Huge gas boost touted for Coega

Eastern and South­ern Cape ideally sited for part of R645bn po­ten­tial

The Herald (South Africa) - - BUSINESS -

NAT­U­RAL gas should play a R645-bil­lion role in South Africa’s fu­ture energy mix‚ ac­cord­ing to a new re­port from an­a­lysts Econometrix.

It would add that amount to gross do­mes­tic prod­uct and cre­ate 1.7 mil­lion jobs, some of them at Coega, a study shows.

“Gas is nec­es­sary for South Africa to meet its tar­get growth rates and po­lit­i­cal‚ eco­nomic and so­cial ob­jec- tives‚” Econometrix man­ag­ing di­rec­tor Rob Jeffrey said yesterday. “There should be a na­tional plan to in­crease the use of gas sub­stan­tially.”

Cre­at­ing a nat­u­ral gas sec­tor would un­lock bil­lions of rands of in­vest­ment while stim­u­lat­ing new in­dus­tries and skilled job cre­ation.

Com­bined with the right poli­cies‚ an ad­di­tional 8 600MW of elec­tric­ity from gas could be added, ac­cord­ing to the re­port ti­tled “The fu­ture role of gas in SA’s power and in­dus­trial de­vel­op­ment mix”.

Gas was the cheap­est al­ter- na­tive to coal and nu­clear power‚ of­fer­ing se­cu­rity of sup­ply at com­pet­i­tive prices‚ Econometrix said.

It would sup­ply re­li­able power for peak de­mand pe­ri­ods or when re­new­ables were not gen­er­at­ing elec­tric­ity‚ and would add to the es­sen­tial re­serve ca­pac­ity.

It was tech­ni­cally and com­mer­cially fea­si­ble to start gas-fu­elled power gen­er­a­tion at Coega in the Eastern Cape‚ and Sal­danha Bay or Mos­sel Bay in the Western Cape.

Other po­ten­tial lo­ca­tions were Richards Bay in Kwa- Zulu-Natal and Sishen in the North­ern Cape. Mbombela in Mpumalanga also had the po­ten­tial to be supplied by pipeline from Mozam­bique.

For each lo­ca­tion‚ de­vel­op­ing a nat­u­ral gas in­dus­try with R15-bil­lion an­nual turnover could see down­stream an­nual turnover up to R50-bil­lion‚ with R26-bil­lion to­tal added eco­nomic value.

Av­er­age up­stream and down­stream po­ten­tial em­ploy­ment cre­ated could peak at 70 000 dur­ing the ma­ture phase of the pro­ject’s life‚ Econometrix said.

Other sig­nif­i­cant eco­nomic ben­e­fits in­cluded R2-bil­lion sav­ings in diesel im­ports‚ in­creased tax rev­enue and cur­tail­ment of fu­ture elec­tric­ity price in­creases, all with a pos­i­tive im­pact on the fis­cus.

The study was com­mis­sioned by Delta Nat­u­ral Gas‚ started by South African in­dus­tri­al­ist Ald­worth Mbalati last year. –

‘ Gas must play an im­por­tant role if South Africa is to meet its eco­nomic‚ po­lit­i­cal and so­cial ob­jec­tives of re­duc­ing poverty

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