Stars align for the Dandenong South Intermodal Terminal

Salta and state and federal governments stump up Melbourne container shuttle cash

Stars align for the Dandenong South Intermodal Terminal
The Dandenong South site


Salta Properties and the Victorian government have signed an agreement to jointly fund the Dandenong South Intermodal Terminal.

It has been some 15 years in the making but eastern Melbourne’s container rail shuttle now looks all but inevitable.

Developer Salta first raised the initiative in what seems a different world, back when it was also a logistics firm, and even then a shuttle network was identified in government reports as crucial.

The upgrade will connect to the Port of Melbourne’s (POM's) $125 million on-dock rail project, allowing shuttles to run from Dandenong South directly into the port.

The federal and the Victorian governments will jointly invest $28 million on government-owned land to connect rail to Salta’s site boundary.

Salta will concurrently invest more than $50 million to construct the Dandenong South Intermodal Terminal to be located on Salta’s 180-hectare Nexus Dandenong South Intermodal Estate.

Salta says its additional investment is on top of having already spent in excess of $200 million for land, road, and other infrastructure works, in anticipation of the intermodal terminal.

Nexus Dandenong South hosts major users of freight infrastructure including Woolworths’ $215 million Melbourne South Regional Distribution Centre, Bunnings’ 40,000 square metre regional distribution centre, plus major logistics businesses, Visa Global Logistics and Silk Contract Logistics.

Salta says work will start early in 2021 on what will become Melbourne’s biggest intermodal terminal.

The first phase of the project is expected to take just 24 months from works commencement and will include the laying of 800m of rail track and the development of a working apron providing the terminal a capacity to deliver an initial annual throughput of 100,000 TEU.

"This has been a long-term project, where we set out to work with industry and government to provide the best possible inland port infrastructure to Melbourne’s south east, providing an efficient route to market for both importers and exporters," Salta founding director Sam Tarascio Snr

"Over the past 15 years, Salta has developed plans to increase freight capacity in the outer Melbourne area. Operations at POM are limited by the availability and capacity of trucks to transport freight via road causing serious congestion in and around the POM."

The terminal will eventually have expansive storage facilities for both empty and full containers consisting of 110,000 square metres of hard stand, with the ability for two additional rail spurs within the terminal to service increased demand.

Container Transport Alliance Australia (CTAA) sees the development as a crucial move.

"Salta Properties is a valued CTAA alliance company, and this announcement comes hot on the heels of other major Salta developments, including the 10-year leasing deal with ACFS Port Logistics at the Salta Nexus Altona site, which will also connect to the Port Rail Shuttle Network," CTAA director Neil Chambers notes.

"Container freight demand is strong in the south east of Melbourne, including in Dandenong, Hallam, Lyndhurst, and Cranbourne.

"Yet it’s expensive to access by road transport nowadays due to the high CityLink tolls on the M1 for heavy vehicles and the often congested road network.

"A return trip on the M1 for a heavy vehicle between the Port of Melbourne and the tolling gantry at Toorak Road when travelling to/from Dandenong is over $59. And travel times can vary considerably depending on traffic congestion.

"Many road container transport companies have adopted a depot hub strategy in the south-east to maximise the use of high productivity freight vehicles with up to four TEUs per trip, then spoke from their hubs to customers using side-lifter equipment.

"With the right rail connections to Salta’s Nexus Industrial – Dandenong South estate, and with associated train paths and frequent rail services to/from the port, businesses could benefit from co-location to minimise "last mile" freight movements and take advantage of the rail option.

"There’s some way to go until a viable port rail shuttle service can compete for market share in container movements in metropolitan Melbourne. However, this is definitely a step in the right direction."

Read about the link between Salta and ACFS, here

Governments were quick to hail the project.

"We are backing this vital freight rail connection to support Melbournians through the pandemic and unlock private sector investment and economic growth into the long-term," federal infrastructure and transport minister Michael McCormack says.

"The new spur line will connect the intermodal freight terminal at Dandenong South to the Cranbourne Line.

"As part of the Port Rail Shuttle Network it will help cut the number of trucks on inner Melbourne roads by up to 100,000 each year and support hundreds of jobs during construction and as part of the terminals ongoing operations."

"The focus of our government is getting people in jobs and our industries open and ready for business as we continue to deliver our record 10 year, $100 billion land transport infrastructure pipeline to lay the foundations of a financial bridge to recovery on the other side of Covid-19."

According to Victorian ports and freight minister Melissa Horne, the Port Rail Shuttle Network will help modernise Melbourne’s existing transport networks.  

"This is a massive win for both motorists and industry, as we continue to reduce congestion and make it easier and cheaper for businesses to use rail freight," Horne says.

"We’re making rail freight a more attractive option for businesses, and this investment means containers can be transported by rail the entire way from the Port of Melbourne to Dandenong South.

"It will reduce congestion at the port gate and cut the high cost of the last mile that so often disadvantages containers moved by rail."


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