Cost comparison SGR Kenya vs SGR Tanzania

Geza Ulole

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Geza Ulole

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Tanzania secures $7.6 billion financing deal from Chinese lender to build new railway

President John Magufuli with China Exim Bank president Liu Liang after holding talks at Chamwino State Lodge in Dodoma this week. PHOTO | COURTESY

In Summary

  • Dar es Salaam is positioning itself as a regional hub, upgrading its port to attract more business from its neighbouring landlocked countries.
  • The EAC railways master plan incorporates the standard gauge railway’s Northern and Central Corridors, which are both commercially viable for landlocked countries in the region as they give them strategic access to the ports of Mombasa and Dar es Salaam.
  • The Northern Corridor Integration Projects championed by Rwanda, Kenya and Uganda spearheaded the establishment of a railway link from Mombasa to Kigali.
  • In June 2013, a Northern Corridor Integration Projects Heads of State Summit held in Kampala put in place mechanisms for fast-tracking the development of the SGR.


Tanzania has secured a $7.6 billion loan from China’s Export-Import Bank (Exim) for the construction of a railway line that will link it with Burundi, Rwanda and Democratic Republic of Congo.

President John Magufuli secured the concessional loan after meeting with the Exim Bank’s president Liu Liang.

President Magufuli, while announcing the funding, alluded to a preferential deal without providing details.

Oil and gas discoveries have turned Tanzania into an exploration hotspot, but the country’s transport infrastructure has suffered from decades of under investment. The country is also positioning itself as a regional hub, upgrading its port to attract more business from its regional landlocked neighbours.

According to Mr Liu, China Exim Bank will offer Tanzania technical support.

READ: China Exim sets terms for financing Uganda’s SGR

ALSO READ: Rwanda looks to Tanzania for rail transport as Uganda falters on SGR

Last year, Tanzania announced that it had awarded rail contracts to a consortium of Chinese firms led by China Railway Materials (CRM), which included the standard gauge rail project.

The Exim Bank is also financing a $1.2 billion, 532km natural gas pipeline in Tanzania.

On Wednesday last week, Finance and Planning Minister Dr Philip Mpango after a meeting with Dr Alberic Kacou, African Development Bank vice-president for human resources and corporate services, announced that Tanzania had secured a further $200 million loan from the AfDB to finance transport infrastructure projects.

“We will use some of this funds towards the construction of the SGR project to transform the country’s infrastructure,” Dr Mpango said.

In an interview with Bloomberg, Gerson Msigwa, a spokesman for Tanzania’s presidency, said the construction will start by July next year. Before then, Tanzania and Exim Bank China will be expected to have finalise technical issues on the contract and sign the financing deal for the 2,190km project.

Tanzania Transport Minister Samuel Sitta said the SGR will have a main line that will connect the port city of Dar es Salaam to Rwanda and Burundi, with additional branch lines running within the country.

“We expect to have two offshoots: One of them to Mwanza, which will open up the lakeside port city and link it with Uganda, while the second one will link to the coal, iron ore and soda ash mining areas in the south. Through this, we expect an increase in cargo on this route,” Mr Sitta said, adding that will be at an additional cost of $6.6 billion.

Already, Tanzania has signed contracts with China Railway No 2 Engineering Group to build a rail link between the southern port of Mtwara, which is rich in coal, iron ore and natural gas. The contract will see China Railway No 2 Engineering Group provide 10 per cent of the funding with the rest provided by the government.

Kenya is also constructing a $3.27 billion 609km new standard gauge railway line between Mombasa and Nairobi to boost the movement of cargo from the port.

However, queries have been raised over the economic viability of SGR, after key landlocked states indicated their intention to connect to the Indian Ocean through Tanzania.


The issue of cost is also bound to arise now that Tanzania’s SGR is four times longer than Kenya’s but only two times as expensive.

In a previous interview with The EastAfrican, Kenya Railways managing director Atanas Maina said that the cost of the Kenyan SGR was high because of the design adopted, which will see the train maintain an average speed of 80 kilometres irrespective of the terrain.

“We have built bridges, and raised the track in areas where we would have had corners to achieve the average speed we expect the wagons to travel at. This has increased the costs immensely as compared with the neighbouring Ethiopia and Tanzania SGER designs that haven’t taken this into account,” Mr Maina said.

