Tuesday 11 August 1998
The Minister of Transport Mac Maharaj and the chairperson of the South African National Roads Agency Barry Adams today jointly announced that the N3 Toll Road Consortium was the preferred bidder for the R2,5 billion contract to upgrade a section of the N3 between Durban and Johannesburg.
Maharaj said that negotiations to conclude the contract will now start between the South African National Roads Agency (SANRA) and N3 Toll Road Consortium (N3 TRC). He thanked the other shortlisted consortium, Mafube, for their commitment to the project.
The N3 Toll Road Consortium comprised of construction groups LTA, Grinaker and Murray and Roberts together with consultants BKS and Africon. Other shareholders in this consortium included Rand Merchant Bank, NBS Boland, Sumitono Bank, Impumelelo empowerment group, Evzone, the Women's Development Bank, Fikile Projects, Infra Africa, Nkobi Investments and the PIC Development Fund.
The other bidder, Mafube Consortium, comprised of construction groups Group Five, Concor and WBH-O together with consultants Stewart Scott and Keeve Steyn. Shareholders in this consortium included Nedbank Investment Bank, First National Bank, Deutsche Morgan Grenfell, Kopano ke Matla Investment Company, Investments Progress Group and Worldwide African Investment Holdings.
This is the second major Build, Operate and Transfer (BOT) road project to be undertaken in South Africa. BOT is a mechanism for implementing projects which relies upon the private sector to raise funds for public projects, to build and operate them at a profit, and then hand them back to the State at the end of the contract period. The ownership of the road remains with government while its management is undertaken by the private sector.
Maharaj welcomed the progress in this major road project not only as another significant public-private partnership with the private sector to fund infrastructure development, but also the innovative way in which it will be financed.
"The successful bidder on the N3 will also take on the State's existing debt of R1,2 billion on the road as well as improve existing and build new sections, operate them and return the infrastructure back to government in good condition and free of debt after the concession period," he said.
The contract is for the construction, financing, operating and maintenance of 420kms from Cedara (in KwaZulu-Natal) to Heidelberg (in Gauteng) as a toll road and the development of associated facilities under a 30-year concession contract to be managed by the SANRA.
New work along the route includes the construction of a dual carriageway between Villiers and Heidelberg. Maintenance and rehabilitation work will be undertaken on the existing toll roads between Cedara and Keeversfontein and between Warden and Villiers, and will also include all future upgradings.
Also in the contract (and depending on traffic requirements) is the proposed construction of a section of road between Keeversfontein via De Beers Pass to Warden, which will shorten the route between Gauteng and Durban by 13 km.
It is anticipated that construction will start in the first half of 1999. Initial construction will take approximately three years after which the road will be periodically upgraded over the 30-year concession period to comply with pavement and level of service requirements.
Tender documents for the project were released on 1 July 1997. A compulsory site inspection was held on 25 and 26 July 1997, which was attended by the four pre-qualified tenderers. Tenders closed at 11:00am on 12 December 1998 and the bids were recorded in public in the then South African Roads Board Chamber (SARB) in Forum Building, Pretoria.
Tenderers were then invited on 30 and 31 March 1998 to make a presentation to the full evaluation team on their submissions. The two bidders who remained after initial evaluations, submitted their best and final offers on 24 July 1998. The evaluation team comprised of national and international experts in the fields of environmental management, entrepreneurial development, engineering, finance and legal service. Their recommendation went to the SANRA board last week, who passed it on to the Minister of Transport for the final decision.
As part of the criteria for their bids, the consortiums were required to stipulate what training and skills-transfer programmes would be undertaken in respect of the creation of job opportunities for developing contractors and SMMEs. The emphasis was not only on vocational training but also supervisory and management training and the transfer of construction-related skills with set targets to ensure compliance with tender requirements that are in line with government's growth objectives.
It's anticipated that over 25 000 jobs will be created and over 500 SMMEs will benefit from this project.
Maharaj said that both N3 TRC and Mafube proposed impressive partnerships for the implementation of the project.
He said that the approach adopted by both consortia represented a significant new departure in the promotion of co-operative ventures between small and large enterprises, re-affirming in practice government's commitment to the principles of affirmative action and economic empowerment of previously disadvantaged sectors of the community.
CEO of the NRA Nazir Alli said: "The goal of broad economic empowerment will be realised through spending targeted at equity participation, the development of emergent entrepreneurs, skills transfer in the field of civil engineering, project management, literacy, community participation and the implementation of wider social development programmes."
Issued by Didi Moyle: PA and Media Liaison Officer to the Minister of Transport 11/8/1998