Oct 29, 2010
Power connectivity rules have changeBack
London|Africa|CoAL|Eskom|PROJECT|Projects|Resources|Xstrata|Africa|South Africa|Electricity Supply|Energy|Energy Consumption|Energy Initiatives|Energy-intensive Projects|Less Electricity|Mining|Peet Nienaber|Power|Mpumalanga|Premus Technology
© Reuse this
It is also arguably indicative of just how difficult it is going to be for mining businesses to align themselves with government’s mineral beneficiation policy aspirations.
Unlike previous beneficiation projects, when electricity supply was a given and it was merely a matter of securing the best price, the Xstrata-Merafe chrome venture was forced to undertake various energy initiatives to unblock the expansion project – a 360 000 t/y smelter that will increase Xstrata-Merafe’s total ferrochrome capacity to more than 2,3-million tons a year.
Firstly, it had to prove that it was doing all it could to reduce its energy consumption. Much of this was achieved through the deployment of its proprietary Premus technology, which consumes about one-third less electricity than other available smelting technologies – an industry leading average of 2,2 MW/t to 2,4 MW/t. It also introduced pelletising, which has reportedly improved overall efficiency, and committed to a range of other energy-saving endeavours.
But in order to secure a supply agreement from Eskom, Xstrata will also augment this grid supply through own generation. The company is studying the exploitation of discard-coal opportunities at its Tweefontein mines, which could eventually deliver 600 MW. This generation capacity could be built using four off-the-shelf modules of 150 MW each.
In announcing the project, Xstrata Alloys CEO Peet Nienaber even argued that the project was aligned with South African’s draft integrated resource plan 2010, owing to its energy efficiency and the use of electricity to create sus- tainable jobs.
Before reaching this point, the project had been marking time, while a firm Eskom power allocation was being negotiated.
Things have certainly changed since the days of those first smelter agreements.
Edited by: Terence Creamer© Reuse this Comment Guidelines (150 word limit)
Other Editorial Insight News
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 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 network, the funding and maintenance of these respective networks, and the push to move road...
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.
This Week's Magazine
In the next 20 years, it was expected that, in Africa, more people would live in cities and towns than in rural areas, United Nations Habitat executive director Dr Aisa Kirabo Kacyira said at the Human Settlements Indaba that took place earlier this month in...
Tough-talking Human Settlements Minister Lindiwe Sisulu has committed government to building 1.5-million low-cost houses over the next five years, telling the Human Settlements Indaba in Johannesburg on Wednesday that the State would achieve this target through the...
Over the past 20 years there has been persistent concern about deindustrialisation in South Africa, as well as the fact that locally produced manufactured products have been increasingly displaced by imports.
Financial agreement for Ghanian independent power producer (IPP) Cenpower Generation Company’s $900-million, 350 MW combined-cycle gas-turbine power plant was finalised earlier this month, paving the way for the project’s construction to begin before 2015 in Tema,...
The revenue implications for South Africa of ‘base erosion and profit shifting’ by corporate taxpayers are firmly in the crosshairs of the Davis Tax Committee (DTC) and Judge Dennis Davis hinted last week that recommendations were being considered to “detect and...