1. Gauteng Rapid Rail Network Extensions
Gautrain as a Public Private Partnership within a Capital Project Appraisal Framework
15 November 2016

2. Gautrain as a PPP The Gautrain is one of the largest PPPs in Africa
80km of high speed rail in Gauteng Province
Concession Agreement is between Gauteng and a Concessionaire for 19 ½ years
Design
Build and Integrate
Operate
Transfer
R28 billion capital cost (approx. USD3,5 bn in 2006)
Ex Post economic appraisal showed significant social and economic benefits for the project

3. Gautrain as a PPP (2) Now in 6th year of operation
Feasibility study to extend the rail network in the Province by some 140km using a PPP model
Deliver a world class and sustainable transport system that supports Gauteng’s economic, social , cultural and environmental goals
Integration with systems and development initiatives
Service non serviced areas in the province
Service excellence
Socio economic development
Job creation

4. Gautrain- a project with Multiple Objectives
The GRRIN will promote
Public Transport
SMME & BBBEE Development
Tourism
Business development
The project stimulates
Economic growth
Local & Foreign Investment
New development
Job creation
Design to
Restructure urban areas
Reduce travel distances, time and cost
Improve GCR sustainability

5. Two Passenger Rail Operators in Gauteng
Metrorail/PRASA
Gautrain

6. Extensions: All Phases
MAMELODI
LEGEND
HATFIELD
HAZELDEAN
North – South Commuter
TSHWANE EAST
East – West Commuter
PRETORIA
IRENE
Airport
CENTURION
Phase 3- 5
SAMRAND
Metrorail
OLIEVENHOUTSBOSCH
MIDRAND
RHODESFIELD
SUNNINGHILL
LANSERIA
FOURWAYS
O.R. TAMBO
CRADLE
COSMO
MODDERFONTEIN
SANDTON
MARLBORO
LITTLE FALLS
RANDBURG
EAST RAND MALL
ROSEBANK
SANDTON 2
ROODEPOORT
BOKSBURG
JABULANI
PARK

7. Problem Statement
South Africa has a strong PPP regulatory Framework embedded in Treasury Regulations
Central PPP Unit in National Treasury provides support
Multi –stage approval process
Feasibility Study (Treasury Approval I)
Procurement Documents (Treasury Approval IIA)
Appointment of Preferred Bidder(Treasury Approval IIB)
Contract signing(Treasury Approval III)

9. Problem Statement(2) A PPP will only be approved if it is:
Affordable
Value for Money
Transfers substantial risk to the Private Party
Works well for simple infrastructure projects
Gautrain very complex and very high capital cost and significant long term fiscal risk
Needs a different framework for approval as a large capital investment project
Needs a modified feasibility study

10. The PPP Feasibility study process

11. Feasibility Study Components
18 month process
Extensive analysis of route and solutions options
Station node studies
Investment Grade Demand and Revenue Study
Comprehensive environmental studies
Comprehensive Economic appraisal in accordance with Treasury’s Capital Project Appraisal guidance
Funding options study to identify long term funding streams

12. Credible Project Partners
Registered Project with Treasury as a possible PPP
Registered it as a Strategic Integrated Project under the National Development Plan
Project Support Agreement with DBSA
DFI support for independent reviews of all feasibility study components (peer review with formal sign-off)
KfW funded independent study of funding options (e.g. Land Value Capture)

13. Contractual Structure: Operator PPP
Gauteng Provincial Government/GMA
Rolling Stock
Operator - PPP
Civils
Construct
Track
Construct E&M Mechanical
Various Civil EPC
Operations
Maintenance

14. Extensions : CBA Staging Analysis

15. Questions
William Dachs
COO
Gautrain Management Agency