New export freight deal for BHP South African coal

South African freight haulage operator Transnet has signed a 10 year deal with BHP Billiton for coal haulage to shipping ports.

The 24 billion-rand (A$24.3 billion) contract is the first major contract for the Johannesburg-based transport company, which will see 17-18 million metric tonnes of the fuel hauled annually from BHP’s mines in the eastern Mpumalanga province to the Richards Bay Coal Terminal on the country’s north-eastern coast.

Transnet CEO Brian Molefe said the agreement with BHP would be a massive boost for certainty around Transnet’s capacity-expansion programs on the export-coal line.

Molefe said Transnet will strike 10-year deals with up to 28 other coal customers before the end of November, including Baar, Glencore Plc and Exxaro Resources.

Transnet Freight Rail has plans to haul 75 million tonnes of coal in the year ending March 2015, compared with the previous year’s 68.2 million tonnes, which accounted for 32 per cent of Transnet Freight Rail’s total volume.

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