By Wendell Roelf CAPE TOWN, March 4 (Reuters) - Dutch tank storage and terminal operator Vopak has pushed back a final investment decision (FID) on South Africa's first liquefied natural gas terminal
Vopak Postpones Final Investment Decision for South African LNG Terminal
Vopak Delays LNG Terminal Investment Amid Regulatory and Market Challenges
By Wendell Roelf
CAPE TOWN, March 4 (Reuters) - Dutch tank storage and terminal operator Vopak has pushed back a final investment decision (FID) on South Africa's first liquefied natural gas terminal to 2028, a senior executive said on Wednesday.
Project Timeline and Delays
The company had planned to approved the project earlier this year, but a September court order halted power utility Eskom's plans to develop a 3,000 megawatt gas-powered plant at Richards Bay, slowing progress.
Impact of Eskom’s Gas Plant Halt
"We were waiting to see what was happening with Eskom and we just extended our pre-FEED study," Oliver Naidu, president of Vopak's local unit, told Reuters on the sidelines of an energy conference, referring to an early design study.
The company now expects to be ready to make the final decision in the first quarter of 2028, he said.
Project Cost and Phases
The two-phase project is estimated to cost around $1 billion.
Consortium and Stakeholder Engagement
Vopak’s Role in the Consortium
VOPAK IN CONSORTIUM PICKED TO BUILD, RUN THE PROJECT
Vopak was selected in 2024 as part of a consortium with Transnet Pipelines to build and run the Zululand Energy terminal at Richards Bay port for 25 years.
Potential Agreements and Partnerships
Naidu said they expected to sign preliminary agreements with Eskom, and potentially U.S oil major Exxon Mobil, in the coming months for LNG use and distribution.
Exxon is one of the strong potential customers, he said.
ExxonMobil, a global LNG supplier, previously identified South Africa as a top priority market.
The company did not immediately respond to a request for comment.
Terminal Capacity and Future Outlook
Projected LNG Import Volumes
The Zululand Energy terminal, situated along South Africa's east coast, was expected to initially import 2 million tons per annum (mtpa) of LNG by 2027 before ramping up to 5 mtpa, the Transnet National Ports Authority (TNPA) has said previously.
(Reporting by Wendell Roelf;Editing by Sfundo Parakozov and Bernadette Baum)
