1 / 21

Transnet's Role in Jet Fuel Logistics for 2010 FIFA World Cup

This presentation outlines the challenges and role of Transnet Pipelines and Transnet Freight Rail in supplying jet fuel for the 2010 FIFA World Cup. It discusses the complex supply chain, potential challenges, and Transnet's actions to meet the increased demand.

Download Presentation

Transnet's Role in Jet Fuel Logistics for 2010 FIFA World Cup

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. PRESENTATION TO JOINT PARLIAMENTARY PUBLIC HEARINGS ON THE STATE OF READINESS FOR THE 2010 FIFA WORLD CUP 18 – 19 MAY 2010

  2. OUTLINE OF PRESENTATION • INTRODUCTION • THE CHALLENGES AND ROLE OF TRANSNET PIPELINES • THE CHALLENGES AND ROLE OF TRANSNET FREIGHT RAIL • THE COMMITMENT OF TRANSNET NATIONAL PORTS AUTHORITY • CONCLUDING REMARKS

  3. THE CHALLENGES AND ROLE OF TRANSNET PIPELINES (“TPL”)

  4. THE ROLE OF TRANSNET IN JET FUEL LOGISTICS IN SOUTH AFRICA • Transnet Limited (Transnet”) through its divisions Transnet Freight Rail (“TFR”) and Transnet Pipelines (“TPL”)) is primarily involved, in respect of the Fifa World Cup 2010 (“WC2010”) process with the supply of jet fuel to the O R Tambo International Airport (“ORTIA”), - all other airports are supplied by road, except Port Elizabeth Airport and the former Durban International Airport which are supplied by pipelines owned and operated by members of the oil industry. • The supply of jet fuel to ORTIA is complex and involves many role players: • SA oil industry (as producers or importers of the fuel); • Transnet as transporter of fuel from two different points of supply, as required by the International Association of Travel Agency (“IATA”), for security of supply reasons; OR Tambo Airport Fuel Supply (“ORTAFS”), agent of the oil industry, which is currently managed by Chevron; and • • The Airports Company of South Africa (“ACSA”). • The total requirement for ORTIA jet fuel supply are as follows: • The current demand is 4,5 million litres per day (“Ml/day”), thus the supply system is required to deliver 33 million litres per week (“Ml/w”); • This demand is anticipated to rise to over 10Ml/day on peak days during the FIFA World Cup 2010 (“WC2010”); and • At present and also for the WC2010 period, stock levels of the jet fuel can not go below a 3 days requirement (ACSA stipulation).

  5. FUEL SUPPLY CHAIN LOGISTIC AND MARKET ANALYSIS WITH VOLUME TARGETS : C-ZONE 2010/11 Demand Forecast Refined Products 5.1 bl/a C-Zone Total Requirement Pipeline feed 15.9 bl/a DJP SECUNDA REFINERY Sasol NATREF REFINERY Sasol, Total COP Pipeline feed Refined Products 4.9 + 0.3 bl/a Rail & Road Diesel in Crude Refined Products 4.4 bl/a (DIC) 0.3 bl/a Crude Oil Rail & Road Slippage 1.2 bl/a 5.4 bl/a DURBAN COMPLEX ENREF Rail & Road SAPREF REFINERY BP, Shell Loading ENREF REFINERY Engen SAPREF BERTHS (5,6,7,8,9) IMPORTS DJP – Durban Johannesburg Pipeline COP – Crude Oil Pipeline

  6. DIAGRAMMATIC LAYOUT OF COMPLEX SUPPLY CHAIN FOR JET FUEL TO OR TAMBO INTERNATIONAL AIRPORT ORTIA Complex (ACSA)1 ORTAFS2 Total Requirement 33 Ml/w Rail Loading NATREF REFINERY Sasol, Total Requirement 22 Ml/w Swing supply to ensure Transnet meets average requirements – currently 10 Ml/month DURBAN COMPLEX Rail Off Loading DJP3 ENREF Requirement 11 Ml/w ENREF REFINERY Engen SAPREF REFINERY BP, Shell SAPREF BERTHS (5,6,7,8,9) 1 Airports Company of SAIMPORTS 2 OR Tambo Airport Fuel Supply 3 DJP – Durban Johannesburg Pipeline (12")

