Transnet seals over €499m contract with United Manganese of Kalahari

Transnet SOC has signed another Manganese Export Capacity Allocation (MECA 2) contract with United Manganese of Kalahari (UMK), the fourth largest manganese producer in South Africa.

The seven-and-a-half-year contract is worth over R*8bn (€499m) and will allow UMK an allocation of both rail and port capacity through the different manganese export channels in South Africa. The allocation agreement is inclusive of the transportation, storage, and loading on-board a vessel of the UMK production destined for the export market.

The manganese from UMK will come mainly from the Kalahari Manganese fields in the Northern Cape through to the Port of Saldanha on the iron ore railway line, Port of Port Elizabeth, and the Port of Richards Bay.

Since the inception of the MECA2 programme in 2015, Transnet has witnessed an increase of manganese export volumes from 5m tonnes per annum to the current 15.1m tonnes per annum.

Transnet together with key manganese producers have set aside 15% of the overall manganese export line capacity for the new entrants in the manganese export market.

The contract will be back-dated from September 2015 until March 2023. The contract term is aligned with Transnet’s Manganese Expansion plans to create capacity ahead of demand in freight, ports, terminals and rail systems in the country. South Africa accounts for close to 75% of global manganese reserves. The project aims to retain the country’s position as the leading exporter of high-grade manganese ore.

*R = US$ 0.070 / € 0.062

Source: Transnet