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Cape Town - Coal-export terminal Richards Bay and industrial development zone Coega will be locations for a gas-to-power programme to ease the country’s dependence on coal for 70% of its electricity.
About 2000 megawatts (MW) will be allocated to Richards Bay and 1000 MW to Coega, the Department of Energy said in an information memorandum on Monday.
The government will now seek bidders to manage the project, which will be underpinned with a power-purchase agreement between the winning applicant and Eskom.
Africa’s most industrialised economy plans to convert liquefied natural gas imports into electricity to add 3 126 MW of capacity to the grid between 2019 and 2025.
The project may help make the country a niche market for LNG amid a growing global surplus of the fuel, BMI research said in an August report.
South Africa may need to source at least 3 million tonnes of LNG a year to supply the generation, Cheniere Energy Inc. said last year.
“The programme is designed to ensure that the LNG import and regasification facilities are complementary to the development of indigenous gas and/or development of a regional gas pipeline network,” the Department of Energy said.
Interested bidders must submit a request for pre-qualification in February.
