Huge hike in pipeline cost

2010-03-13 00:00

JOHANNESBURG — The cost of Transnet’s new fuel pipeline linking Durban with Gauteng has risen by R2,7 billion.

The pipeline, which would have cost R12,6 billion last year, will now cost R15,4 billion. Its completion date is set for December 2012.

Neville Eve, Transnet’s head of capital projects, said the decision to install electricity generators at all pump stations has added R180 million to the bill. Steel costs have also risen by as much as R1,06 billion since 2007.

Transnet CEO, Chris Wells, said the parastatal will fund the increased cost. Once the project is finished, tariffs will rise — which will affect consumers. Transnet has asked the National Energy Regulator to increase the tariffs on its existing pipeline by 51,3% from April 1.

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