Mpumalanga province in eastern South Africa produces virtually all of the country's 71 million tons of exported coal. A double-lane, heavy-haul freight railway connects Ermelo, Mpumalanga province, to the RBCT. Known as the Ermelo-RBCT railway, the line carries relatively little general freight — roughly 14 million tons per year. Its primary purpose is transporting coal produced at Mpumalanga to the RBCT. After general freight, the Ermelo-RBCT railway has a capacity of only 68 million tons of coal per year — well below the RBCT's export capacity of 91 million tons per year.

Infrastructure Overhaul

It is this discrepancy that led Transnet to remedy the situation. Transnet will invest about $36 billion on infrastructure development projects, about 70 percent of which will go toward mining industry development. By 2019, development projects will increase coal transport capacity to 97.5 million tons per year.

One project is particularly important to South Africa's transport infrastructure overhaul. A new railway slated to be completed by 2015 will begin at Ermelo and pass through Swaziland before connecting to the RBCT. It will extend to the port of Maputo, Mozambique and the recently proposed Mozambican port of Ponto Techobanine. Jointly funded by South Africa and Swaziland at a cost of $1.5 billion and $600 million, respectively, the new railway will be used for general freight transport. With a capacity of 15 million tons per year, the railway will carry freight that otherwise would have been shipped via the Ermelo-RBCT railway. This will free up the Ermelo-RBCT to transport greater amounts of coal for export.

Other projects under consideration include expanding the export capacity of the RBCT from 91 million tons per year to 110 million tons per year. Such a project could commence in as few as five years, but the RBCT is expected to receive only 81 million tons per year through 2016. The estimated production of 20 million tons per year from coal mines in Waterberg, Limpopo province, could contribute to the RBCT's expanded capacity. However, South Africa first would have to build railways linking Waterberg to the RBCT. 

Solidifying Its Position

While transport infrastructure in South Africa is insufficient, the country at least has adequate export facilities and access to the sea. Other southern African countries, such as Botswana and to a lesser extent Mozambique, must rely on South Africa to help export their coal reserves. This has helped South Africa become the dominant transport corridor in southern Africa — a position Pretoria will use the infrastructure development projects to maintain.

Landlocked Botswana has large coal basins but has few means to transport what it produces. On May 11, Botswana and South Africa announced that they had begun a feasibility study on a joint project to connect Botswana's coal-rich Tuli block with Waterberg, an emerging coal-production region in northern Limpopo province, South Africa. The project would also include the construction of a heavy-haul railway from Limpopo to Ermelo with a capacity of 112 million tons per year. If implemented, the project would not be completed until 2026.

By working with South Africa, Botswana has given itself an attractive alternative as it decides between Namibia's Walvis Bay and the RBCT. Should Botswana choose South Africa over Namibia, the likelihood of another viable transport corridor developing in southern Africa would be quite small.

Compared to its neighbors, South Africa already has serviceable transport infrastructure in place. With the impending upgrades, higher volumes of coal export are entirely possible; in the long term, the output could be substantially higher. In any case, South Africa likely is cementing itself as the only transport corridor in the region.