Kenya: Tender issued for high speed line

[John Ashworth]

High speed train right on track

By JUSTUS ONDARI
Posted Monday, September 7 2009 at 22:30
Daily Nation

In Summary

* The journey to Mombasa from Nairobi will be just three hours

Imagine travelling at 160km per hour... in a train!

The prospect of this dream becoming a reality in Kenya grew on Monday when Kenya Railways Corporation advertised a tender for a standard gauge line to run from Mombasa to Malaba.

Such a line would shorten the train journey from Nairobi to Mombasa from 10 to only three hours.

Prospective transaction advisers and design consultants have until January 15, 2010, to forward their bids.

Assignment

Their proposed assignment includes project marketing, investor identification and supporting selection of consultants to monitor detailed design, building and commissioning of the railway.

“Construction is scheduled to commence in May 2011,” the corporation’s managing director, Mr Nduva Muli, said in a two-page paid up advertisement.

The railway line, which will stretch from Mombasa to Malaba on the Kenya/Uganda border with a branch to Kisumu, would see double-decker passenger trains introduced in the region.

According to the government’s timetable, the Mombasa-Nairobi section of the line will be complete by 2013, Nairobi-Kisumu by 2016, and Nairobi-Malaba by 2016.

“The government recognised the need to build the new modern railway in order to increase capacity and improve efficiency, cost-effectiveness and competitiveness of the transport sector,” the advertisement says.

The move signals the government’s admission that the 25-year concession of the current Kenya-Uganda railway to Rift Valley Railways, a consortium led by South Africa’s Sheltam Ltd, in 2006 has not lived up to its expectations.

The concession to RVR is the subject of a court case after Kenya Railways Corporation expressed a desire to terminate the contract.

In this year’s budget, Sh3 billion was allocated to initiate the revamping of the over 100-year old railway system.

[John Ashworth]

PRESS RELEASE

A NEW RAILWAY FOR KENYA

Kenya Railways has commenced the process of building a modern high capacity Standard Gauge railway line for Kenya. This was announced by the Managing Director of Kenya Railways Corporation Nduva Muli, at a Press Conference held at the Kenya Railways Headquarters today. This follows a Request For Proposals (RFP) for a Transaction Adviser in a paid-up International Tender advertisement released by the Corporation on 8th September 2009 in the local and international press.

Speaking during the media briefing, Mr Muli said that the Mombasa- Nairobi- Kisumu-Malaba line is one of the 3 major railway lines in the national railway Master Plan that has been developed by the Corporation. The other lines are Lamu- Juba and Nairobi- Addis Ababa and plans for these are at an advanced stage. The new railway line will meet increased transport demands that are projected to be in excess of 30 million tonnes by the year 2030, against the current 17 million tonnes that pass through Mombasa Port. Freight volumes have grown beyond previous projections and already outstrip available transport capacity- both road and rail, causing perennial congestion at the Mombasa Port. The situation is bound to get worse with a projected freight growth of 8% annually. The current 100-year old Metre Gauge railway line has limited capacity and cannot cope with the increased demand.

Transportation costs in Kenya and the East Africa region constitute 40 -45% of the total cost of production, against a global average of 15%, which makes local products uncompetitive in the global markets. In India and China for example, railway transport accounts for 90% of the long distance freight movement; in Kenya a meagre 5% is what is transported by railway, causing pressure on the road network.

The new railway will be a high capacity Standard Gauge railway with freight trains hauling a minimum 4000 tonnes – on over 1 km long trains, compared to the 800 tonnes on the Metre Gauge railway. Freight trains will be operating at an average speed of 120Kph, and Double Decker passenger trains at an average speed of 160 kph. Current operating speeds on the meter gauge railway are between 30 and 45Km/h at best.

The Transaction Adviser will undertake the following:

1. Undertake a preliminary design for the new railway which will include route selection

2. Develop a suitable financing, construction and operating model for the railway. Available options include Design-Build-Operate-Transfer or Design-Build-Transfer-Operate among others.

3. Recommend legal and regulatory review to support the proposed model and railway operations in future.

4. Undertake marketing and stakeholder communication throughout the process.

5. Develop bid documents and support KRC in the bidding and evaluation process to identify the most suitable investor.

6. Support the identification of competent Engineering Consultants to undertake the supervision of the construction and commissioning of the new railway.

According to the time-table set by Kenya Railways, all studies are expected to be complete by March 2011 and investors will be on board by July 2011, while construction is expected to start in November 2011. The Mombasa- Nairobi section is scheduled for completion in 2013, and Mombasa- Kisumu- Malaba section will be complete by 2016. It is envisaged that the Government of Uganda will also commence the construction of the section between Malaba and Kampala and a bilateral agreement to facilitate the same is being discussed by the two governments.

Kenya Railways will keep Kenyans continuously briefed on the progress of this major development of our railway system and we look forward to the support of the media to relay up-to-date information to Kenyans.


NDUVA MULI

MANAGING DIRECTOR


September 9, 2009

For more information please contact:

Corporate Affairs Division

Kenya Railways

Tel: 0722775925 / 0722713620

gtatache@krc.co.ke/wmwaniki@krc.co.ke

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