Eastern Cape emerging as SA energy hub

15 May 2019 | Web Article Number: ME201914570

Power Generation
Special Economic Zones

The Eastern Cape is emerging as an energy hub, reflective of South Africa’s approach to a diversified energy mix.

That’s according to the province’s Department of Economic Development, Environmental Affairs and Tourism (DEDEAT), which is aggressively promoting the region’s potential, particularly in offshore Oil and Gas (O&G) at the 19th annual African Utility Week, being held in Cape Town from 14 to 16 May 2019.

“Our participation in one of the discussion panels will touch on the continued progress the department has put in the O&G strategic framework for the province as well as ongoing activities,” said Bongani Gxilishe, Head of Department DEDEAT ahead of the event.

“The strategic framework is aimed at enabling a rapid and coordinated development for the province to meet the demand for identified products and services within the gas-to-power value chain and to ensure that progress within the LNG sector provide for maximum localised benefit.”

Gxilishe said this approach was integral to the medium-term objective of enabling and unlocking the exploration of indigenous O&G.

The province has been actively advancing its readiness for the establishment of gas-enabling infrastructure at Coega as one of the preferred locations identified in the country.

The Coega Development Corporation (CDC), in collaboration with various state organs and private developers, has conducted extensive preliminary readiness work, including technical feasibility studies and advancing EIAs relating to the gas-to-power infrastructure.

The province has also been conducting studies that look at the industrial gas utilisation beyond the 1000 MW gas–driven power generation.

According to Gxilishe, the significance of the EC is that it is endowed with the possibility of both onshore and offshore gas, gas-driven power generation, and gas importation, handling, trans-shipment infrastructure, as well as industrialisation.

Potential recoverable quantities of indigenous natural gas are in the order of 20 trillion cubic feet onshore (shale gas), and 26 trillion cubic feet offshore.

“The recent deepwater drilling in Brulpadda (approximately 1 billion barrels) in the Southern Outeniqua basin could potentially unlock enough fuel to supply South Africa’s refineries for almost four years. That’s a boon for a country that has always been short of oil and is running out of its scant domestic supply of gas,” Gxilishe said.

“This could potentially unlock a value chain of marine/ maritime services located at Coega SEZ which could in turn trigger opportunities eastwards including nodes such as the East London IDZ and small harbours along the Wild Coast. The Brulpadda-1 and the potential for more discoveries positions the Eastern Cape as an active O&G province.”

In line with SA’s developmental programme, indigenous gas extracted in this province must be beneficiated on our shores, maximising the economic benefit yielding within the region.

With this in mind, the province, through DEDEAT, has initiated a strategic framing process for the provincial oil, gas and maritime complex which Gxilishe said had provided much greater clarity and support for the socio-economic development of the gas industry.

“The province, with its gas support initiatives organized in a coherent framework, is well positioned to drive the enablers for a gas economy.”

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