R50 billion worth of tenders out to market

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MEDIA RELEASE

R50 billion worth of tenders out to market

Caption: SANRAL’s Chief Executive Officer (CEO), Reginald Demana

Pretoria, 2 September 2024 – The South African National Roads Agency SOC Limited (SANRAL) has announced that it is injecting at least R50 billion into the country’s economy. The national roads agency is currently evaluating 96 tenders worth R35 billion, while 86 contracts worth R15 billion have already been awarded since the start of the 2024/25 financial year on 1 April 2024.

The tenders currently in evaluation are spread across the country:

  • 34 tenders in the Northern Region (Gauteng, North West, Limpopo and Mpumalanga) worth R16.5 billion;
  • 24 tenders in the Southern Region (Eastern Cape) worth R3.8 billion;
  • 12 tenders in the Western Region (Western Cape and Northern Cape) worth R2 billion;
  • 12 tenders in the Eastern Region (KwaZulu-Natal and Free State) worth R11.7 billion; and
  • 14 tenders at Head Office, worth R839 million.

SANRAL’s Chief Executive Officer (CEO), Reginald Demana, said this was a significant achievement given the procurement challenges the roads agency faced in 2023/24.

“This achievement is a testament to SANRAL’s commitment to economic recovery for the road construction sector and South Africa at large and follows a significant setback to our procurement processes in 2023/24 when legal challenges to SANRAL’s Preferential Procurement Policy (PPP) brought all tenders to a halt,” said Demana.

“The awarded contracts, worth R15 billion, as well as the tenders worth R35 billion – which are currently at various stages of evaluation – are being adjudicated in terms of the Interim PPP. This was adopted towards the end of 2023 after countrywide consultations with interested and affected stakeholders,” he explained.

“Furthermore, this progress is indicative of improved stability at an operational level. On 1 July 2024, SANRAL appointed a Chief Procurement Officer. We are determined to improve on the achievement of R51 billion worth of tenders awarded in the 2022/23 financial year.”

Demana said SANRAL was pushing ahead to put out even more work, with a further R1.8 billion worth of tenders to be advertised in the coming days and weeks.

“SANRAL’s objective is not only to ensure that we maintain the existing national road network and to build new road infrastructure to facilitate economic growth, but to use the State’s spending power to see even more impact; this not only in terms of improved infrastructure but also economic opportunities that transform the economy and change people’s lives,” he said.

With maintenance being critical to the upkeep of the national road network, there are new five-year term Routine Road Maintenance (RRM) tenders on the cards across the country, particularly in relation to roads newly transferred to SANRAL.

SANRAL’s major projects currently in construction continue to progress rapidly, with significant improvements to key road infrastructure and even more significant economic impact at national, regional and local level. Scores of people have benefitted from job creation, skills development and tools enabling them to carve a pathway out of poverty.

