Karpowership SA granted authorisation for Richards Bay floating gas project
SA subsidiary of Turkish company says outcome ‘represents a meaningful turning point in this extensive process’
27 October 2023 - 09:00
UPDATED 27 October 2023 - 14:39
by Denene Erasmus
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Karpowership SA has received environmental authorisation from the department of forestry, fisheries & the environment (DFFE) to proceed with plans to moor floating gas power ships in the port of Richards Bay.
This is the latest development in a drawn-out approval process that has faced many delays spanning more than three years .
The SA subsidiary of Turkish-owned Karpowership said on Friday the outcome “represents a meaningful turning point in this extensive process”.
Karpowership SA was awarded three bids for total contracted capacity of 1,220MW to be provided for 20 years via power ships moored in Coega, Richards Bay and Saldanha in the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) in March 2021.
The RMIPPPP contracts awarded to Karpowership have faced much controversy and legal challenges related to the cost and duration of the projects as well as concerns about their environmental impact.
The granting of environmental authorisation brings the company one step closer to reaching financial close for the Richards Bay project.
As part of its submission for environmental approval of the plant, Bloomberg reported, Karpowership SA bought and donated a game farm to a provincial wildlife authority, Ezemvelo KZN Wildlife.
In exchange for the game farm, Karpowership reportedly said that Ezemvelo KZN Wildlife would not object to its plan for a 450MW gas-to-power ship to be moored in the Richards Bay port.
In an earlier statement, the company said it has reached a biodiversity offset agreement with Ezemvelo “to mitigate residual environmental impacts, by agreeing to implement both estuarine and land-based biodiversity offsets”.
Authorisation is still outstanding for the projects in Saldanha and Coega.
According to Karpowership SA, the environmental impact assessment process for the Saldanha project proposal is in the final decision-making phase by the department.
“With respect to Coega, we continue to work closely and collaboratively with the Transnet National Ports Authority to align on the identified alternative docking location for our powership,” the company told Business Day.
Its environmental approval application for Coega has been rejected twice, partly because there is no longer an agreement with Transnet about the location of the power ships at Coega as a result of the project delays.
Public enterprises minister Pravin Gordhan, said in a written response to a parliamentary question earlier this month that due to the delays the Karpowership SA and other RMIPPPP projects have faced to reached commercial close the department of forestry, fisheries and the environment, as procurer, has communicated a long stop date for the RMIPPP of December, 31.
This means all the projects under this programme will have to achieve legal close by the end of this year or they risked losing grid access that was granted as part of the procurement process.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Karpowership SA granted authorisation for Richards Bay floating gas project
SA subsidiary of Turkish company says outcome ‘represents a meaningful turning point in this extensive process’
Karpowership SA has received environmental authorisation from the department of forestry, fisheries & the environment (DFFE) to proceed with plans to moor floating gas power ships in the port of Richards Bay.
This is the latest development in a drawn-out approval process that has faced many delays spanning more than three years .
The SA subsidiary of Turkish-owned Karpowership said on Friday the outcome “represents a meaningful turning point in this extensive process”.
Karpowership SA was awarded three bids for total contracted capacity of 1,220MW to be provided for 20 years via power ships moored in Coega, Richards Bay and Saldanha in the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) in March 2021.
The RMIPPPP contracts awarded to Karpowership have faced much controversy and legal challenges related to the cost and duration of the projects as well as concerns about their environmental impact.
The granting of environmental authorisation brings the company one step closer to reaching financial close for the Richards Bay project.
As part of its submission for environmental approval of the plant, Bloomberg reported, Karpowership SA bought and donated a game farm to a provincial wildlife authority, Ezemvelo KZN Wildlife.
In exchange for the game farm, Karpowership reportedly said that Ezemvelo KZN Wildlife would not object to its plan for a 450MW gas-to-power ship to be moored in the Richards Bay port.
In an earlier statement, the company said it has reached a biodiversity offset agreement with Ezemvelo “to mitigate residual environmental impacts, by agreeing to implement both estuarine and land-based biodiversity offsets”.
Authorisation is still outstanding for the projects in Saldanha and Coega.
According to Karpowership SA, the environmental impact assessment process for the Saldanha project proposal is in the final decision-making phase by the department.
“With respect to Coega, we continue to work closely and collaboratively with the Transnet National Ports Authority to align on the identified alternative docking location for our powership,” the company told Business Day.
Its environmental approval application for Coega has been rejected twice, partly because there is no longer an agreement with Transnet about the location of the power ships at Coega as a result of the project delays.
Public enterprises minister Pravin Gordhan, said in a written response to a parliamentary question earlier this month that due to the delays the Karpowership SA and other RMIPPPP projects have faced to reached commercial close the department of forestry, fisheries and the environment, as procurer, has communicated a long stop date for the RMIPPP of December, 31.
This means all the projects under this programme will have to achieve legal close by the end of this year or they risked losing grid access that was granted as part of the procurement process.
erasmusd@businesslive.co.za
Updated: October 27 2023
This article has been updated with additional information
Court denies interdict in Karpowership shares battle
Karpowership parent company accused of ‘state capture on steroids’
Karpowership ups game in bid to partner with SA to help ease energy crisis
Karpowership gets nod to try again for environmental approval
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