South Africa announces preferred bidder for new LNG terminal at the Port of Richards Bay

  • South Africa’s state owned ports authority, Transnet National Ports Authority (TNPA), has appointed the Vopak Terminal Durban & Transnet Pipelines (TPL) Consortium Venture as the preferred bidder to develop and operate a Liquefied Natural Gas (LNG) terminal at the Port of Richards Bay.

The terminal is set to change the economic dynamics of the port city, the KwaZulu Natal Province and introduce an alternative source of energy as South Africa battles an energy crisis and transitions towards decarbonization.

Following a procurement process through a Request for Proposals, TNPA has appointed the Vopak & TPL Consortium Venture to design, develop, construct, finance, operate, and maintain the LNG terminal in the South Dunes Precinct at the Port of Richards Bay for a period of 25 years. The terminal is a partnership between the private sector and the public sector, with the private sector as the lead investor. TNPA will invest in the Common User Port Infrastructure, while the terminal operator will provide the terminal infrastructure.

“TNPA is excited about the prospects this project brings, especially that this gas infrastructure project will be the first of its kind in South Africa. This is a testament to our dedication to promoting economic activity, job creation, and sustainable energy solutions,” said Moshe Motlohi, TNPA Managing Executive for the Eastern Region ports.

This milestone brings TNPA closer to its strategic goal of assisting the country through this LNG import terminal and as a midstream LNG importation infrastructure for markets in the KwaZulu Natal hinterland.

Vopak is a Dutch private company, listed on the Euronext Amsterdam stock exchange, and is a major player in the Oil & Gas sector including LNG infrastructure development and operation. Vopak has a network of 78 terminals including Gas, Industrial, Chemical, and Oil in 23 countries and has a strong footprint in supporting the global trade of Oil & Gas products and services.

Transnet Pipelines (TPL) is a South African public company established in 1965 and plays a critical role in the energy industry in the South African economy. TPL is a custodian of the country’s strategic pipeline assets and is currently servicing two key industries fuel and gas by transporting petroleum and gas products over varying distances. TPL handles products including gas, crude oil, diesel, leaded & unleaded petrol and aviation fuels.

This project is in line with the Department of Mineral Resources and Energy’s (DMRE’s) Strategic Plan for 2020-25, which focuses on the development of the gas market as an alternative source of energy to meet limited and depleting energy supply. It also supports the country’s Integrated Resources Plan and its gas-to-power generation targets.

Project timelines will see the commercial operation during 2027, with the next step being the signing of the terminal operator agreement which is currently under negotiation.

Author: Bryan Groenendaal

Source: Transnet National Ports Authority

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