"Energy development from gas is especially important because it will assist the country to meet base-load energy needs between 2020 and 2030. The upside for gas-to-power projects is its character for relatively shorter gestation period," said Sandisiwe Ncemane, Coega Development Corporation (CDC) energy manager.
The CDC issued a tender notice for an environmental impact assessment (EIA) for gas-to-power facility. The proposed facility will be conveniently situated less than 4km from the 400kV Dedisa substation, which will significantly reduce costs for taxpayers and authorities.
According to Sasol's chairman, David Constable, special economic zones such as Coega are ideally suited because of their location to gas producing global regions, and because of its proximity to South African shale gas mining fields in the Karoo.
As a key player in the industry, CDC is aware of discussions highlighting some of the challenges raised by industry captains, one of those, key challenges relate to infrastructure.
"The CDC's case is strengthened by existing infrastructure as it reduces costs for business through its proximity to the planned processing facility that will convert LNG into gas and a 2km pipeline to the power plant that will generate electricity from natural gas," added Ncemane.
The proposed gas-to-power plant will be the second power plant in the Coega IDZ after the Dedisa Peaking Power Plant - R3.5bn, liquid fuel open cycle gas turbine with a 342MW generation capacity.
The CDC is one of the most advanced in terms of preparations for gas to power projects and is the ideal location for the LNG berth. "One of the critical game changers for the CDC is the cost factor. The Dedisa Power Peaking Plant currently in commissioning in zone 13 of the Coega IDZ, with
the existing environmental authorisation for 400kV transmission lines from project site to substation reduces the costs of the gas to power project," added Ncemane.
Another factor is that CDC, since 2006, has undertaken at least five EIA studies supporting the gas-to-power solution. "EIA studies were concluded for rezoning of land in the IDZ, the establishment of a 400kV transmission line between the plant site and the Dedisa substation, and the marine pipeline servitude EIA which is currently under way."
"Further, a draft scoping report was also prepared by Eskom and CeF/iGas for a LNG-to-power project. Transnet's port development plans include the LNG terminal in the Port of Ngqura, identifying several berth options for its deep-water seaport adjacent to the Coega IDZ," added Ncemane.
The strategic environmental assessment (SEA) for shale in the Karoo is a relevant development and shale gas is a key determinant in developing a LNG solution for the country. The Nelson Mandela Metropolitan University, a critical partner in the study of knowledge and skills development will be providing input into the SEA.