Coal investment plans aided by Sasol venture - CNBC Africa

Coal investment plans aided by Sasol venture

Southern Africa

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“I certainly would say that we are at a point where we need a total energy plan, which includes a plan for coal, liquid fuels, electricity, it must definitely include a plan for gas. It’s not just a single roadmap that we need for coal although that is very important,” Van der Waal, the business unit leader for energy and power Africa at Frost & Sullivan, told CNBC Africa on Wednesday.

Sasol will launch its Sasolburg Gas Engineer Power Plant on Wednesday. This is after the petrochemicals firm signed a research agreement to explore the potential for underground coal gasification technology to boost the country's energy reserves.

“Coal bed methane is more proven and this can be done in a year or two, companies should be able to start extracting some of that gas. The important thing at this stage is that we start exploring further and look realistically at what is down there and what can we extract without damaging the environment,” said Van der Waal.         

“On a global scale, gas is a really important one. It is a relatively new development with regards to energy sources that can be utilised and specifically the potential for reduction in carbon dioxide emissions. It is really important for us as South Africans to start looking more actively at finding alternative sources of energy.”

South Africa’s total gas reserves stood at 770 billion standard cubic feet in March 2012 and the country is 15th in terms of the most expensive electricity globally according to NUS Consulting’s 2013 International Electricity and Natural Gas and Price Survey report.

Van der Waal said that while coal, the traditional form of energy generation, doesn’t gel very well with renewables, it’s really important for South Africa to look at alternative gas sources such as coal bed methane and shale gas.

“The expansion of the electricity industry will include a lot more renewables than what we currently have. The energy mix in South Africa is changing rapidly. Although we are very excited about the diversification of the energy mix, the reality is that coal will remain our base feedstock,” he said.

He added that it’s essential for local gas companies to get involved in the country’s strategic energy plans.

“It is crucial that South African companies start taking up the opportunity and start exploring and start investing in these opportunities because they will have a major impact,” said Van der Waal.

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