Energy and chemicals group Sasol has again indicated a desire to participate in South Africa’s upcoming gas-to-power programme, confirming on Monday that it had responded to the Department of Energy’s recent request for information and that it was also considering investment options along the entire gas-to-power “value chain”.
The use of natural gas for electricity generation is a priority for South Africa as the country seeks to address present-day power shortages and rising energy needs, said Energy Minister Tina Joemat-Pettersson.
"I have to bring the gas program online as soon as possible," Joemat-Pettersson said on Monday at a press conference near Pretoria.
South Africa, the most industrialized country in Africa, this year asked for industry opinions about its proposed Gas-to-Power program to procure 3,126 megawatts of gas-fired power generation. The study attracted a lot of interest, she said. Attention has shifted to the region with recent natural gas discoveries off neighboring Mozambique that are estimated to be enough to make it the third-largest supplier of gas chilled to liquid for shipment.
With the country importing 77% of its natural gas requirements through a pipeline from Mozambique and shale gas estimates in the Karoo being as high as 390 tcf, the Department of Trade and Industry (DTI) indicates in the Ipap 2014/15 – 2016/17 that these estimates present substantial investment opportunities for natural-gas investors across the value chain.
The construction of a 100 MW natural gas-fired power station at Ressano Garcia is progressing well, with the first of 13 power generation sets having arrived at the Gigawatt Park site on April 15. Print Send to Friend 0 0 South African investment group and majority shareholder in the project Gigajoule International on Thursday said shipment of the 20-cylinder natural-gas-fuelled Rolls Royce engine sets, manufactured in Bergen, Norway, had been completed in March.
The generator sets were now being transported by road to the R2.24-billion project, where civil construction got under way in August 2014. The construction of the power station was on schedule and within budget and it was expected to be fully operational before the end of the year. The engineering, procurement and construction (EPC) contract was executed by a consortium comprising WBHO and PB Power, while TSK was the main subcontractor. Gigajoule International CEO Johan de Vos said the power station was a “great example of the huge potential” of natural gas as feedstock for power generation in Southern Africa.
The City of Cape Town’s executive deputy mayor, Ian Neilson, says that the city wants to generate its own electricity so as to become less reliant on power utility, Eskom.
This is according to a report in Business Day, which reported that the city is interested in “entering into a power purchase agreement with a private company that will construct a gas-fired power station within the city to provide Cape Town with a power supply which is not dependent on Eskom’s monopoly”.
This will provide an anchor for the investment required to bring a gas supply into the city, Neilson said.
Eskom’s electricity woes are have been well documented in recent months, and despite continual blackouts, government officials, including President Jacob Zuma, have denied that the company is in crisis.
Neilson, who is also the mayoral committee member for finance, disagrees, stating that load shedding is costing companies in the city as much as R1 billion a month.
“A national grid powered by large power stations cannot be our sole source of energy, or even of electricity,” Neilson told Business Day.
Ten days ago, the first unit of the Medupi power station finally began adding electricity to the South African power grid, marking the end to years of delays hindering the switch-on.
“Within the next three months, South Africa will see Medupi unit six’s full potential of 794MW being fed into the South African national grid,” Eskom chief executive Tshediso Matona said.
Medupi’s total output of 4,764MW however, is only expected to be synchronised to the grid by 2019.
Synchronisation involves the generator being connected to the grid so its power is aligned with all the other generators to deliver electricity.
The South African government's Independent Power Producer (IPP) Office will release a request for information (RFI) in March for possible domestic gas-to-power projects, as a precursor to a possible 3 000 MW tender that should arise before year-end.
IPP Office head Karen Breytenbach indicated on Friday that the RFI would be used to inform a future request for proposals (RFP), which could be released into the market during the third quarter of the year.
The IPP Office had already released an RFP for the procurement of 1 600 MW of coal baseload capacity from private developers and had been engaging with companies that had purchased the documentation for R200 000. That engagement was likely to change aspects of the tender, possibly even the 1 600 MW cap, which was well below the 2 500 MW allocation outlined in a 2012 Ministerial determination.
A New Opportunity for Africa’s Energy Agenda?
Sub-Saharan Africa’s persistent power shortages act as a severe constraint on its
economic and human development.
Over the last several years, a series of major offshore gas discoveries in Mozambique and Tanzania have rekindled interest in expanding the use of natural gas to address the continent’s power shortages.
Government’s Gas Utilisation Master Plan (Gump), Integrated Energy Plan (IEP) and Integrated Resource Plan (IRP) underline that gas is not only a substitutable alternative to coal, but could also evolve to become a substantial part of South Africa’s energy mix.
Gas is flexible and can complement current energy sources. However, commentators also warn that, if considered in isolation, instead of holistically, the development of gas as an energy resource will be delayed.
Department of Energy Gump project manager Michael Fichardt says if gas were to be a signifi- cant addition to the energy mix, it could also potentially create a greater amount of renewable- energy capacity in future iterations of the IRP.
Banking group Standard Bank has confirmed the provision of $170-million in debt financing to support the construction of a 118 MW gas-fired power plant being developed by Gigawatt inRessano Garcia, Mozambique.
Gigawatt, which is a Mozambican company, has signed a long-term power purchase agreement with State-owned power utility Electricidade de Moçambique (EDM).
EDM plans to use all the power generated domestically so as to lessen the country’s dependence on imports from South Africa.
A ten-month programme investigating the viability of using clean-burning methane – in the form of compressed natural gas (CNG) and compressed biogas (CBG) – to power passenger vehicles inSouth Africa, has shown that the conversion of petrol- or diesel-powered minibus taxis and urban buses to a dual- or bi-fuel system is economically viable and can offer significant cost savings.
Bi-fuel vehicles are able to run on diesel fuel or natural gas, while dual-fuel vehicles are able to run on diesel fuel and gas simultaneously.
The real-world fleet trial, funded by the Industrial Development Corporation and conducted by automotive development and research firm Cape Advanced Engineering (CAE), saw eightGauteng-based minibus taxis converted to a bi-fuel system and one bus converted to a dual-fuel system.
Once converted, the vehicles were refuelled by three commercial filling stations, two provided pipeline CNG and the third a blend ofCBG and pipeline CNG.
The study investigated fuel consumption, vehicle operating costs,oil analysis and the financial viability of vehicle conversion to a dual- or bi-fuel system.
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