Bulk liquid storage operator Bidvest Tank Terminals’ (BTT’s) R1-billion mounded liquefied petroleum gas (LPG) storage facility in Richards Bay, KwaZulu-Natal, is set to house the largest tanks in the world and is expected to greatly enhance LPG supply in Southern Africa once completed, the company has indicated.
The facility will store LPG on behalf of independent LPG specialist Petredec, which ships the fuel from the US and the Middle East. LPG is produced as a by-product in the oil refining process.
Petredec sought an import facility specifically on South Africa’s East Coast, and Richards Bay was seen as the most suitable port to handle this capacity. Being able to receive larger shipments also makes product handling more cost effective, reducing overall logistics costs.
The port is also on Petredec’s shipping route and in close proximity to the main rail and road logistics routes going inland, particularly as most of the LPG will be used in Gauteng, the Free State and the North West. This logistics infrastructure is also of high quality.
The project, currently under construction, was initiated at the end of 2017 and is slated for completion in July 2020. It is expected to increase LPG supply in South Africa by 200 000 t/y, half the country’s current consumption of about 400 000 t/y.
Replacement Energy Source
BTT and Petredec are confident that there is demand for LPG, BTT MD David Leisegang tells Engineering News.
The companies believe that the greatest demand will stem from LPG’s use as a replacement energy source, such as a substitute for wood or paraffin for heating and cooking. The use of these energy sources is still quite prevalent in South Africa, especially in informal settlements and areas where there is not any reliable access to electricity.
Leisegang emphasises that the health benefits of LPG are “considerable”, compared with the energy sources mentioned, as are its safety credentials, as “many of the fires in informal settlements are [the result of] cooking with these sources of fuel”.
LPG has been identified by the World Bank as the most environment friendly of all fossil fuels; therefore, the facility is expected to assist in providing a viable, reliable, safer and more environment- friendly energy alternative.
The facility can handle imports of more than 300 000 t/y, which Leisegang argues will assure LPG availability in Southern Africa.
BTT has indicated that reliable supply is one of the biggest obstacles to increasing LPG use in the country, with the new facility expected to resolve this.
An increased, secure supply will result in LPG becoming a significant alternative to the country’s current energy supply, with no additional infrastructure required.
Leisegang notes that, in addition to supplying its major gas company clients, Petredec will target local cylinder fillers and bottlers. South Africa has experienced periods of considerable LPG shortages, and this has hampered the development of small entrepreneurial bottlers.
BTT and Petredec believe that an unconstrained supply of LPG, enabled by the facility, will, therefore, lead to the development of a number of small bottling entrepreneurs.
The companies are hopeful that there will be positive growth in the downstream industry, leading to a knock-on effect in job creation: end-to-end LPG supply requires a vast national value chain, which the commissioning of this facility will stimulate.
The increased and sustainable supply will mean that the price of LPG will compete favourably with the price of other energy sources, thereby engendering a cost-effective energy source for clients.
Moreover, as the largest facility in Africa, this terminal will facilitate exports of LPG to neighbouring countries, including Botswana, Zimbabwe and Zambia.
The facility will comprise four 5 650 t mounded tanks, each 60 m long and 16 m in diameter, with an internal volume of 10 712 m3, the largest mounded LPG storage tanks in the world.
The combined LPG storage facility capacity will equate to 22 600 t at any time.
Mounded, rather than unmounded, storage tanks are being used, mainly for safety reasons. Leisegang explains that mounded tanks are positioned on above-ground foundations, but are then buried in sand, which is retained around the tanks using precast concrete walls, with only the manholes and tank nozzles protruding.
The mounded design reduces the risk of fire or explosion significantly, while the risk of a boiling liquid expanding vapour explosion is negated, as there can never be a fire below the tanks.
Moreover, the design also allows for the tanks to be positioned much closer together, reducing the facility’s footprint and resulting in better use of land, which is rented from State-owned Transnet National Ports Authority.
The mounded tanks are being fabricated by a company in Zhongshan, China, as South Africa does not have a facility capable of fabricating vessels of this size, says Leisegang.
The steel for the tanks was fabricated by steel products provider Dillinger, in Germany, after which the material was shipped to China for the manufacture of the tanks.
However, Leisegang indicates that the project boasts a considerable localisation footprint, with the ancillary work surrounding the tanks being done locally, bar the equipment that is not locally manufactured, such as certain pumps and valves.
The LPG product will arrive in pressurised carriers, typically in unmixed form, with separate constituents of butane and propane. BTT is also constructing a new 12-inch pipeline for these two liquids to be pumped from a ship to the storage tanks.
The pipeline will allow for a product pump rate of about 600 metric tonnes an hour.
While the storage tanks are technically pressured bullets, BTT will apply chilling at between 2 ºC and 5 ºC, Leisegang notes. This contracts the LPG, enabling BTT to fit more product into the tanks. He indicates that the benefits of maximising storage outweigh the cost of chilling.
Further, all the valves and pumps are fully automated and remotely controlled from an on-site control room.
The site will contain four loading bays for the transporting of LPG by road, with weighbridges located on the route to increase efficiency. The bays will also be equipped with firewater deluge systems.
There will be two rail loading gentries that will both be equipped with weighbridges and firewater deluge systems.
The rail and road tankers will be filled with LPG continuously. LPG will then be transported across Southern Africa.
Meanwhile, Petredec has been delivering LPG to Africa since the 1980s and has its own 15 000 t import and storage facility in Mauritius, alongside an LPG marketing business on Reunion Island.
Petredec already supplies most of South Africa’s imported LPG and the company believes that further investment in large, dedicated infrastructure is the only way to increase the fuel’s popularity and lower prices for clients.
“Our commitment to the development of the Southern African LPG market underlines our confidence in the growth potential of this region,” commented Petredec CEO Giles Fearn in a statement released in October 2018.
The new facility is expected to complement Petredec’s existing Mauritius facility. A shipping vessel, a very large gas carrier, will be used to transport LPG from either the US or the Middle East, and unload product at Mauritius and Richards Bay.
Meanwhile, BTT celebrated the start of construction of the facility in October last year with a sod-turning ceremony held on site. Leisegang says construction is progressing well, with the piling, tank foundation slabs and tank cradles having been completed.
Moreover, arrangements for the use of Berth 306 at the Richards Bay Coal Terminal to offload the tanks for transport to the facility have been finalised and route preparation is in progress.
In China, the fabrication of the four tanks is nearing completion, with confirmation of the completion date, end-July, received this month. The tanks will be shipped directly from China to Richards Bay, and are expected to arrive within four to six weeks.
The construction phase of the project has created about 130 short-term jobs, while about 20 permanent jobs will be created by the facility.