TransNamib forks out millions in train derailment costs

It costs TransNamib over N$1 million to clear a major derailment, the rail operator CEO Johny Smith revealed in an exclusive interview with The Brief.

The revelation comes as the rail company has recorded numerous derailments over the past two years, with two already recorded this month.

“Derailments of course depend on the severity of the accident and it also depends on where the accident has occurred and the resources that we require. Sometimes when we have a major derailment, it normally takes about 2-3 days to clear the line and if it's on a level area it’s easier and if we do require extra equipment, like we have to rent in a crane etc, it does cost more for the company,” Smith said on The Brief Interview.

“On average if it’s a major derailment, it could cost anything from N$1 million upwards depending on the severity of the accident.”

He said the regular occurrences of derailments, which impacts the operations of the business, were being caused by old infrastructure and rolling stock which is now over 60 years old.

“When there are derailments, there are normally three reasons, either the rolling stock, you can imagine our rolling stock is 60 years old and it hasn’t been maintained to the levels that it's required in terms of the locomotives and the wagons,” he said.

Smith added that the government has already started funding the rehabilitation of the country’s railway infrastructure, while the company is intensifying its safety training for staff as part of measures to address the regular derailments occurrences.

“The rail infrastructure, where the government has now put a plan together in terms of focusing on rehabilitation of railway lines and some of it is already in progress. Then there is of course the third element, which is the human element and we have already started to put certain training and development plans in place where some of our safety personal has gone out to different regions to start with training and to ensure that certain programs are followed on a daily, weekly basis to ensure that we improve safety,” the TransNamib CEO said.

Smith said the company was still finalising the terms and conditions of a N$2.6 billion loan facility arranged by the Development Bank of Namibia and the Development Bank of Southern Africa, which will see 30 locomotives being remanufactured, while 10 brand new ones will be bought.

“In the short term, while we get there, we still have to spend some money on the maintenance of our existing locomotives to keep them moving to increase our revenues in the short to medium term. So there is still a lot that we need to do now, while we are realizing the funding for the projects that need to be developed to implement and improve our capacity from a rolling stock perspective.”

Smith, however, said the company was currently in need of short-term funding to maintain its existing operations, while awaiting the finalisation of the loan facility, a process which could last at least two years.

 

“In the very short term now it is the availability of short-term cash to be able to provide to our needs in terms of repairs that we need to do to our rolling stock immediately. Then we have some legacy issues that we need to resolve in the short to medium term, there is a lot that we need to do to overcome.”

TransNamib has been facing numerous challenges over the past few years. In October, the company revealed to The Brief that it was faced with a locomotive shortage with only 25 operational out of a requirement of 75, and was betting on the refurbishment of 33 of its locomotives and a stopgap lease of seven more to improve operational efficiency and drive-up revenue.

TransNamib is earmarked for a N$175 million government subsidy for the 2022/23 financial year and N$523.6 million over the Medium-Term Expenditure Framework.

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Last modified on Tuesday, 10 May 2022 19:16

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