An agreement has been signed opening the way for the launch on January 1 of the much-delayed 25-year private sector participation (PSP) deal between International Container Terminal Services (ICTSI), of the Philippines, and Transnet at the Durban Container Terminal (DCT) Pier 2.

The agreement was the subject of a long-running legal dispute launched by APM Terminals, which is part of the AP Moller-Maersk Group, following Transnet’s 2023 decision to select ICTSI as the preferred bidder for a partnership with Transnet Port Terminals at the country’s largest container terminal.

In October this year, the KwaZulu-Natal High Court dismissed the APM Terminals application on the basis that it had unreasonably delayed its launching of a review application of the Transnet decision.

Transnet will continue to hold a majority shareholding in a new special purpose vehicle, or Newco, while ICTSI will be responsible for the operation of the terminal. It has been reported that ICTSI will invest about R11-billion into the terminal.

In a joint statement, Transnet and ICTSI said new equipment to be introduced in line with the agreement would raise DCT Pier 2’s capacity from 2-million to 2.8-million twenty-foot equivalent units, improve hourly gross crane moves from 18 to 28, and increase ship working hours from 60 to 120.

ICTSI senior VP Hans-Ole Madsen described DCT Pier 2 as a strategic asset for South Africa, and said ICTSI would bring global expertise and technology to ensure it became a world-class terminal that benefitted the region.

Transnet Group CEO Michelle Phillips said she expected the partnership to further propel the terminal to its full potential, noting a recent improvement in its performance.

She also stressed the importance of PSP transactions to the group’s strategy to modernise, expand and improve its assets.

“Private sector participation in ports has the potential to positively influence efficiencies, export processes and global competitiveness.”