Recently, a confidential World Bank report cast doubt on the region’s push for the SGR projects, saying they would only be viable with increases in cargo of between 20 tonnes and 55 million tonnes per year.

The report done by the Africa transport unit at the World Bank titled The Economics of Rail Gauge in the East Africa Community showed that the volumes of the forecasts undertaken for the EAC railway master plan and central line in Tanzania, are unattainable over the medium to longer term.

“Based on these assumptions, there is no economic or financial case for standard gauge in the EAC area at this time. A refurbished meter gauge network would appear to be the most appropriate option in economic and financial terms, and could easily accommodate forecast traffic up to 2030, with lower investment requirements,” the report concludes.

The World Bank team highlighted the rehabilitation of the existing railway network as the best alternative, which would allow a phased approach to the regions development, consistent with current and projected demand and the financing envelope available.

The SGR alternative, which the regional governments chose, involves the construction of a standard gauge railway on a new right of way, an option the World Bank team said required additional investment in land acquisition and structures, and new right-of-way construction.

“This alternative predicates axle loads in the order of 25 tons per axles and a maximum operating speed of up to 120 km per hour. Again, based on these assumptions, the estimated maximum carrying capacity of the current network would exceed 60 million tonnes per year. The estimated investment cost per km will be $ 3.25 million,” the report said.

From the estimates provided, the Tanzanian new railway line will cost an average of $3.4 million per kilometre.

MY TAKE

It is time now to look at the cost of the two rails as we know cost of construction is very important for prospect of any infrastructure! i welcome bright minds to contribute and not some propaganda in here!


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Kafrican

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To the naysayers ambao walikiri wakenya hawatawai take over

Training of teachers, sasa hadi walimu watakao fundisha future SGR engeneers wako sawa.. Wachina wametufundisha kila kitu practically , hadi work ethic/culture, Lets hope ule uzembe ambao tumezoea kuuona kwa wafanyikazi wa serekali hatutauona kwa SGR wachina wakiondoka.
















Train Simulator, A serious investment..... This is the way to go, with a simulator you can safely practice all kinds of scenarios, that you cannot do on the real thing.




Ultrasonic scnanning practice
 
Mkikuyu- Akili timamu

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Mkikuyu- Akili timamu

Mkikuyu- Akili timamu

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To the naysayers ambao walikiri wakenya hawatawai take over

Training of teachers, sasa hadi walimu watakao fundisha future SGR engeneers wako sawa.. Wachina wametufundisha kila kitu practically , hadi work ethic/culture, Lets hope ule uzembe ambao tumezoea kuuona kwa wafanyikazi wa serekali hatutauona kwa SGR wachina wakiondoka.
















Train Simulator, A serious investment..... This is the way to go, with a simulator you can safely practice all kinds of scenarios, that you cannot do on the real thing.




Ultrasonic scnanning practice
10 years locked in contract with China to operate. Kuendesha treni ya diesel ni simple kuliko hata Lorry ya 26 wheels.
Reli yenyewe ni simple jointed, repair ni kufungua tu bolt sio kama Tz lazima ukate kwanza na umeme ama thermite
 
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ndughuri msuya

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10 years locked in contract with China to operate. Kuendesha treni ya diesel ni simple kuliko hata Lorry ya 26 wheels.
Reli yenyewe ni simple jointed, repair ni kufungua tu bolt sio kama Tz lazima ukate kwanza na umeme ama thermite
Hao wanaofundishwa watastaafu bado mchina anaendesha mkataba 😀😀
 
komora096

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komora096

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Vp geza ulole...walimu wenu wako wapi
10 years locked in contract with China to operate. Kuendesha treni ya diesel ni simple kuliko hata Lorry ya 26 wheels.
Reli yenyewe ni simple jointed, repair ni kufungua tu bolt sio kama Tz lazima ukate kwanza na umeme ama thermite
 
Kafrican

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10 years locked in contract with China to operate. Kuendesha treni ya diesel ni simple kuliko hata Lorry ya 26 wheels.
Reli yenyewe ni simple jointed, repair ni kufungua tu bolt sio kama Tz lazima ukate kwanza na umeme ama thermite
And in those 10 years include the first 5 years - training the Kenyans everything from bottom-up. The first year it was 80% Kenyan workforce now we at 95% Kenyan workforce . Ripoti ya KRA inalenga 98% workforce by next year 2020, alafu wachina wakiisha, kutakua na observation period kupima vile wakenya wanamanage SGR, contract iliisha, the same Chinese but Kenyan run company itabaki vilevile lakini itageuka na kua ya kikenya.... Hapo tunatarajia watakua wamekua real experts wa kila kitu au sivyo management ya SGR itapewa kampuni ya kifaransa kama vile ilikua imepangwa pale mwanzo .

