May 28 (Reuters) – South African state company Transnet’s ports division has signed a 25-year terminal operator agreement with Ukwanda LNG to develop an onshore regasification facility at the port of Ngqura in the Eastern Cape, it said on Thursday.
Ukwanda LNG is a joint venture between Tamasa Energy Group and South Africa’s Strategic Fuel Fund, Transnet said in a statement.
South Africa is pivoting towards natural gas as a transitional fuel as it moves away from coal-fired plants that provide the bulk of its electricity needs.
Global trader Vitol is backing a $3 billion LNG terminal project in Durban, while Dutch tank storage and terminal operator Vopak pushed back a final investment decision on the country’s first LNG terminal to 2028.
“This milestone represents a profound shift in how South Africa utilises its commercial seaports to support national energy security,” Michelle Phillips, Transnet Group Chief Executive, said in the statement.
The Ukwanda LNG project is expected to involve investment of about 22 billion rand ($1.34 billion), including a dedicated LNG berth at one of the country’s deepest ports, with full operations by 2035, Transnet added.
