DNG Energy will accelerate its pilot projects with its partners in coming weeks after receiving a shipment of liquefied natural gas (LNG) at its plant in Germiston.
The groundbreaking pilot projects aim to test the feasibility of using LNG as an alternative to diesel, offering a proof of concept for a cleaner and more affordable option for transport, industrial power generation and mining.
This latest development follows the arrival of South Africa’s first LNG shipment from Rotterdam, Netherlands, in a historic moment for the local energy market. It marks the culmination of seven years of planning, permitting and licensing efforts, and the commencement of an investment programme of some R5 billion over the next several years to ensure bulk affordable and reliable LNG supply.
Speaking at a ribbon-cutting ceremony at the plant, DNG Energy Group chief executive Aldworth Mbalati said yesterday that it had taken the company several years – as well as big investments and the preparation of infrastructure rollout – to get to this point, which marked a new era for South Africa’s energy market.
“We are especially proud that it is a private, 100 percent black African-owned business that is enabling a future where energy is cleaner and more cost-effective than ever,” said Mbalati.
“We’re focusing on transforming South Africa’s energy landscape through the advancement of LNG, which has a key role to play in increasing industrial output and power supply, while reducing greenhouse gas emissions. By driving competition in the energy market, our LNG offering has potential to boost local manufacturing and drive economic growth through the transfer of skills and creation of employment.”
Mbalati said it had been an incredibly tough but fulfilling journey that would serve as a catalyst for a new industry.
In an interview with Business Report, Mbalati said the work done to date had cost around R200 million. This came from own-generated funds made elsewhere and invested here, bank finance and private equity finance sourced abroad.
He said the returns on their investments would not only be in rand value, but also environmental, reducing the country’s carbon footprint, as well as social – in creating jobs – and by being an industry catalyst.
In addition to an abundant energy resource for generating electricity and providing fuel for industrial processes and heating, LNG can be used as a raw material to produce chemicals, fertiliser, and hydrogen. It can also be used in several residential, commercial and transport applications.
The company’s business units include DNG Power, which provides gas-to-power solutions responding to South Africa’s energy needs. It says it supplies secure, cheaper and stable alternative energy, in the form of LNG, in line with the country’s national commitment to transition to cleaner sources of energy to support the economy, while solving the current electricity generation crisis.
The company said it had the rights to import LNG to support the development of power generation capacity as per the country’s IRP, which sought to add more generation capacity by 2030 in order to restore energy security.
DNG Energy will use gas infrastructure comprising pipelines as well as virtual solutions. Underground pipelines meant there was no disruption of supply due to storms or power outages, while virtual solutions ensured that natural gas can reach even far-flung areas where pipelines are not available.
The company said it was actively developing gas-to-power plants in Komatipoort, Malelane, Coega, Mossel Bay and Saldanha Bay. These plants would help provide a solution in delivering gas-powered generation as quickly as possible to serve South African communities’ energy needs.
DNG Smart Gas was championing the use of LNG for road and maritime transport, specifically for the public transport (minibus taxis and buses), logistics (trucks), and shipping sectors.
DNG Marine is a specialist shipping company mandated to collect and deliver LNG to various DNG Energy projects. It would moor its 8 000 ton LNG barge at the Port of Coega in Algoa Bay in the Eastern Cape. The strategically located facility on one of the world’s most travelled trading routes – with 56 000 ships passing through each year – would come online this year, providing commercial vessels access to LNG. Until now, limited infrastructure has been a barrier to adopting LNG as a smart fuel alternative to the shipping industry.
DNG Industrial is a subsidiary of DNG Energy specialising in manufacturing and supplying of cryogenic and industrial gas storage, transport and processing equipment. It supplies mining and industrial consumables, such as piping, fittings, flanges, steel in all grades of material and a range of valves under DNG Steel and Pipe division.
DNG Cryogenics aims to be the preferred supplier of cryogenic and related industrial gas storage, transport and processing equipment in Africa. Their new 2 000 square metre under-roof manufacturing facility in Germiston underpins this endeavour.
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