Alafu Kenyan locomotives are not diesel trains, They are diesel-electric trains, That means engine ni generator ya diesel inayo generate umeme alafu umeme ndo unatumika ku drive the axles and the rest of the train ... Yani ukiondoa hio generator na u connect na overhead line ya stima treni itasonga bila shida! So ukiwa we ni dereva wa treni hakuna tofauti ya kama unapeleka electric train au diesel-electric, ndio maana hata hio simulator iko modelled from an electric train simulator kwasababu ziko na the same dashboard and controlles.

Alafu hapo Kwa thermite wielding, Yepi wanatumia mashini spesheli ya kufanya hio kazi, kumaanisha alietumia akili ni mwenye alitengeneza mashini, mtumizi wa mashini hahitaji ujuzi wowote hata awe na IQ ya below average, Bora ajue kuwasha na kuzima mashini na kulenganisha chuma mbili in a straight line, the rest ni mashini ndo itafanya! Dereva wa catapiller ya kubeba mchanga anahitaji ujuzi zaidi kuliko huyo wa ku operate hio mashini ya kuunganisha chuma!
 
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And in those 10 years include the first 5 years - training the Kenyans everything from bottom-up. The first year it was 80% Kenyan workforce now we at 95% Kenyan workforce . Ripoti ya KRA inalenga 98% workforce by next year 2020, alafu wachina wakiisha, kutakua na observation period kupima vile wakenya wanamanage SGR, contract iliisha, the same Chinese but Kenyan run company itabaki vilevile lakini itageuka na kua ya kikenya.... Hapo tunatarajia watakua wamekua real experts wa kila kitu au sivyo management ya SGR itapewa kampuni ya kifaransa kama vile ilikua imepangwa pale mwanzo .
Alafu Kenyan locomotives are not diesel trains, They are diesel-electric trains, That means engine no generator inayo generate umeme alafu umeme ndo unatumika ku drive the axles and the rest of the train ... Yani ukiondoa hio generator na u connect na overhead line ya stima treni itasonga bila shida! So ukiwa we no dereva wa treni hakuna tofauti ya kama unapeleka electric train au diesel-electric, ndio maana hata hio simulator iko modelled from an electric train simulator kwasababu ziko na the same dashboard and controlles.
Alafu hapo Kwa thermite wielding, Yepi wanatumia mashini spesheli ya kufanya hio kazi, kumaanisha alietumia akili ni mwenye alitengeneza mashini, mtumizi wa mashini hahitaji ujuzi wowote hata awe na IQ ya below average, Bora ajue kuwasha na kuzima mashini na kulenganisha China mbili in a straight line, the rest ni machini ndo itafanya!
Quick question Kafrican simulator na rescue cranes ni zetu am a niza operator?..Tafadhali
 
Kafrican

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Quick question Kafrican simulator na rescue cranes ni zetu am a niza operator?..Tafadhali
Hio rescue crane sijaiona huku kwetu, but kama iko, most likely itakua ni ya operator manake yeye ndo ako responsible for maintenance and repair ya track...

Simulator najua ni yetu manake part of the deal na China ilikua ni kwamba watatumia $100m ku transform Railway Training Institute ya Kenya Railways kukua fully fledge teaching center of excellence ambayo kila kitu cha railway engineering kitakua kinafundishwa hapo, itakua hakuna haja ya kutuma mtu yoyote nje ya nchi kusomea railway engineering ..
 
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Hio rescue crane sijaiona huku kwetu, but kama iko, most likely itakua ni ya operator manake yeye ndo ako responsible for maintenance and repair ya track...
Simulator najua ni yetu manake part of the deal na China ilikua ni kwamba watatumia $100m ku transform Railway Training Institute ya Kenya Railways kukua fully fledge teaching center of excellence ambayo kila kitu cha railway engineering kitakua kinafundishwa hapo, itakua hakuna haja ya kutuma mtu yoyote nje ya nchi kusomea railway engineering ..
Crane iko(wanaitaa TELESCOPIC BOOM RECOVERY CRANE) and kwa krc's website wanasema they've TAKEN DELIVERY of lakini haina rangi za Kenya railway hence my doubts. I too think iya wa china..Thanks for the answer.
 