  7. POTENTIAL JET FUEL LOGISTICS CHALLENGES DURING THE FIFA WORLD CUP 2010 • Typical issues that can, in general, cause disruptions in the supply chain include: • Production problems (availability of product) at the 4 refineries involved; • Product quality at points of entry into transport/logistics system (local production and imports); Loading challenges at points of entry for TFR; Challenges of transportation by rail and pipelines; Off-loading challenges at ORTIA; and Available storage capacity at ORTIA. • • • • • Other more specific issues that play a role in disruptions or delays in such a chain are: • ESKOM power interruptions and reliable power supply; • Weather conditions (cannot load Rail Tank Cars (“RTCs”) in the rain in Durban; Cable theft challenges for TFR and TPL; Faulty equipment and system failures; • • • Commercial arrangements (contracts of supply) between SA Oil Industry members; and Personnel issues throughout the chain (skills, availability, etc). • • Absolute requirements for such a complex system are: • Excellent communication and reporting; • Co-ordinated team-effort by all role players; and • Strong leadership through the Department of Energy (“DOE”).

  8. SUMMARY OF WC2010 CHALLENGES AND WAY FORWARD Present expectations of demand for period of WC2010: Total additional volumes of jet-fuel required at ORTIA : Range between 46 and 107 million litres. Combined petrol and diesel additional demand in Zone C : 23 Million litres. Petrol and diesel volumes displaced by jet-fuel in the DJP, which require additional logistics capacity from the coast, range between 138 and 45 million litres. Transnet’s high level actions to meet requirements for jet fuel to ORTIA and additional petrol and diesel capacity from the coast are: Ensure 24 Ml/week transported by TPL from Natref to ORTIA by the dedicated pipeline every week during WC2010. Ensure 14Ml/week transported by TFR between Durban and ORTIA by rail every week during WC2010. Transport 10Ml/week of jet fuel through the DJP from Durban every week during WC2010 (presently 5Ml/month on average). The above actions will ensure more than sufficient capacity for jet fuel in the low level case and will leave only 9Ml/w short over the whole period for the high level case (one extra slug of 10Ml in the DJP over the 8 week period). For additional capacity needed for petrol and diesel from coast, 2 slugs of diesel or petrol in the crude oil pipeline (1 per month) are proposed, which will be sufficient for the requirements of a low level case (DIC/PIC initiative). For the volumes required for the high level case, attempts to be made by TFR, TPL (ex Secunda; Natref) as well as all round stock-piling initiatives (TFR spare RTCs; TPL tankage as well as stock piling with all other roleplayers) to achieve required capacity. As final fall-back only: to increase present road transportation.

  9. THE CHALLENGES AND ROLE OF TRANSNET FREIGHT RAIL (“TFR”)

  10. TRANSNET FREIGHT RAIL CAPACITY BREAKDOWN: DURBAN/ORTIA Installed capacity = 18 Ml/w Being tested till end May 2010 Operational capacity = 16 Ml/w Realistic supply = 14 Ml/w Simulation model assumes this performance

  11. TRANSNET FREIGHT RAIL JET FUEL FLOWS AT TIME OF WC2010 Matola (Mozambique) Possible Supply 1.8 Ml/w Isando Requirement 14 Ml/w Bloemfontein Requirement 0.58 Ml/w Durban Loading site Off-loading site

  12. BUT TRANSNET FREIGHT RAIL’S CURRENT SUPPLY CHAIN CAPABILITY HAS CONSTRAINTS ORTIA – can offload at best 40 RTCs per day (DAY shift only) BOTTLENECK RAIL – can move 2 x blocks of 39 RTCs per day SAPREF/ENREF – can load 64 per day (32/32 split) NO CANOPIES

