South African energy official, Karen Breytenbach, said that the country will invest $3.7b at the ports of Richards Bay and Coega to build infrastructure for a gas-to-power program aimed at easing the country’s dependence on coal, Bloomberg reported.
The project will entail the construction of South Africa’s first liquefied natural gas (LNG) import terminal, gas-fired power plants, storage facilities and transmission pipelines. Breytenbach added that the project will consume 1.6mt/y of gas imports and the ports each need $1.84b, according to Reuters. She concluded that South Africa will use vessels offshore to receive, convert and store the LNG it imports, avoiding the risk of gas plants becoming “stranded assets” if the country starts producing its own gas.
A power plant at Richards Bay will generate 2,000MW and another at the Coega industrial development zone will produce 1,000MW. The government will seek bidders to manage the projects, underpinned by a 20-year power-purchase agreement with state utility Eskom Holdings SOC Ltd. Bidders will be pre-qualified in April after making submissions in February. The final request for proposals is expected in August 2018.
This comes as the South African Energy Minister, Tina Joemat-Pettersson, had announced that the country will put out requests for proposals on a nuclear procurement process at the end of September, with a production capacity of 9,600 MW.