the russian transport infrastructure -...

Innovative Logistics Consultancy �

Solutions for Your Success

The Russian Transport InfrastructureLogistical Considerations

Moscow, 31st of March 2009

© TransCare AG 2

The Russian Transport Infrastructure � Logistical Considerations

1. Introduction

2. Key transport bottlenecks and how to tackle them

3. Rail network challenges

4. Analysis of port costs and challenges for optimal efficiency

5. Optimization of rail transport concepts

Content

3© TransCare AG

TransCare Facts

1. Introduction

Profile: Management consultancy forlogistics and transportation

Foundation: 1993

Specialisation: Raising efficiency in logistics process chains

1) Rail transport

2) Supply chain management

3) Process-oriented infrastructure planning

Approach: Pragmatic concepts delivering tangible economic rewards

Facts: > 1.000 successful projects with more than 250 customers

Team: 60 international experts in Germany, Russia, India and Spain

4© TransCare AG

TransCare References - Abstract

1. Introduction

Industries PortsLogisticsProviders

5© TransCare AG

Full Cost Structures for Steam Coal Deliveries to ARA 2007in US dollars/t

1. Introduction

With an average share of logistics costs of 63.5 % coal business is logistics business

0

20

40

60

80

100

Australia China Indonesia Russia S.Africa Colombia

54 % 76 % 64 % 66 % 59 % 63 %

Source: Global Insight, London 2008

x % Share logistics costs

Other mine costs

Wages

Royalties / Levies

Profit & ROC

Port & Rail Costs

Average Sea Freight Rates

© TransCare AG 6


1. Introduction





Content

7© TransCare AG

Expected growth rates of 3 % in coal exports from Russia lead tochallenges in the whole supply chain.

Source: German Coal Importer Federation, Annual report 2008

Overview of Coal Transport Flows in Russia 2007


Total mined coal: 314 mln t

Total exported coal: 93 mln t

Exported via ports: 78 mln t

30%

11%

Far East Basin19 mln t

North West Basin43 mln t

South Basin16 mln t

Exported overland5 mln t

Exported to CIS10 mln t

55%

21%

24%

5%

84%

Coal mining regions

Transport nodes Main Coal Ports

8© TransCare AG

Approaches to Handle Forecasted Volumes


An integrated solution using several approaches leads to logistics excellence

Port Infrastructure Rail Infrastructure Rolling Stock

� Layout of port facilities

� Floating cranes

� Conveyor systems

� Axle load

� Passing lanes

� New lines

� Net-to-tare ratio

� (Un-)/loading techniques

© TransCare AG 9


1. Introduction





Content

10© TransCare AG

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg

Krasnoyarsk Khabarovsk

Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Russian Railways Network and Investment Activities


Russian Railways infrastructure investment program amounts to US $55,5 bln in period 2008-2030.

Coal mining regions

Transport nodes Main Coal Ports

Investment focus

11© TransCare AG

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg


Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Focus on Investment Activities I


I Hinterland connection Novorossysk/Tuapse

� New rail lines

� Modernization of existing rail lines

II Hinterland connection Ust-Luga

� New rail connection Ust-Luga / St. Petersburg

III Connectivity North Ural to Northwest ports

� New rail connection N. Urengoy - Vorkuta

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg


Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg


Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Back-up

12© TransCare AG

Focus on Investment Activities II


IV Capacity extension in Siberia

� Modernization of existing rail lines

� Extension of existing rail lines

V Hinterland connection Vanino

� Construction of new rail line and tunnelplanned (Old route: 37,6 km, new route: 27 km)

� Capacity extension Kmsomolsk-na-Amure - Vanino

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg


Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Novorossiysk

Rostov/D.

Murmansk

St.Petersburg


Vanino

Vostochny

Chita

Novosibirsk

Ekaterinb.

Archangelsk

VorkutaN. Urengoy

U-Ude

Moscow

Kazakhstan

Western

Mongolia

Tuapse

UA Ports

Tyumen

Omsk

Ust Luga

Komsomolsk Amur

Back-up

13© TransCare AG

Comparison of Rail Infrastructure Investments


0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

0

100

200

300

400

500

600

700

Total annual investments[US $ mln]

Investments per track-km[US $ ths]

Source: German transport infrastructure investment program (BVWP), Spanish transport infrastructureinvestment program (PEIT), OAO RZD Investment Program 2008-2030

Planned rail infrastructure investments are insufficient compared to other countries

Germany Spain RussiaTotal annual investment Investment per track-km

© TransCare AG 14


1. Introduction





Content

15© TransCare AG 15

Overview: Port Handling Costs for Coal Worldwidein US $/t


The worldwide benchmark for coal loading/unloading is about 2-3 US dollars/t, Russian ports are far above

Abbot Point [2,10]DalrympleBay [2,20]

Gladstone [2,50]Kooragang [2,40]

Black SeaYuzhny [3,00]Tuapse [4,00]

Tanah Bara [1,40]

Balikpapan [1,90]

Puerto Bolivar [2,80]

Vostochny [10,50]

Murmansk [4,50]

Vanino [6,50]

Baltic SeaVentspils [9,40]*Riga [8,00]*Tallin [6,50]*St.Petersburg [5,20]Vysotsk [5,20]Ust-Luga [6,5]

Main Coal Ports

Richards Bay [2,00]

Paradeep [4,40]

Ennore [4,80]

Rotterdam [2,00]

*including rail transit

16© TransCare AG 16

Overview: Coal Handling Volumes 2007 Worldwidein mln t


Russian coal ports are not among the international top players

Abbot Point [12]DalrympleBay [56]