  13. ACTIONS PLANS • Standby crew slots were increased from 25 February 2010 to ensure crew delays are eliminated. • Shunts at Loading and Offloading ends for jet fuel have been enhanced to ensure no shunt delays are experienced. • Jet fuel RTCs are being increased from the current fleet of 313 to as follows: - • Target date: 14 April 2010 = 321 RTCs • Target date: 30 April 2010 = 381 RTCs • Target date: 28 May 2010 = 433 RTCs CHALLENGES • Security incidents and network unavailability remain a major threat to the service we provide. This leads to reductions in orders. • Product availability at the loading end.

  14. THE COMMITMENT OF TRANSNET NATIONAL PORTS AUTHORITY (“TNPA”)

  15. TRANSNET NATIONAL PORTS AUTHORITY MARINE SERVICES TO VESSELS • Vessels entering the port require ISPS (“International Ship and Port Security Code”) clearance before TNPA will allow them vessel to enter a port; • Vessels must also request a pilot, tug assistance and berthing assistance before entering a port; • The normal procedure is: • Vessels submit an arrival notice 72 hours prior to arrival; • TNPA generates a 72-hour planning list; • Vessels confirm arrival 24 hours prior to arrival; • TNPA generates a 24-hour planning list; and • Vessel movement is confirmed 4 hours prior to service when scheduling commences to provide marine services to the vessel. • Vessel service priority is determined based on first come first served requests; • When multiple service requests are received for the same time, priority is determined as follows: • Navy and Passenger vessels; • Container Vessels and Car Carriers; and • All other vessels.

  16. TRANSNET NATIONAL PORTS AUTHORITY MARINE SERVICES TO VESSELS DURING THE FIFA 2010 SOCCER WORLD CUP • Vessels will be expected to adhere to the same ISPS and Marine Service request procedures which facilitate proper and controlled planning of movements in/out of the port; • No special prioritisation procedures will be applied; • The Harbour Master has the final authority over vessel movements in the port and must be approached in all events where vessels may require urgent service; • The Harbour Master will assess the situation at the port and make the final decision – this is the normal process followed to deal with urgent vessel calls; and • The 72-hour and 24-hour planning lists provide a mechanism to assess the situation at the port and inform the Harbour Master’s decision-making.

  17. CONCLUDING REMARKS

  18. CONCLUSION • Transnet has made additional investment by increasing its fleet of jet fuel RTCs from the current • 266 to 400 by mid-May 2010, to ensure that South Africa hosts a successful event. • Transnet has committed 32 RTCs to be used as backup storage during the FIFA World Cup 2010. • One load of 32 RTCs will run once a week from Durban to Hamilton to feed Bloemfontein and Kimberley • airports only during the World Cup. • Jet fuel, including Diesel displacements in the pipeline and block trains from sourcing points will • enjoy absolute freight priority second only to passenger trains on the Durban Johannesburg Corridor. • Fuel vessel prioritisation at the Port of Durban will be dealt with without compromising other • economic activity in the country during this period. • Transnet as a key fuel logistics supplier for South Africa remains committed to obligation to safeguard the security of supply of petroleum products to ensure South Africa’s successful hosting Fifa World Cup 2010.

  19. CONCLUSION • • General suggestions for the FIFA World Cup 2010 risk mitigation in respect of stock-outs include: • • DOE minimising adjustments (increases or decreases) in fuel prices in South Africa • during the 3 month period (May, June, July). • • Commercial issues: • All available tank-space should be declared by all role players (TPL included) and used for • stocking-up purposes before the FIFA World Cup 2010. National Energy Regulator of South Africa could play a critical role in this regard. • • Stock management: • Managing stock at ORTIA should be improved with the use of a computer-based simulation model. Transnet has funded the development of this computer-based simulation model, which will improve the management of stock at ORTIA during the FIFA World Cup 2010.

  20. THANK YOU

More Related