Landmark oil and gas workshop gets underway in Port Elizabeth

AUGUST 23, 2016

The Eastern Cape Department of Economic Development, Environmental Affairs and Tourism (DEDEAT) is holding a landmark two-day workshop in Port Elizabeth with some of the country’s most influential players to “help build a compelling role for the Eastern Cape in the country’s multi-billion oil and gas industry”.

The discussions, to be introduced by DEDEAT MEC Sakhumzi Somyo, aim to strengthen the province’s position and help navigate the unchartered territory of creating an oil and gas industry that will service the province and South Africa, and at the same time, provide unprecedented stimulus to the Eastern Cape economy.

The Eastern Cape sees the gas industry as all the activities in the value chain for supplying gas for power, and commercial and industrial use.

The delegates which include the Development Bank of Southern Africa, the Presidency, Central Energy Fund, Shell, PwC, the sector training and education authorities, the national Departments of Energy and Trade and Industry, the Independent Power Producers Office, will provide crucial input into the plan.

Important provincial role players such as the Coega Industrial Development Zone (IDZ), East London IDZ, Nelson Mandela Bay Metropolitan Municipality (NMBMM), the city’s business chamber and the Eastern Cape Premier’s Office, are key to delivering a completed action plan by December 2016.

“This workshop is critical to ensuring that the efforts of government, business and the skills sector are aligned and support gas industry investments in the Eastern Cape,” says Somyo.

It also adds to the extensive work conducted to align to pivotal national programmes such as Operation Phakisa, the Integrated Resource Plan, nine-point plan, the Industrial Policy Action Plan, which are underpinned by the National Development Plan.

The province’s proposed gas industry plan outlines five scenarios and pathways that are likely to succeed in the province over next 10 to 15 years.  

The scenarios, with Coega earmarked as the preferred site, consider pipeline distribution of gas, 4.5 gigawatt Coega gas terminal, developing storage and regasification units and/or a land-based terminal with pipe supply to offtakers, small scale distribution of gas to industrial and commercial users, other power stations in the province and neighbouring provinces.

The Coega IDZ has gone some way in its preparations, having undertaken environmental studies for four sites which it has identified for the power plant and land-based liquid natural gas (LNG) terminal.  It has also completed the preliminary work for the combined cycle gas turbine (CCGT) power project which entails the LNG facilities and gas-to-power plant.  It is already the home of the Dedisa power station which could be converted to gas.

DEDEAT also points to key infrastructure such as the Port of Ngqura and its proximity to the province’s shale gas resources.

Furthermore, gas energy investors have already shown interest in Coega being their preferred location.

The province’s plans for a gas economy fit well with its aspirations to become the hub for cleaner energy.  The Eastern Cape is already home to 16 wind farms and one solar farm.

Somyo adds that this project in support of a gas industry project also provides an opportunity to build more momentum for increasing the business appetite for gas energy.

“We are confident that we can build good local demand which will further strengthen our business case.  Locally-produced gas energy will have the knock-on benefits of securing our energy supply, be cheaper, create more business opportunities and jobs which will grow our economy,” ends Somyo.

A further workshop will be held in coming months to finalise the province’s plans after which it will move to the province’s Operation Phakisa programme.

Image: DEDEAT MEC Sakhumzi Somyo. file photo