Gladstone [64]Kooragang [40]

Black SeaYuzhny [10]Tuapse [3,5]

Tanah Bara [20]

Balikpapan [5]

Puerto Bolivar [35]

Vostochny [14,5]

Murmansk [12,5]

Vanino [0,7]

Baltic SeaVentspils [5,5]Riga [10,4]Tallin [3,7]St.Petersburg [2,3]Vysotsk [5]Ust-Luga [6,4]

Main Coal Ports

Richards Bay [72]

Paradeep [20]

Ennore [16]

Rotterdam [25]

17© TransCare AG

Correlation Volume/Handling Costs


Russian handling costs cannot be justified by economies of scale

0

10

20

30

40

50

60

70

80

Abbot

Point

Dalrym

ple B

ay

Koora

gang

Gladsto

ne

Parade

ep

Ennor

e

Richar

ds B

ay

Tanah

Bara

Balikp

apan

Puerto

Boli

var

Rotterd

am

Vanino

Vosto

chny

Mur

man

sk

Vysot

sk

St. Peter

sburg

Ust Lu

ga

Tuapse

Yuzhny

0

2

4

6

8

10

12

Australia India Other Russia/Ukraine

NW BasinFE Basin S Basin

Volume [mln t] Handling costs[US $/t]

cost-price corridor

18© TransCare AG

EMO operates Europe�s main bulk iron ore and coal terminal in the port of Rotterdam.

� 35 mln t iron ore and coal handled per year

� 1.280m quays

� 23m draught

� 4 unloading bridges (160.000 t/day)

� 1 barge loading station (100.000 t/day)

� 2 train loading stations

� 1 cleaning and screening station (3.000 t/day)

� 160 Ha of ground storage space (6 mln t)

� Operations 24 hours a day, 360 days a year

Best Practice: EMO Rotterdam


EMO is supposed to be the most efficient bulk terminal in Europe

19© TransCare AG

� Loading

Track hoppers for wagon unloading

Stackers

Re-claimers

Ship loaders

� Unloading Conveyor system

Shore-based gantry type grabs

Mobile hoppers

Mechanized wagon loading equipment

19

State-of-the-Art Techniques


Mechanized coal handling leads to increased productivity and decreases spillage of coal

© TransCare AG 20


1. Introduction





Content

21© TransCare AG

Benchmarking


Germany Poland Russia India Australia*

Max. trainlength [m]

Averagespeed [km/h]

The technical framework for rail transport in Russia is quite good, but there are problems in operations

Max. Axleload [t]

700 600 1.050 680 2.500

35-40 30-35 10-15 20-25 n.a.

22,5 20 22,5 22,5 40

*Fortescue Metals Group railway line in Pilbara region

22© TransCare AG

� Construction of dedicated railway line for260km iron ore transport in the Pilbara region

Investment: 1,6 bln US dollars

Axle load: 40t

3 passing loops (each 3km length)

Eight bridges

� Optimized operations

2.5km long trains with 240 wagons (23t tare weight,137t carrying capacity)

2 GE Dash 9-4400CW diesel locomotives

Trainloads of ca. 30.000 t

Train unloading with a twin-cell rotary dumper (80 wagons per hour)

Best Practice: Fortescue Metals Group


Fortescue Metals Group sets the benchmark for further dedicated lines by integrating all necessary components for efficient railtransport

23© TransCare AG

Source: OAO RZD Tariff - average (2009)

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25

30

35

40

45

0 1.000 2.000 3.000 4.000 5.000

Distance [km]

Rail Tariffs for Main Bulk Transport Flows*in US $/t


Macro-level analysis indicates that Russian rail tariffs are much higher than European ones, but still below Indian tariffs

India

Eastern Europe

Russia

* Transport Flows with >500.000 t/year (Iron ore, coal, cement)

Source: TransCare Projects

Western Europe

24© TransCare AG

0

2

4

6

8

10

12

14

0 200 400 600 800 1.000

Distance [km]

Rail Tariffs for Main Bulk Transport Flows*in US dollars/t


Russian rail tariffs are ca. US $2/t higher than in Eastern Europe and US $ 4/t than in Western Europe

* Transport Flows with >500.000 t/year (Iron ore, coal, cement)

Source: TransCare Projects

Eastern Europe

Russia

Western Europe

25© TransCare AG

Train Length and Weight


Max. train weight [t]


Upgradelocomotive

Expand train length

4.500

1.050

1

3

2

Increaseaxle load

Restrictions

1 Limited by loco power, brakes, etc.

2 Limited by infra-structure (signaling, passing lanes, etc.)

3 Limited by axle load

useable non-useable optimization approach

Optimization of train length and weight requires high investments and cannot be done in short term period

26© TransCare AG

Capacity Utilization


Max. train weight [t]


0 %

20 %

40 %

60 %

80 %

100 %

0 % 20 % 40 % 60 % 80 % 100 %

Optimization of capacity utilization can be done without any or with small investments

27© TransCare AG

Comparison Railcars


Tare weight[t]

Max. GrossRail Load [t]

Auto Flood III

Max. CarryingCapacity [t]

Net-to-Tareratio

Length [m]

Max. AxleLoad [t]

Height [m]

22,4

129,8

107,4

4,8

16,2

32,45

4,06

25,5

90

64,5

2,52

13,29

22,5

4,0

Falns

24,0

100

76

3,17

12,1

25,0

3,95

Poluwagon

28© TransCare AG


Overview State-of-the-Art Railcars

Aluminium Quad Hopper BethGon II Tripple Hopper

Auto Flood II Auto Flood III

Source: Freightcar America

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