Gov’t picks China Roads and Bridges to operate SGR for five years

Gov't picks China Roads and Bridges to operate SGR for five years

The government has picked the Standard Gauge Railway contractor, China Roads and Bridges Corporation (CRBC) to operate the line for a five year period.

This comes even after Kenya Railways issued an international tender seeking an adviser to identify an operator for the new railway line.

Transport Cabinet Secretary James Macharia said the move was agreed on by the partner states of the Northern Corridor Transit and Transport Coordination, in an effort of ensuring accountability for the Ksh 420 billion project.

“We’d like the person who has done them (SGR) to test them to make sure we don’t have a train flipping because the contractor did a shoddy job,” Mr Macharia said.

The government is yet to formalize the agreement but it is expected to be in place by the time the project is completed.

Mr Macharia said 80 percent of the construction of the SGR line was complete with CRBC expected to begin tests on the new line in December before commissioning the line in June 2017.

This will be a first for the country where a contractor is given preferential treatment to operate and potentially recoup its investment. The Chinese government financed 80 percent of the project through a Ksh 294.3 billion loan from the China Exim Bank.

Part of the anticipated benefits of the standard gauge railway includes slashing of transport costs by nearly 60 percent. The freight costs will fall to $0.08 per tonne/Km from USD0.2 per tonne/ Km and average trip from Mombasa to Nairobi using train will average four hours.

The government is considering shifting a bulk of the cargo being transported from the port of Mombasa to the new railway line.

Kenya Railways has already sent orders for 56 trains that will operate the route by next year. They include eight shanting, five passengers and 43 mainline locomotives. Also 1,620 wagons have been ordered.

One train will be able to transport 216 20-feet containers in a journey which translates to about 108 trucks on the road.

Kenya Railways Managing Director Atanas Maina allayed fears that SGR would cripple trucking industry as there will be enough cargo to sustain both sectors.

“Of the 27 million cargos annually, we will eventually be able to transport 22 million cargos per year. The trucks will still have their market share as they only have a capacity to carry 1.2 million tonnes. There will be enough business for all of us,” Mr Maina said.

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Story By Michael Karanja
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