The Department of Energy (DoE) announced yesterday at the Energy Indaba in Sandton that it plans to build the infrastructure to import natural gas for electric turbines, to build out its co-generation plans with a mix of coal and gas generation. This in the hopes of closing the shortage of generation capacity in the country.
Wolsey Barnard, acting director-general for the department said, “We have very limited gas infrastructure and need to develop it for imports.”
These projects are being accelerated and opened for participation by the private sector. However this will not be a short-term solution as Barnard predicts implementation will take 24 to 30 months.
According to Bloomberg, parastatal Eskom – which generates over 95% of the country’s power – has been spending over US$1bn per month on diesel to run ‘peak-use turbines’ constantly. However, Jacob Zuma instructed the utility in his State of the Nation address to switch to gas generation to alleviate the high diesel costs.
Zuma said that the procurement process for 2,400MW of new, gas-fired generation will begin sometime before July.
State-owned oil company PetroSA is also considering gas-import terminals, Ebrahim Takolia, CEO of the South African Oil and Gas Alliance, said in a panel discussion at the conference. “Importation is a good way to develop the local market.”
Karoo shale gas
Royal Dutch Shell Plc and Falcon Oil & Gas Ltd. have applied to explore the Karoo region for shale gas, suspecting a deposit of around 390 trillion m3 in the area.
According to Bloomberg, South African and Mozambican state-owned investment companies have joined with SacOil Holding Ltd. to study a US$6bn pipeline from a natural-gas field off the northern coast of Mozambique. The field could make Mozambique the largest exporter of liquefied natural gas after Qatar and Australia, with deliveries targeted from 2018.
By Jenni McCann