Gauteng with JIA
• Part of holistic transport plan and network for
  Gauteng

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Hatfield
Pretoria
Centurion
Midrand
Marlboro
Sandton
Preferred Route
Rhodesfield
Anchor Stations
JIA
Rosebank
Stations
Airport
Park Station
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Technical specs

• International standard gauge
• Maximum speed 160 180 km / h
• Modern state of the art trains
• Thus totally different from existing SA system
• Different trains for commuters and air passengers
• Initial demand 104 000 passengers trips per day
• Frequency every 10 30 minutes
• Minimum operating hours 05h30 20h30
• Safety and security

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Feeder and Distribution Services

• Access to the Gautrain - one of the key success
  factors
• Initially a large part of the market segment not
  within walking access of stations
• Provide dedicated bus services
• Door-to-door service and travel time
• Convenience of transfers
• Same quality and Level of Service offered from
  point of access to front door at destination
  end of trip
• Integration with existing and other new systems
• Ample park and ride facilities

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Concept
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Interesting facts (1)

• 104 000 passengers per day are estimated to
  travel on Gautrain
• Approximately 78 new commuter rail coaches will
  be manufactured
• Approximately 250 new bus coaches will be used
• 3,6 million train kilometres and 674 million
  passenger kilometres will be travelled per year
• 10,6 million bus kilometres will be travelled per
  year
• There will be a train at least every 10 minutes
  during the peak time at stations between
  Johannesburg and Pretoria.

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Interesting facts (2)

• 260 000 concrete sleepers will be manufactured
  for use in the track
• 20 000 tons of steel will be required to
  manufacture the steel rails
• 112 000 m² of bridges and viaduct structures will
  be constructed
• More than 9 000 new parking bays will be required
• 65 road intersections in the vicinity of stations
  will be upgraded
• 48 000 jobs will be created during construction

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PPP Process
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Project Process

• Fundamental Principles
• Multi-billion Rand project
• Cannot be funded in total by Government
• Can only be developed as a Public-Private
  Partnership
• PPP project (BOT type project)
• Must have political buy-in the private sector
  must show an appetite for the PPP project
• Must comply with all legal requirements

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RFQ Qualified Bidders

• Bombela Consortium
• Bombardier Transportation
• Bouygues Travaux Publics
• Murray Roberts
• RATP International

• Gauliwe Consortium
• CAF
• Dragados
• Grinaker LTA
• Metro de Madrid
• CANAC

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BOT Advantages

• What each party brings to the BOT

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BOT Advantages

• What each party get from a BOT

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Implementation Process

• Four pillars
• Political will commitment
• Viable project (base case design)
• Technical
• Financial
• Legal/Institutional
• Funding (for Infrastructure Operations)
• Governments portion
• Private Sectors portion
• Community acceptance Buy-in
• Socio-economic benefits
• Power of expropriation

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PPP Requirements

• Feasibility
• Value for money
• Public Sector Comparator (PSC)(What will it cost
  if Government does the work through
  normalprocurement process and including
  completion and integrationrisk and cost)
• Affordability
• Total cost of project, expressed in Net Present
  Value (NPV)
• Yearly cost to the province (contingent
  liability)
• Maintain the 80/20 ratio in social vs.. rest
  split in budget

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PPP Requirements (continue)

• Feasibility (continue)
• Risk transfer
• Identify, cost and allocate various risks to the
  role players best equipped to mitigate and manage
  them

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PPP Components

• Technical content
• Financial proposal
• Legal mark-up
• Socio-economic Development

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EconomicInformation
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Modelled Single Journey Fare
Cost less than car, more than existing bus / taxi
/ rail
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What Will the Economic Impact Be?

• Number of jobs created / sustained
• Construction 57 000
• Operating and Maintenance 2 200 p.a.
• Urban economic activity 40 000 p.a.

Increased business sales R 6 billion

Increase in Gauteng GGP 0,7 - 1
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Way forward
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New Pressures

• After 2004 elections
• Top priority is to focus on job creation
  fighting poverty
• Timing of the completion of the project to
  coincide with the FIFA 2010 World Cup
• Pressure on approvals authorisations

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Summary of Tender Process
Investors Conference
Announce pre-qualified bidders
Construction Commence
EIA Report Draft EMP
Announce Preferred Reserve Bidder
RFQ- Process
ROD
Final EMP
ROD Appeals
EIA - Process
Prepare RFP documents
RFP Phase II
RFP Phase I
RFP Phase III (BAFO)
FinancialClose
Negotiate with Bidder(s)
Detail Design
Infrastructure Act requirements
Proclamation and Land acquisition
30 Sep 2003
29 Nov 2002
Sep 2001
End April 2002
21 Oct 2002
Apr 2005
Oct 2005
29 Sep 2003
Apr 2004
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Development and Operation
Contract Term (19.5 years)
Development Period (54 mths)
Operating Period (15 years)
Oct 05
Mrt 05
Enabling Works
Dec 08
Construction Commission Sandton JIA
Dec 09
Construction Commission Remainder of the System
Operations Maintenance
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The Seven Stages of a PPP Project

• Enthusiasm
• Promises Programmes
• Disillusionment
• Panic
• Hunt for the guilty
• Punishment of the innocent
• Reward for those who had nothing to do with it

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Thank You

• www.gautrain.co.za