TPL awarded contract for LNG terminal project in South Africa

Vopak Terminal Durban & Transnet Pipelines (TPL) Consortium Venture has been awarded contract for the development and operation of a liquefied natural gas (LNG) terminal at the Port of Richards Bay.

Transnet National Ports Authority (TNPA) made the appointment for the project which aligns with the Department of Mineral Resources and Energy’s (DMRE’s) Strategic Plan for 2020-25, focusing on developing the gas market as an alternative energy source to meet the country’s energy supply challenges. It also supports the Integrated Resources Plan and gas-to-power generation targets.

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Impact

The LNG terminal project is expected to have a positive impact on the economic dynamics of the port city, KwaZulu Natal Province, and provide an alternative source of energy as South Africa addresses its energy crisis and moves towards decarbonization. The partnership between the private and public sectors, with TNPA as the lead investor in common user port infrastructure, reflects a collaborative effort to enhance the country’s energy infrastructure.

The commercial operation of the LNG terminal is anticipated in 2027, pending the negotiation and signing of the terminal operator agreement. TNPA sees this project as a crucial step in achieving its strategic goal of assisting the country through the development of midstream LNG importation infrastructure for markets in the KwaZulu Natal hinterland.

TNPA has taken steps to support South Africa’s transition to a low-carbon economy by issuing a request for information (RFI) in 2023 for the development of a terminal facility and related facilities for hydrogen initiatives at its commercial seaports. This includes assessing market interest in projects related to green hydrogen, green ammonia, green methanol, and/or grey hydrogen at various ports in the country.