Transnet plans to begin a tender next year for South Africa’s first terminal to import LNG at Richards Bay port. First gas is expected to arrive in 2024, as South Africa wants to diversify its energy sources away from coal, and increase its ability to reduce power cuts that have hit growth.
Transnet will be the leader of the project, Reuters said, after the World Bank’s International Finance Corp promised $2 million to assist finalise the design, finance, construction and operation plans.
The project needs re-purposing current pipelines to transport gas between Durban and Johannesburg.
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Moreover, Jabulani Sithole, a Transnet oil and gas business manager, believes that it is crucial to secure new gas supplies as Sasol had mentioned that it would face supply constraints from 2023, because of maturing fields at Temane and Pande.
In addition, a pre-feasibility study would conclude the costs of the LNG terminal project, while Transnet will seek LNG suppliers, like Shell and BP.
What is more, the regasification terminal could be on land or a Floating Storage Regasification Unit serving Richards Bay and other ports, such as Coega. There, plans exist for a gas-fired power plant.
