Page 9 - GLNG Week 28 2022

GLNG COMMENTARY GLNG

where you have to look at the Free State relative Renergen expected companies needing fuel
to the rest of the country. If you think about it, for generators that would allow them to avoid
we’ve got access to the N1, the N3 and the N5 load-shedding to be one of its three main groups
highways, all within almost equal distance. The of LNG buyers. However, he did not address the
ground is flat, there’s a lot of available land, and possibility that the number of such companies
it’s relatively well priced … And [with LNG], – and the level of interest in LNG-fuelled gener-
you’ve got a source of clean sustainable energy ators – is likely to rise in the near term.
in the area, which means that from an attrac-
tiveness perspective, you’ve got the labour force South Africa’s energy sector has been in a
there as well, and highly skilled. You’re sitting in a sub-optimal state for more than a decade. Cus-
position where strategically it makes more sense tomers of Eskom, the national power provider,
to set up industrial operations and manufactur- have come to expect blackouts and load-shed-
ing operations in the Free State over, say, Jo’burg. ding as a regular feature of service. However,
We really do see this project becoming over time conditions have grown even worse over the last
a catalyst for the area.” few weeks, with plant breakdowns and strikes
He continued: “So the project itself? Yes, gas taking some 18,000 MW of generating capacity
doesn’t employ as many people as mining does. offline. President Cyril Ramaphosa said on July
But we believe we will leave a much longer-last- 11 that his government would take action to mit-
ing legacy in the area than the mining houses igate the shortages soon, but it remains to be seen
will.” whether conditions actually improve.
If they do not, Renergen may find that news
Could power crisis boost LNG? of its Phase 1 launch generates more interest in
In the meantime, though, Renergen may also LNG and LNG-fuelled generators than it might
have a chance to have a significant impact in the ever have expected in the short term. In turn, if
short term. interest in LNG remains strong, Renergen may
Marani did not talk much about what role want to consider ramping up the scale of Phase 2
his company might play in South Africa’s cur- so that it can serve more customers within South
rent energy markets. He did note briefly that Africa.™

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