TFR lifts force majeure on coal line to Richards Bay following November 10 derailment

TRANSNET Freight Rail (TFR) has lifted the force majeure on its North Corridor line that routes coal from mines in the Mpumalanga and Limpopo provinces to Richards Bay.

This follows the derailment of a 97 fully laden coal train on November 8 – an event that was preceded by community threats, the government-owned company said. The force majeure was in effect for 15 days.

The derailment, which occurred between Bloubank and Nhlazatshe stations, caused “massive damage” to infrastructure and rolling stock, said TFR. This required the closure of both lines and negatively affected the service from the mines to Richards Bay “hampering the performance of contractual obligations by Transnet and coal export parties”, it said.

Although the lines were reopened on November 19, TFR said it was not in a position to resume normal services at full capacity as “certain critical restoration works” remained outstanding.

“The recent assessment of the site indicates that the normal resumption of services on the coal line can be immediately phased in,” it said in a statement Friday. “Accordingly, the force majeure declared on November 10 was lifted today.”

The derailment led to logjams on Richards Bay’s roads as exporters sought to transport goods by truck.

It remains to be seen if the event, following a two week strike at TFR holding company, Transnet in October, will damage the company’s chances of achieving 60 millons tons (Mt) in coal deliveries for its 2022/23 financial year, ending March 30.

“We have not revised the 60Mt,” said Ali Motala, managing executive for the North Corridor at TFR (Transnet Freight Rail) in October. As per its contract terms with customers, TFR grades its performance from April to March 2023.

The Minerals Council calculated that including the effects of the strike, as well as Transnet logjams, the country would suffer annualised revenue losses of R50bn this year, 43% more than R35bn last year. This covers losses on revenue of iron ore, coal, chrome, ferrochrome and manganese exports.

It said that R151bn could be gained in additional exports, with the concomitant benefits of employment in mining increasing by 40,000 jobs to 500,000, the fiscus benefiting from improved tax revenue and higher revenues for Transnet if all rail and ports systems were optimally and efficiently run at design capacity.

1 COMMENT

  1. How often can TFR get away with declaring force majeure before its customers say enough and kick back through the courts? A train derailment is hardly an unforeseeable event, and if it happens it is firmly the fault of the rail operator. What is the point of a contract if one party can simply invoke force majeure every time it fails to keep to its side of the contract?

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