Mkikuyu- Akili timamu

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Mkikuyu- Akili timamu

Mkikuyu- Akili timamu

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And in those 10 years include the first 5 years - training the Kenyans everything from bottom-up. The first year it was 80% Kenyan workforce now we at 95% Kenyan workforce . Ripoti ya KRA inalenga 98% workforce by next year 2020, alafu wachina wakiisha, kutakua na observation period kupima vile wakenya wanamanage SGR, contract iliisha, the same Chinese but Kenyan run company itabaki vilevile lakini itageuka na kua ya kikenya.... Hapo tunatarajia watakua wamekua real experts wa kila kitu au sivyo management ya SGR itapewa kampuni ya kifaransa kama vile ilikua imepangwa pale mwanzo .

Alafu Kenyan locomotives are not diesel trains, They are diesel-electric trains, That means engine ni generator ya diesel inayo generate umeme alafu umeme ndo unatumika ku drive the axles and the rest of the train ... Yani ukiondoa hio generator na u connect na overhead line ya stima treni itasonga bila shida! So ukiwa we ni dereva wa treni hakuna tofauti ya kama unapeleka electric train au diesel-electric, ndio maana hata hio simulator iko modelled from an electric train simulator kwasababu ziko na the same dashboard and controlles.

Alafu hapo Kwa thermite wielding, Yepi wanatumia mashini spesheli ya kufanya hio kazi, kumaanisha alietumia akili ni mwenye alitengeneza mashini, mtumizi wa mashini hahitaji ujuzi wowote hata awe na IQ ya below average, Bora ajue kuwasha na kuzima mashini na kulenganisha chuma mbili in a straight line, the rest ni mashini ndo itafanya! Dereva wa catapiller ya kubeba mchanga anahitaji ujuzi zaidi kuliko huyo wa ku operate hio mashini ya kuunganisha chuma!
1) It makes no sense for china to run the rail for 10 yrs. There is nothing complicated unless ofcourse there is fear of kenyans stealing from the company

2) Welded Rail requires far much more training and experience to repair. That is why you use compicated machines to keep the tension, alingment and gradient. Welding a perfect joint is a skill..whereas bolting fishplates is a low level skill
3) Tanzania will use their own manpower from day 1. Infact they are already in training and repairs on the old rail using Joint welding for their practise is already going on
 
asvptx

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asvptx

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1) It makes no sense for china to run the rail for 10 yrs. There is nothing complicated unless ofcourse there is fear of kenyans stealing from the company

2) Welded Rail requires far much more training and experience to repair. That is why you use compicated machines to keep the tension, alingment and gradient. Welding a perfect joint is a skill..whereas bolting fishplates is a low level skill
3) Tanzania will use their own manpower from day 1. Infact they are already in training and repairs on the old rail using Joint welding for their practise is already going on
What do you mean it makes no sense for the Chinese to run the rail for 10years? How then will they recoup the amount they have invested? This rail project is a BOT undertaking.
 
Mkikuyu- Akili timamu

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Mkikuyu- Akili timamu

Mkikuyu- Akili timamu

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What do you mean it makes no sense for the Chinese to run the rail for 10years? How then will they recoup the amount they have invested? This rail project is a BOT undertaking.
operating a Railway is not rocket science
 
Kafrican

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Kafrican

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1) It makes no sense for china to run the rail for 10 yrs. There is nothing complicated unless ofcourse there is fear of kenyans stealing from the company

2) Welded Rail requires far much more training and experience to repair. That is why you use compicated machines to keep the tension, alingment and gradient. Welding a perfect joint is a skill..whereas bolting fishplates is a low level skill
3) Tanzania will use their own manpower from day 1. Infact they are already in training and repairs on the old rail using Joint welding for their practise is already going on
Bolting fishplatesrequires the same alighnment , gradient as when you doing continuous rail... There is nothing complicated about thermite wielding especially when you are using a machine that automatically controls the temperature, tension, etc

This is Thermite wielding done manually in Sweden, Watch and learn and then you can tell me if you think these guys require a high level of skill .


Animation of what happens inside
 

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