Feb 23, 2012
Coal miner Exxaro to submit five renewable energy bidsBack
© Reuse this
Exxaro, which established a joint venture (JV) called Cennergi with an undisclosed third party, is planning five renewable energy projects – two solar and three wind.
The JV would submit tenders under the Department of Energy’s (DoE’s) ‘request for qualification and proposals for new generation capacity’ in the second bidding window, which closes on March 5.
In total, the DoE was seeking to procure 3 725 MW of renewable energy capacity from independent power producers (IPPs) between 2012 and 2016. The first bidding window closed in November last year.
Meanwhile, Exxaro continued to explore opportunities in the energy markets with a focus on cleaner energy initiatives. Nkosi stated that it was good for South Africa to have the right mix of energy sources.
Exxaro, which is South Africa’s second-largest coal producer, also reported that a prefeasibility study for the development of a 600 MW to 1 200 MW coal-fired base-load power station in the Waterberg, in Limpopo, was under way.
The company selected four base-load IPPs and would announce the preferred bidder in the first half of 2012. Further, nonbinding term sheets for the off-take of 1 150 MW of electricity have been signed between Exxaro and industrial off-takers.
Construction of a 14 MW cogeneraion plant at the miner’s Namakwa Sands project, in the Northern Cape, was expected to start in the second quarter of 2012 and a prefeasibility study for a 60 MW cogeneration plant at its Grootegeluk mine was expected to be complete in the first half of the year.
Further, the first half of 2012 would see a clearer indication of the potential of the evaluation of underground coal gasification opportunities on Exxaro’s coal tenements in South Africa and Botswana.
Meanwhile, Exxaro would continue to grow its coal division as the country has an abundance of coal reserves, which were cheap to mine, said Nkosi.
The Grootegeluk mine expansion project, in Limpopo, which would supply State-owned power utility Eskom with 16.4-million tons a year of coal for the Medupi power station, progressed within its R9.5-billion budget. The mine expansion is 72% complete and would deliver first coal in May 2012.
First coal production at the proposed greenfield Thambametsi development project, adjacent to Grootegeluk, was expected during 2016/17. The project would supply coal to a base-load IPP.
Further, the bankable feasibility study of Exxaro’s Belfast project was expected to be complete by the second half of 2012. Start-up and first production was expected in 2014.
Nkosi pointed out that its coal business would continue to seek alternatives to export the company’s increased coal volumes, however, continued good performance from Transnet Freight Rail (TFR) was expected.
He welcomed Transnet’s infrastructure initiatives, as increased ports and rail capacity would enable the coal industry to increase production and meet the export demand.
Transnet is embarking on a R300-billion, seven-year investment programme to expand South Africa’s ports, railways and pipelines.
This would enable Exxaro to build and strengthen its coal export leg and feed into the unlocked capacity, Nkosi stated.
Exxaro’s coal division reported a 24% increase in net operating profit to R3.4-billion, up from R2.6-billion in the year ended December 2010, as well as a coal revenue increase of 21%, reaching R12.7-billion in the 2011 financial year, from R10.5-billion in the comparative period last year. This was attributed mostly to higher selling prices and stronger international demand.
The diversified miner increased its export volumes by 20% to 4.9-million tons, boosted by better performance from TFR.
However, its power station sales fell 11%, owing to a 24% drop in coal production at Eskom-tied operations on the back of adverse geological conditions, the closure of the Mooifontein opencast operation at the Arnot mine, as well as the flooding in Mine 2 at Matla.
Domestic non-Eskom sales fell 9%, mainly because of production challenges at its NBC mine.
Coking coal output declined 11%, because of lower demand from Arcelor Mittal South Africa, which was partially offset by higher output at the Tshikondeni mine.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Creamer Media Senior Researcher and Deputy Editor Online
Other Intellectual Property Law News
Alcatel-Lucent has organized in early July its Technology week in Nigeria. The Alcatel-Lucent Technology Week took place at a three-day event in both Lagos and Abuja. The event was well attended by over a hundred professionals from Nigeria ICT ecosystem....
If you were asked to imagine a computer network, the image that springs to mind would probably be one of a pristine office setting, where networking equipment is kept behind spotless glass doors in a dust- and temperature-controlled environment. But what of the real...
The Southern African Vinyls Association announced that Belgotex Floors has become the Association’s first official license holder of the Vinyl. product label – a mark of excellence that signifies the product complies with best practice as prescribed by SAVA’s Product...
Updated 50 minutes ago The contraction in the metals and engineering sector is worsening, the Steel and Engineering Industries Federation of Southern Africa (Seifsa) warned on Thursday. Speaking after the release of production numbers by Statistics South Africa, Seifsa chief economist Henk...
Updated 1 hour 2 minutes ago Local innovation will undoubtedly provide solutions to many of the challenges faced by Africa, as it sets the tone for progress and enables businesses to gain a competitive advantage, create additional jobs and change peoples’ lives. Speaking as part of a panellist...
Updated 1 hour 16 minutes ago Zambia and Zimbabwe drew more water than they should have from the Kariba dam to generate electricity, draining the reservoir to 29% of its capacity in September, compared with 70% capacity last year, an engineering body said on Thursday. The Zambezi River Authority...
Recent Research Reports
Liquid Fuels 2015: A review of South Africa's liquid fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2015 Report examines these issues in the context of South Africa’s business environment; oil and gas exploration; fuel pricing; the development of the country’s biofuels industry; the logistics of transporting liquid fuels; and...
Road and Rail 2015: A review of South Africa's road and rail sectors (PDF Report)
Creamer Media’s Road and Rail 2015 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail infrastructure and network, the funding and maintenance of these respective networks, and...
Defence 2015: A review of South Africa's defence sector (PDF Report)
Creamer Media’s Coal 2015 report examines South Africa’s coal industry with regards to the business environment, the key participants in the sector, local demand, export sales and coal logistics, projects being undertaken by the large and smaller participants in the...
Real Economy Year Book 2015 (PDF Report)
There are very few beacons of hope on South Africa’s economic horizon. Economic growth is weak, unemployment is rising, electricity supply is insufficient to meet demand and/or spur growth, with poor prospects for many of the commodities mined and exported. However,...
Real Economy Insight: Automotive 2015 (PDF Report)
Creamer Media’s Real Economy Year Book comprises separate reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, gold, iron-ore and platinum sectors.
Real Economy Insight: Water 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
This Week's Magazine
Black-owned investment holding company Sphere Holdings plans to raise a further R1-billion in the coming months in support of its strategy to become a leading black industrial enterprise, which could ultimately seek a listing on the JSE.
Energy analyst and EE Publishers MD Chris Yelland warned recently against excessive optimism regarding timescales for the proposed construction of new nuclear power plants (NPPs) in South Africa. He was speaking at a Nuclear Roundtable in Johannesburg. “I think we...
Malawi’s Lilongwe Water Board (LWB) is inviting eligible bidders to prequalify for the board’s efficiency improvement works, which will be implemented as part of the E24-million Lilongwe Water Resources Efficiency Programme. LWB CEO Alfonso Chikuni explains that...
CROATIA, AN EU MEMBER BUT NOT A TDCA MEMBER On July 1, 2013, Croatia officially became the twenty-eighth member of the European Union (EU). Despite Croatia’s accession into the EU, it is yet to become party to the Trade, Development and Cooperation Agreement (TDCA)...
The Council for Scientific and Industrial Research (CSIR) has announced that its new Inundu airborne electronics testing, evaluation and training pod had made its first test flight on September 10. The successful flight was undertaken from Lanseria International...