Construction|Engineering|SECURITY|Africa|CoAL|Engineering News|Eskom|Imperial Crown Trading|Marine|Mineral Resources|Mining Weekly|Projects|Renewable Energy|Renewable-Energy|Resources|Security|Sishen Iron Ore Company|Water|Africa|South Africa|North Gauteng High Court|Security|Sishen Mine|Energy|Mining|Renewable Energy Developers|Renewable Energy Feed-in Tariff|Renewable Technologies|Security|Northern Cape|Environmental|Iron Ore|Power|Security|Terence Creamer|Water|Engineering News|Mining Weekly
© Reuse this
It’s that time again on a Friday when AMLive presents another Update From The Coal-Face with Terence Creamer, editor of Engineering News and a contributing editor at Mining Weekly.
De Gouveia: Potential renewable energy developers are currently sifting though bidding documentation released by the Department of Energy earlier this month.
Creamer: As you may remember there was a process that took place back in 2009, whereby Nersa set out tariffs for the various renewable technologies, under the renewable energy feed-in tariff (Refit) model
That led developers to begin preparing projects as the tariffs were seen as very favourable.
Then there was the Eskom tariff application, which set aside a small portion of the increases to help facilitate the first renewable projects under Refit.
After that there were a number of delays, but eventually an expression of interest was called by the DoE and National Treasure in the last quarter of 2010, which saw a very big response.
In the meantime, government appointed lawyers to do a legal audit of the process and they found a few problems with Nersa having set predetermined tariffs, given that South Africa procurement rules require a determination on either price or BEE.
So eventually the Refit was abandoned in favour of a process whereby there ill be an element of price competition. People are now dubbing this the ‘Rebid’.
Anyway the tender document was made available for a R15 000 fee as from Aug 3, and developers are now poring over these documents.
De Gouveia: Are we finally on the cusp of major progress in this area?
Creamer: The indications are that while developers would have preferred the Refit, the tender should still attract interest.
There is also a lot happiness that the biding process is for nearly 3 800 MW, rather tan the 1 025 MW envisaged under the Refit first round.
There will be a bidders conference on September 14 and the preferred bidders could be selected by November. Therefore, we should expect financial close on these first projects in early 2012 and construction to begin next year two.
Now this is big, as the first round is going to involve investment of between R70bn and R100bn across wind, solar, biomass, biogas, minihydro and some other technologies.
And it’s also just the start of a larger deployment of 17 800 MW of renewable anticipated in the IRP between now and 2030.
De Gouveia: Billions at stake as a High Court judge applies his mind to the complex Sishen iron-ore rights matter.
Creamer: As you mentioned it is a complex case and the prize is huge. The oral arguments from Sishen Iron Ore Company (which is owed by Kumba), ArcelorMittal South Africa, the Department of Mineral Resources (DMR) and Imperial Crown Trading (ICT) were heard in the North Gauteng High Court last week.
Judge Raymond Zondo has reserved judgement in the matter, as he does not only need to consider the oral submissions, but also mountains of written material that was prepared by the lawyers for the various participants.
In essence, though, we have Kumba and Mittal asking the courts to overturn the DMR’s decision to award a prospecting right at the well-established Sishen mine, in the Northern Cape, awarded to ICT. This right was awarded by the DMR after both ICT and Kumba applied for the 21.4% that they said became vacant on April 30, 2009, when Mittal failed to apply to convert it.
However, Mittal has argued that it did not need to covert, as the Sishen Iron Ore Company had converted the undivided right in full in 2008 and that they merely had a 21.4% interest in that now converted right.
Kumba, on the other hand, is adamant that there were two distinct rights that needed to be converted. But Kumba argues that it should have received the converted right, as its application met the requirements under the law and ICT’s did not. In fact, it argues that ICT included documentation fraudulently obtained and copied from Kumba’s own application and should not have been considered on that basis alone. But it also raised other questions about the competence of the ICT application and DMR’s adjudication process.
DMR, for its part, is also alleging fraud against Kumba in the way it submitted its application.
So as you can see, it’s complicated and Judge Zondo has indicated at he needs time to make his ruling.
