Eskom Ties Planned Gas Plant to South Africa's First LNG Terminal

New infrastructure and supply agreements are beginning to reshape South Africa's gas market, with one major project now moving closer to reality.

(Reuters) — South African power utility Eskom signed a long-term liquefied natural gas agreement with the Zululand Energy Terminal that will support Eskom's planned 3,000 megawatt gas-to-power project, the two companies said on June 5.

• Zululand Energy Terminal is South Africa's first LNG import terminal situated along the east coast in Richards Bay port.
• As a result of the deal, Eskom will have open access to LNG import, storage, and regasification infrastructure.
• Eskom's planned 3,000 MW gas-fired power plant has been stalled by acourt order citing inadequate public consultation.
• Zululand terminal, a joint venture between Dutch company Vopak, local energy firm Reatile and state-owned Transnet Pipelines, was awarded the concession to build and operate the terminal in 2024.
• The planned power plant will use regasified LNG as the primary fuel source over its expected lifecycle of 25 years.
• South Africa is pivoting towards gas as a transitional fuel and has set aside 6,000 MW for gas power as part of its energy mix by the turn of the decade.