After gas find, a call for power to Western Cape
● Two liquefied natural gas power stations should be built in the Western Cape, says the provincial government.
Alan Winde, acting premier while Helen Zille is overseas, told the Sunday Times that the discovery of a huge gas deposit 170km southeast of Mossel Bay meant it was the ideal time for a gas-to-power programme to address the electricity crisis.
He said Eskom should hand over its Atlantis open-cycle gas turbine unit, which burns diesel to boost electricity supplies in times of crisis, to an independent power producer (IPP) that could convert it to run on gas. An IPP should also be given permission to build a new gas-to-power plant in Mossel Bay.
On Wednesday, an exploration consortium headed by French group Total said it had found gas equivalent to a billion barrels of oil in the southern Outeniqua basin.
In his state of the nation speech the following day, President Cyril Ramaphosa said the discovery was a possible game-changer that could have significant consequences for the nation’s energy security.
Winde said Ramaphosa’s announcement that Eskom would be broken up into generation, transmission and distribution businesses meant the time was ripe to allow IPPs to take advantage.
He poured scorn on criticism of the Eskom break-up by National Union of Metalworkers of SA general secretary Irvin Jim, who said it would lead to unaffordable electricity tariff hikes and potential job losses.
“Liquefied natural gas power is much cheaper than the alternatives of coal and nuclear,” said Winde, who will be premier if the DA retains the Western Cape in the May 8 elections.
Speaking to 150 diplomats at a reception on Friday, Winde said Total’s discovery in its Brulpadda Prospect presented the country with a “completely new opportunity”.
He added: “As the president is now calling for projects that are ready to invest in, I want to urge him to immediately grant IPP status for liquefied natural gas to power [the Atlantis open-cycle gas turbine].
“Not only has the environmental impact assessment already been completed in this area, but it will ensure that for the medium term, energy provision is secure.”
The discovery — the first in SA’s deep water territory — may prompt a rush of activity offshore by competitors, Bloomberg said.
“It is really transformational,’’ said Andrew Latham, vice-president of global exploration at consultancy Wood MacKenzie. “This could be a discovery that kick-starts a bit of a gas strategy for SA.”
Exxon Mobil and Eni also hold stakes in the Outeniqua basin, where Total is drilling four more exploratory wells, and may decide to take advantage of forthcoming legislation aimed at spurring exploration.
Niall Kramer, CEO of the industry lobby group the South African Oil & Gas Alliance, described the Total find as “catalytic” and said: “There’s nothing that has been on this kind of scale.”
As the president is now calling for projects that are ready to invest in, I want to urge him to immediately grant IPP status for liquefied natural gas to power [the Atlantis open-cycle gas turbine]
Alan Winde
Western Cape acting premier