Consortium delays holding back $510m undersea cable project
A delay in finalising the commercial and legal agreements for the consortium that plans to participate in the $510-million African West Coast Cable (AWCC) means that financial closure on the project is now unlikely to be achieved by mid-July as first planned, and that the project will, thus, only come into service in the latter half of 2010, after the completion of the FIFA World Cup.
The 13 000-km AWCC, which is a Presidential lead initiative for the South African government, would involve the deployment of a 3 840-gigabits-a-second ‘super cable' terminating in London, but incorporating branching units to at least ten countries along the West Coast of the African continent.
But State-owned Broadband Infraco, which is leading the initiative, and which had initially targeted July as the latest date for achieving financial close, has admitted to Engineering News that the initial schedule could not be met.
Infraco director and adviser to the Department of Public Enterprises on the issue of broadband infrastructure Cornelis Groesbeek explains that the conclusion of the consortium agreement was one of two key requirements for achieving financial close, the other being conclusion of the commercial supply process, which has reportedly been achieved.
"We have selected a preferred supplier. The delay is in the conclusion of the consortium agreements, but these are progressing well," Groesbeek assures, noting that there weekly review meetings are now being held to finalise the agreements.
There are reportedly 14 signatories to the process, but Groesbeek says that a decision has also been made to release the names of the participants only on financial close.
"It is difficult to say how long it will take to close the legal agreement between the parties, but we are weeks away, not months," he avers.
He adds that Infraco is currently finalising the contract terms and conditions for the manufacture and deployment of the cable with a preferred supplier, but he says the name of the supplier will only be made public "once the contract has been signed".
"As part of the procurement process followed, terms and conditions of the contract were negotiated, which includes firm timescales for manufacturing, deployment and ready-for-service dates," he explains, reporting that it will take "roughly 27 months" from financial close to commissioning.
This implies a "ready for service date" in the latter half of 2010, after the completion of the FIFA World Cup.
"The 2010 traffic will be carried on the upgraded SAT-3 system," Groesbeek asserts.
However, he reveals that "2010 contingency plans" have been designed into the AWCC project schedule should such plans become necessary.
"In the event that either Infraco or any one of the private-sector participants need to carry 2010 World Cup traffic on the AWCC, we will land the cable in Portugal from the Northern Branching unit ahead of the World Cup and then complete the last section of the system up to the UK after the event," he concludes.
