Airport move in spotlight
WITHOUT making commercial use of the land surrounding the proposed new regional airport site, there is no business sense in relocating the Richards Bay airport from its existing site.
This according to an Exco presentation last week by the company tasked with undertaking the pre-feasibility study for the relocation to the earmarked new site west of the N2, between Empangeni and eNseleni Nature Reserve.
However, commercially utilising the land surrounding the airport structure would be ‘cause for good news, but must be cautious’.
Risks associated with the identified 3 000ha site include a proposed wind farm as a competing project, powerline infrastructure which can be mitigated but is not ideal, and market demand uncertainty.
Factors contributing to the need to relocate the airport include ticket pricing, convenience and accessibility, safety and security, reliability and technical issues.
A projected pessimistic scenario for remaining at the existing site would see the current passenger arrivals figure of 30 300 annually or 29% market share, increase to 46 000 or 37% market share.
A projected optimistic scenario would see passenger arrivals increase to 58 500 or 45% market share.
With 2022 as the key date for the possible opening of the new airport, projected arrivals figures are 80 000 annually, increasing to 140 000 by 2041.
This is double the number of arrivals at Pietermaritzburg airport.
A number of unknown air traffic factors must be taken into account, including the possible closure of Durban’s Virginia airport and the opening of Mkhuze airport.
A total of 533ha would be required for the airport, including runway, terminal building and commercial and retail zone.
The cost of acquiring this land is estimated to be between R85-million and R105-million.
Development costs are estimated at R500-million, while an estimated R30 to R50-million would be generated from the disposal of the existing site. Projected revenues are between R12and R15-million annually by 2022, and between R30- and R52-million by 2041.
Total operating costs would be between R15- and R18-million annually by 2022 and R30- to R45 million by 2041.
According to the optimistic scenario, the new airport would start to turn a profit only from 2048.
However, catalytic benefits would be enjoyed by rolling out commercial land usage and residential units on land surrounding the new airport.
This would cause a net profit value of R170- to R438-million annually, but it was determined there is a strong need for additional market research for such usage.
No alternative sites have been identified and when it was suggested the municipality look beyond its boundaries in identifying a potential site, Mayor Mdu Mhlongo said that was a ‘nonstarter because the airport would become a provincially or district co-ordinated entity’.
Councillor Mdu Zikhali requested a thorough investigation into graves on the identified site.
Councillor Louis Fourie said the DA opposed the new airport project.
Mayor Mhlongo said he is inclined to go with the optimistic scenario.
The decision was taken for the Municipal Manager to engage with farmers on the identified land, regarding the feasibility of land expropriation.
Cautious optimism as options are weighed
Studies are ongoing regarding the relocation of Richards Bay airport