Friday, September 20, 2024

Eskom and energy and chemical company, Sasol, have signed a Memorandum of Understanding (MoU) to "collaboratively explore and investigate possible potential liquified natural gas (LNG) requirements".

That is according to a joint statement by the two organizations, following the signing ceremony from the MoU on Friday.

"The collaboration aims to determine the likely volumes that South Africa requires to establish a viable LNG import industry, combined with the enabling infrastructure, and can be facilitated by authorities-to-federal government relations the place necessary."

"This initiative focuses on utilizing gas for energy generation to supply crucial base load electric power and position gas to be a key enabler of re-industrialisation, though also making sure ongoing supply to the market by unlocking international LNG resources.

"Furthermore, the collaboration will contribute to enhancing South Africa’s energy mix and enable the country's energy transition and decarbonisation," the joint statement read.

The MoU is expected to "explore sourcing gas within South Africa, the Southern African Development Community region, and other parts sasol learnerships of the African continent, in addition to evaluating long-term LNG contracting".

"This will support the gas requirements for Eskom’s planned coal power station repowering and conversion to gas in the long term. The parties will also engage other state entities to enable an LNG value chain in South Africa.

"As part of its revised gas strategy, Sasol is working on enabling the future supply of LNG to South Africa by collaborating with companies such as Eskom, existing and future customers, suppliers, and infrastructure developers.

"The research findings from the first phase of the Sasol-Eskom collaboration will guide the necessary role players and investors required to offer the best prospects for South Africa's energy market, while outlining the challenges associated with the long-term commitments required for LNG imports," the statement said.