DEPARTMENT: PUBLIC ENTERPRISES
REPUBLIC OF SOUTH AFRICA
NATIONAL ASSEMBLY
QUESTION FOR WRITTEN REPLY
QUESTION NO.: 934
DATE OF PUBLICATION: 21 August 2009
Mr M R Shinn (DA) to ask the Minister of Public Enterprises:
(1) Whether the African West Coast Cable (AWACC) project (details
furnished) is
proceeding; if not, why not; if so, (a) what is the cost and (b) who are
the (i) funders and/or (ii) shareholders;
(2) whether any funding arrangements have been finalised; if not, why not;
if so, (a) what are these arrangements, (b) when will work commence on the
(i) planning and (ii) implementing of the cable and (c) what is the
expected completion time? NW1147E
REPLY
(1)(a-b)(i-ii) The original African West Coast Cable (AWCC) project was
launched by Broadband Infraco as a developmental project in August 2007,
together with 13 other interested parties in the sector, with the objective
of being ready for service by mid 2010. Negotiations commenced on the
Construction and Maintenance Agreement (C&MA) that would govern the ongoing
commercial relationship between the parties after financial closure of the
project. The AWCC C&MA was not concluded in its envisaged form because the
parties could not reach consensus on various commercial principles and
consequently the project was underfunded. The AWCC development project was
therefore suspended in July 2008.
Broadband Infraco and the other major South African telecommunications
operators then investigated new opportunities to cooperate and an MOU was
signed in September 2008 between Broadband Infraco, MTN, Vodacom, Neotel
and Telkom to jointly develop a new undersea cable project called the West
African Cable System (WACS). Governance structures for WACS were
established and the development of the C&MA and Supply Contract for the
WACS project commenced in October 2008.
The commercial principles of participation were negotiated and agreed
between the parties and the C&MA was signed by Angola Telecom, Broadband
Infraco, Cable & Wireless, MTN, Telecom Namibia, Portugal Telecom, Sotelco,
Tata Communications, Telkom SA, Togo Telecom and Vodacom on 8 April 2009.
Broadband Infracoâs investment in WACS will result in it acquiring a 12%
stake in the total capacity of the system.
(2)(a-b)(i-ii)(c) Broadband Infracoâs participation in the project will be
financed through a combination of existing equity and debt funding. Debt
funding is being arranged in the form of a senior debt package from the
Development Bank of Southern Africa.
From a technical perspective, WACS is a high capacity marine cable system
that will link countries in Southern and West Africa and Europe, with at
least 5.1 terabits per second of international bandwidth capacity. Planned
landing points include South Africa, Namibia, Angola, the Democratic
Republic of the Congo, the Republic of Congo, Cameroon, Nigeria, Togo,
Ghana, Côte dâIvoire, Cape Verde, Canary Islands, Portugal and the United
Kingdom. The estimated capital cost of WACS is approximately US$ 660
million.
The supplier for the system was selected by the WACS consortium and a
contract was signed on the 8 April 2009 for the supply, implementation and
commissioning of the cable system with all associated landing points. The
activities for the deep water trunk route survey and desk top study have
commenced and will be completed by mid September 2009. Manufacture of the
marine cable and repeaters is scheduled to start in December 2009.
Implementation of the system is expected to commence in May 2010. The
cable system is expected to be ready for service during the second half of
2011.