But the judge may not have the last word, with criminal charges having already been laid, which led to the recent controversial Hawk raid, as well as given the potential for appeals.
Nevertheless, what he says will be a vital step in moving this unhappy, yet vital, matter closer to a conclusion.
De Gouveia: Umgeni Water has started to consider desalination options to augment water supply in eThekweni.
Creamer: Yes, a number of municipal areas in South Africa area beginning to consider desalination as one of the options for closing what is likely to be a tightening water supply- demand equation in the coming years.
Some have actually already moved to build some desalination capacity, while others such as the City of Cape Town have indicated that they intend to study the feasibility of large-scale desalination to add to supply security.
But the latest utility to signal that it too will be probing desalination as a possible option is Umgeni Water.
It is initiating an investigation into the development of two 150 Ml/d reverse osmosis desalination plants to augment supply to the fast-growing eThekweni metropolitan area.
The solution is being studied along with various other augmentation schemes, but Umgeni Water has called for bidders to submit tenders by September 15 to conduct a detailed study of the 300 Ml/d desalination option.
Obviously, there will also need to b environmental impact assessments, to gauge acceptability on this score. For instance, work will have to be don on the marine impacts of the discharged brine, as well as the energy footprint of the plants
It is understood that about 4 kWh of power is required for every kilolitre and Umgeni Water will assess the prospects of possibly sourcing this power from renewables projects that are likely to be developed.
De Gouveia: Terence Creamer is editor of Engineering News and a contributing editor at Mining Weekly. He’ll be back At The Coal-Face at the same time next Friday.
Edited by: Creamer Media Reporter
© Reuse this
Comment Guidelines (150 word limit)
Independent, black-owned and managed investment holding company Southern Palace Properties has acquired an 8% stake in Growthpoint Properties from the Public Investment Corporation’s (PIC’s) Government Employees Pension Fund (GEPF) for R4.5-billion. Standard Bank...
Shareholders of JSE-listed real estate investment trusts (REITs) Octodec and Premium Properties have approved the proposed merger of the two companies, creating a combined property fund that will attract a market capitalisation in excess of R5-billion and comprise...
The Metal and Engineering Industries Bargaining Council (MEIBC) this week called on employees and employers to exercise restraint as the metals and engineering industries resumed operations following a four-week strike, stating that it regretted the strike’s...
Recent Research Reports
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
Real Economy Insight: Steel 2014 (PDF Report)
This four-page brief covers key developments in the steel industry over the past 12 months. It provides an overview of the global and South African steel and stainless steel markets, South Africa’s major steel producers and events that have shaped these markets.
This Week's Magazine
Updated 1 hour 35 minutes ago
South African construction company Group Five says work on the rehabilitation of the 800 km stretch of the Plumtree–Mutare highway, in Zimbabwe, should be completed by the end of this year. Giving evidence before the Parliamentary Porfolio Committee on Transport...
SINGLE EXPERIMENT An artist’s impression of OCO-2 in orbit
Updated 1 hour 38 minutes ago
The Space Operations division of the South African National Space Agency (Sansa) revealed on July 17 that it had supported the successful launch of the US National Aeronautics and Space Administration’s Orbiting Carbon Observatory-2 (OCO-2) satellite on July 2. The...
RICE TAG The real costs of operating Rea Vaya have become clear
Updated 1 hour 38 minutes ago
Phase 1A of Johannesburg’s Rea Vaya bus rapid transit (BRT) system should carry around 42 000 people a day, while it was been expected that Phase 1B, rolled out last year, would add another 60 000 daily passengers. However, the entire system is currently carrying...
Updated 1 hour 38 minutes ago
A stormwater project in Bedforview, east of Johannesburg, has stalled for eight months after project managers in the Ekurhuleni municipality resigned and municipal managers were placed on special leave without designating replacements. Construction to reinforce the...
Updated 1 hour 38 minutes ago
The design of the Beit Bridge border post is the biggest impediment to efficient freight movement between Zimbabwe and South Africa, says Cross-border Road Transport Agency CEO Sipho Khumalo. Beit Bridge is the busiest border post in Africa. A research study on the...