By: Nghiinomenwa-vali Erastus
After being discovered many decades ago, the government and willing investors are finally moving to extract the gas reserves on the southwestern shores of Lüderitz.
It was announced back then that financial investment decisions were to be taken in 2016, however, the steam around the project evaporated and it was not spoken of for years.
The project is now back on the table with plans to use gas to generate electricity by 2026.
In a presentation at the Oil and Gas Conference last week, the country’s Petroleum Commissioner, Maggy Shino provided an update on the Kudu Gas project.
Shino said Kudu is now fully integrated and there are practical steps that have been taken to extract the gas and develop it into electricity (gas to power).
More importantly, to produce the country’s baseload, given the abundant intermittent energy sources, while exporting to the neighbouring countries.
Shino did not give the exact megawatts (MW) expected from the project, but reports have indicated 400MW that can also be romped up to 600MW.
According to the Petroleum Commissioner, all scopes are progressing as the front engineering and designing of the project continues.
At the same time semi-floating production equipment that is required for drilling has been procured, she said.
She updated that the plan is to build a pipeline to bring the gas on shore at the power plant near Lüderitz.
According to the Commissioner, the project is pivotal in providing energy transition solutions.
More importantly, it will be a provider of baseload power, enabling the country to utilise its intermittent renewable energy from independent power producers.
The unavailability of solar, and wind during certain periods has been a risk to the country without substantial baseload to tap on, thus the gas-to-power has now become an option for baseload.
Shino has added further that the gas-to-power project will provide energy security for the region, which mostly depends on hydro energy except for South Africa which has been reliant on coal.
She said the project is not only a sound investment option for both upstream and downstream but is also feasible as it is also backed by existing infrastructures.
Since the project is expected to generate more than the country requires/demands the rest of the power will be exported within the region.
According to the presentation, the gas to power project will be contributing to the national grid by 2026.
Given the excess power, Shino indicated that the key power sales agreement is progressing very well, to have off-takers on board.
One potential off-taker is South Africa which has been battling limited generation issues due to its ailing infrastructures and conundrum on phasing out coal.
The country’s Electricity Minister Kgosientsho Ramokgopa visited Namibia last week and met with Minister of Mines and Energy Tom Alweendo to indicate their interest in procuring the excess energy.
Ramokgopa said the additional megawatts from Namibia will go a long way as part of their efforts to ensure transition and lower the carbon admissions.
South Africa is trying to reduce its utilisation of fossil fuels, moving from coal dependence to power.
Currently, Namibia exports between 10,000 to 48,000MWh to neighbouring countries depending on local generation. Botswana, Angola, and South Africa are some of the clients, as well as the Southern Power Pool.
The Kudu Gas is owned by BW Kudu (95%), while the remaining 5% is owned by Namcor, while Nampower is expected to come in also at the transmission stage.