  • N2 Wild Coast Road – The R20 billion N2 Wild Coast Road (N2WCR) project is picking up speed with four major contracts underway, including Msikaba Bridge, Mtentu Bridge, the construction of the road linking the Msikaba and Mtentu bridges, and the road leading from Lingeni Intersection to Msikaba Bridge. Earlier in August, SANRAL announced the imminent construction of the R2.2 billion road from Lingeni village to Msikaba Bridge anticipated for early 2025. To date, the Msikaba Bridge contract has created opportunities for 44 local suppliers, 48 service providers and 61 subcontractors to the value of R665.6 million. Over R115 million in wages has been paid, while R76 million has been spent on generic and community training to fulfil the specific needs of the community. On the Mtentu Bridge project, R250 million has been spent to date with 248 local labourers employed.
  • R56 Matatiele – The improvement of the R56 between Matatiele and the KwaZulu-Natal boundary is progressing well. Construction works on this R1.2 billion contract are being carried out over the entire 39km. The culverts and minor structure are ahead of schedule while earthworks are on track. A total of 250 workers sourced locally are currently on site and this number is expected to increase to 400 as the project continues. So far, 25 targeted enterprises have been engaged.
  • N2 KwaBhaca to Ngcweleni River – The R1.2 billion improvement contract on the N2 between KwaBhaca (formerly Mount Frere) and Ngcweleni River is progressing well. Service and access roads form part of this contract.
  • Moloto Road – Work on the R573 Moloto Road project is progressing steadily and SANRAL continues to reach great milestones with its land acquisition to continue with construction of upcoming phases of the project. SANRAL recently awarded a R893 million contract for the upgrading of section 2 of the project between KwaMhlanga and Enkeldoorn in Thembisile Hani Local Municipality as part of the multi-billion-rand development of the Moloto Road Corridor. The 10km portion in Mpumalanga is almost complete. For Limpopo, the 7km section was completed in February 2024. The 23km portion from Toitskraal to Marble Hall is currently under construction. The agency is at the point of appointing a contractor to start works on the Gauteng section of the R573 project in 2024, which will translate into jobs for locals, skills development and training and subcontracting opportunities for black-owned businesses.
  • N2 Ermelo to KwaZulu-Natal border – The N2 between Ermelo and the KwaZulu-Natal border is due for a major upgrade, with five packages already advertised and currently under evaluation. The Panbult Interchange is currently under construction and the N2 between Bloemendal and Piet Retief was recently awarded – to the value of approximately R3.8 billion. All the other phases are earmarked for award later this financial year.
  • R52 upgrade – Construction has also begun on the multi-billion-rand R52 between Rustenburg and Koster in North West. Additionally, good progress has been made on the upgrade of the R510 from the North West/Limpopo border towards Thabazimbi.
  • R21 and N1 sinkholes – Work on the R21 and N1 sinkholes has progressed well. The rehabilitation of the R21 between Pomona Road and Olifantsfontein Interchange continues to gather momentum. Plans are underway to advertise additional tenders for periodic maintenance of the entire GFIP sections covering the N1, N3 and N12 in Gauteng.
  • N2 Cape Town upgrade – A portion of the N2 between Swartklip Interchange and Baden Powell Interchange, approximately 12km in length adjacent to Khayelitsha and Mfuleni in the City of Cape Town, is currently under design. The project entails the upgrading from a four (4) lane to six (6) /eight (8) lane divided highway, four (4) major interchanges upgrades, and pedestrian safety infrastructure. A 6km portion of the N2 needs to be raised due to increased water levels. The project will make a significant contribution to road safety by formalising pedestrian and public transport facilities within the N2 road reserve, including the replacement of the old street lighting. Channelising pedestrians to safe crossing points is key to the safety improvements. The detailed design is being finalised. The project cost estimate is approximately R2 billion, and the construction tender is to be advertised in November 2024.
  • N1, Old Oak to Koelenhof – The detailed design has been completed for the N1 improvements for about 13, between Old Oak and Koelenhof interchanges, with an estimated cost of over R3 billion. The project entails upgrading from four (4) lanes to six (6)/eight (8) lane divided highway, five (5) major interchange upgrades and pedestrian safety infrastructure, including street lighting over the entire length. SANRAL is in final preparations to go the market for this project.
  • N7 upgrade – Work on the upgrades to the N7 in the Western Region is ongoing and has already seen more than R3.5 billion invested into the economy, with more than 40km of dual carriageway freeway constructed, eight interchanges constructed and nearly R1 billion spent on targeted enterprises over the last 10 years. The current R600 million upgrades between Malmesbury and Moorreesburg is due for completion in early 2025. There are other periodic contracts on the go and more recently awarded.
  • Huguenot Tunnel – The tunnel has been operating for more than 36 years, allowing more than 112 million vehicles to pass through safely. In keeping with international safety standards as well as meeting the mobility demands of the significantly increased traffic volumes that come with urban development, SANRAL is upgrading the tunnel. Extensive improvements have been made to the existing tunnel (South Bore) in the last 24 months, which include upgrades to the tunnel lighting, ventilation and fire detection systems. The upgrade of the second tunnel (North Bore) is overdue and the final detailed design has recently been completed. SANRAL is preparing to go to the market shortly on this five-year construction contract. The project will cost approximately R4 billion to complete.
  • N2/N3 upgrades – The R50 billion upgrade to the N2 and N3 freeways in KwaZulu-Natal is well underway, with significant progress on the KwaMashu Interchange on the N2, the EB Cloete Interchange linking the N2 and N3, as well as on the N3 between Durban and Pietermaritzburg. The R5 billion upgrade to the EB Cloete Interchange (Spaghetti Junction), joining the N2 and N3 freeways, will increase the capacity of the interchange from the current 20 lanes to 32 lanes in all directions. Upon completion, the upgraded interchange and adjacent N2 and N3 will provide additional lanes that will reduce traffic congestion and delays for the travelling public. On the N3, the R4.5 billion upgrade project between Key Ridge South and Hammarsdale which commenced in May 2023, will alleviate traffic congestion and significantly improve safety in the area. On the N2, the R1.2 billion KwaMashu Interchange to Umdloti project started in August 2021 and is due for completion in September 2026.

The SANRAL management team, led by the CEO, conducted inspections of the N2WCR and N2/N3 projects in recent weeks and were satisfied with the progress made on these priority projects.

“SANRAL has numerous multi-billion-rand projects underway across the country which ensure that the construction industry is thriving, creating jobs and new opportunities for small, medium and micro enterprises (SMMEs),” said Demana. “SANRAL will continue to use its mandate of developing, financing and maintaining the national road network to improve the lives of all South Africans, one kilometre at a time.”

//Ends