R7bn for Sanral tenders
FOUR GET CONTRACTS FOR N2 WILD COAST AND KZN’S N11 Road projects a welcome boost for SA’s beleaguered construction industry.
The South African National Roads Agency (Sanral) awarded four major construction tenders this week for projects on the new N2 Wild Coast highway in the Eastern Cape and the N11 in KwaZulu-Natal that are collectively worth almost R7 billion.
The contracts will provide a welcome boost to SAs beleaguered construction industry, which has suffered for years from a lack of major tender awards.
Sanral said as much in a statement: “These awards will boost the construction sector and should be seen as part of the broader effort by government to invest in economic infrastructure.”
The tender awards follow Sanral in November last year awarding four contracts valued at R17.4 billion that were cancelled earlier in 2022. The cancellations were because of a material irregularity in the tender process, with a board resolution, made in January 2020, not being implemented in the evaluation of these tenders.
Local JSE-listed construction companies WBHO and Raubex feature prominently in the latest tender awards.
The four contracts awarded:
Construction of the N2 Wild Coast Highway from Msikaba Bridge to Mtentu Bridge in the Eastern Cape, awarded to the WBHO H&I JV. This 54-month
project has a contract value of R2.54 billion.
Rehabilitation of the N2 from Mt Frere to Ngcweleni River in the Eastern Cape, awarded to Rumdel Construction Cape. This 45-month contract has a contract value of R1.2 billion.
Construction of the N2 Wild Coast Highway from Lingeni Intersection to Msikaba Bridge in the Eastern Cape, awarded to the WBHO-Edwin Construction JV. This 45-month project has a contract value of R2.29 billion.
Upgrade of the N11 from the N11/R103 Interchange to Elandslaagte in KwaZulu-Natal, which connects Ladysmith. This R864.8 million tender was awarded to Raubex Construction and is a 39-month project.
Peregrine Capital executive chair David Fraser said it is positive to see these contract awards, particularly as they are significant
contracts, and will start to build momentum in the industry.
Catch up
“Hopefully it tells us that Sanral is going to continue to catch up the [contract award] backlog,” said Fraser.
“They did nothing for so long. First, they have to clear the backlog and second put out the current contracts as well. I hope this isn’t the last [of the awards] and there is a continued pipeline of contact awards,” he said.
Sanral highlighted the benefit of these contract awards to blackowned small, medium and micro enterprises (SMMEs), stating that substantial subcontracting on these four projects is collectively worth R2.1 billion.
It made this statement against the backdrop of the continued disruption of construction sites around the country by business
forums and the so-called construction mafia.
Sanral board chair Themba Mhambi said stakeholder engagement sessions will be prioritised in the affected communities to ensure that local businesses and job seekers have access to relevant information that will enable them to pursue and participate in the economic opportunities flowing from these projects.
“Through the establishment of Project Liaison Committees, we will also ensure fairness and transparency in all the appointments of subcontractors and the engagement of local labour.”
Sanral said 35% of the two Wild Coast highway contracts will be sub-contracted to black-owned SMMEs, exceeding Sanral’s transformation targets.
It added that 30% of the N2 and the N11 contracts will be subcontracted to SMMEs