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RVR finally begins ambitious railway upgrading plan

BUSINESS
By By John Oyuke | July 19th 2012
By By John Oyuke | July 19th 2012
BUSINESS

By John Oyuke

Rift Valley Railways (RVR) – the Kenya-Uganda railway concessionaire – has finally embarked on an ambitious effort to bring new life to the regional rail transport and ease pressure on roads after spending six years sourcing for funding.

It has secured its first batch of rail equipment worth Sh1.6 billion ($19m) to undertake redevelopment of the worn-out sections of the Nairobi-Mombasa railway line in order to allow for bigger capacity trains and increased line-speeds.

It has shipped in 10,000 sleepers, 6,869 metric tonnes of rail bars and other rail materials to repair the 70-km rail track so as to increase freight volumes by increasing off-take by the railway from Mombasa port. Rail transport has so far been constrained by inadequate capacity of RVR.

The regional rail operator has also commissioned another project in Uganda as it seeks ti revitalise railway transport.

Enhance transit time

Chief Executive, Brown Ondego, said the main focus is to improve the condition of the permanent way so as to enhance transit time, increase line speed from the current 25- 30km per hour to 70km per hour, and provide reliable and quality rail services.

The first tranche of a loan package signed in August last year has been used to buy materials to repair the Nairobi-Mombasa rail track. Over the next five years, the firm plans to invest Sh24.08 billion to upgrade its trains and railway lines. It has also lined up a programme to increase quality and quantity of rolling stocks, and enhance overall efficiency of the railway system.

“We expect to start laying the permanent way immediately and we progressively increase speeds on the back of the developing efficiency on the tracks.” Ondego explained while receiving the materials last Friday.

Ondego said the railway concessionaire has also commissioned the construction of nine culverts on the Uganda side of the track –  between Busembatia and Jinja – at a cost of $4.9million, which the firm expects will be completed by December.

Bigger capacity

“Once these two projects are complete, the reliability and efficiency of our operations will improve significantly as we will be able to run bigger capacity trains, thereby improving our loading capacity and reducing the operation’s transit times,” he added.

RVR has recently come under criticism for failing to meet benchmarks agreed on when they signed a 25-year-concessionaire deal in 2006. The agreement between Kenya, Uganda and the RVR consortium was signed in November.

Meanwhile, the Kenya Shippers Council and Kenya Association of Manufacturers  members have taken a swipe at RVR following perennial congestions at the Port of Mombasa.

Agreement

RVR,  which is jointly owned by Egypt’s private-equity company Citadel Capital (51 per cent), Kenya’s Trans-Century (34 per cent), and Uganda’s Bomi Holdings (15 per cent),  has signed loan agreements amounting to $164 million to fund its operations last year.

Speaking while witnessing receipt of the materials, Transport Permanent Secretary, Cyrus Njiru, said the Government is keen to bring back the Mombasa-Malaba-Kampala railway line to its former design capacity of carrying at least 35 per cent of freight.

“At the moment the rail network in Kenya carries only four per cent of freight, while the other 96 per cent is carried by road,” he Njiru said.

Kenya Ports Authority Managing Director Gichiri Ndua said the railway system’s capacity in the country need only to be increased by about 15 per cent for Kenya to match many of the developed countries.

“If we can be able to move the capacity of the railway to anything around 17-20 per cent for our port, we would be doing a great deal of service, because in Europe today the average off-take or leverage of the rail system is about 17 per cent,” he said.

 


 

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