Tag: energy

Zuma signed Russian nuclear deal

President Jacob Zuma personally negotiated with Russian President Vladimir Putin to have Rosatom State Atomic Energy Corporation build nuclear power stations worth R1-trillion in South Africa, the Mail and Guardian reported.

According to the report, President Zuma had started the process directly with Putin at July’s Brics summit in Brazil and then finalised the details of the nuclear pact during his surprise trip to Moscow last month.

The Mail and Guardian quoted a senior ANC leader and a well-placed ANC MP as its sources.

The ANC members said that President Zuma had instructed Energy Minister Tina Joemat-Pettersson to sign the deal with the Russians at the International Atomic Energy Agency (IAEA) conference in Vienna.

The president told his trusted ministers and MPs of the deal.

The nuclear R1-trillion deal was announced on Monday by both Rosatom and the department of energy. The department though has since said the the deal had not yet been finalised.

Minister Joemat-Pettersson has been summoned to appear before Parliament’s energy portfolio committee.

The Democratic Alliance has called for the details of the deal to be made public in order to try and exploit it politically.

Nuclear trumps shale and gas

The signing in Vienna – at the margins of the 58th session of the International Atomic Energy Agency General Conference – of a strategic nuclear partnership between Russia and South Africa, has met with criticism from the mining sector.

The agreement lays the foundation for a large-scale nuclear power plant procurement and development programme of South Africa based on the construction of new nuclear power plants with Russian VVER reactors with a total installed capacity of up to 9,6 GW or 8 units.

These will be the first based on the Russian technology to be built on the African continent.

The signed agreement provides for comprehensive collaboration in other areas of nuclear power, including the construction of a Russian-technology based multipurpose research reactor, assistance in the development of South African nuclear infrastructure, and education of South African nuclear specialists.

The creation of new highly-skilled workplaces will also allow South African companies to further participate in Rosatom’s projects in third countries.

South Africa’s industry will become dependent on sources other than shale and coal, critics say. While industry and certain role players obsess about shale and gas, Mozambique’s gas resources will also need expensive infrastructure.

The questionable benefits that shale gas might offer, will be short-lived, unlike nuclear.

This agreement would naturally limit South Africa’s importation of energy from Namibia or Mozambique.

Also, this will probably mean an end to preferential electricity contracts that offer power at a rate far below the level other industrial users pay, to companies like BHP Billiton.

The R9,5bn lost in embedded derivatives, as reported by Eskom, is the cost of the remaining time on these preferential electricity contracts, some of which still have years to run.

Other energy sources will be hydroelectric power from the future Inga III dam in the Democratic Republic of Congo.

South Africa’s nuclear power ambitions had attracted several proposals.

French group Areva, which built South Africa’s only nuclear plant at Koeberg, had proposed to provide the country with its new generation of EPR reactors.

Government had also solicited an offer from the US-Japanese group Westinghouse.

Brazil, Angola strengthen strategic partnership

Brazil offers Angola new credit line worth $2-billion

Brazil has offered Angola a new credit line worth $2-billion for use in the sub-Saharan African country’s energy and construction sectors, Angolan Finance Minister Armando Manuel said on Monday.

Several Brazilian companies are involved in energy and construction in Angola, Africa’s No. 2 oil producer, although China is the main foreign partner and buys nearly half of Angola’s oil.

Angolan President Jose Eduardo dos Santos, on a state visit to Brazil, was due to meet Brazilian President Dilma Rousseff later on Monday to discuss moves to strengthen a strategic partnership between the two Portuguese-speaking countries that began in 2010.

Angola is spending billions to rebuild transport, energy and communication networks destroyed by a 27-year civil war that ended in 2002.

This would be the sixth credit line extended by Brazil.

“The new line raises the total to $7.83-billion, which makes it clear that there is a growing link between the two countries,” Manuel said in comments broadcast by Angola state TV network TPA.

China has given an estimated $13.4-billion in so-called ‘oil-for-infrastructure’ loans to Angola. As a result, Chinese construction companies are heavily involved in the reconstruction projects.

Still, Brazil’s Odebrecht, Latin America’s biggest diversified construction conglomerate, which is engaged in the construction and agribusiness sectors, is Angola’s biggest private employer.

The US also has a strategic partnership with Angola, which the two parties are trying to strengthen.

The US-run Export-Import Bank this month financed a deal for Angola to buy $1-billion of railway and energy equipment from General Electric.

 

Sasol axes shady BEE partner

sasol2Petrochemical giant Sasol has pulled the plug on a shady empowerment deal with union boss Simon Mofokeng and wife Maureen after Business Times exposed how they used fake documents to clinch contracts worth over R300-million.

But this still leaves questions unanswered, including how Sasol could have done business with Mofokeng’s company for 13 years before uncovering the deception.

Sasol confirmed this week it would report a case of fraud to the police, which means the Mofokengs are likely to face charges along with their financial director, Vusani Moyo.

Simon Mofokeng is the general secretary of Cosatu-affiliated Ceppwawu (Chemical, Energy, Paper, Printing, Wood and Allied Workers Union) – a serious conflict of interest, as Ceppwawu has a major presence at several of South Africa’s top listed companies, including Sasol.

Sasol, which is listed on the JSE and the New York stock exchange, said on Wednesday it had cancelled its coal-handling contract with Khotso Batho “with immediate effect” for issuing “fraudulent letters of good standing to Sasol”.

“Sasol is not immune to corruption, but in instances such as this, where acts of fraud are identified, we will act swiftly and decisively,” said Sasol CEO David Constable.

The scandal has also sparked a major overhaul of Sasol’s procurement processes to make it harder for contractors to get away with fraud. It also launched an internal probe into the role of Sasol staffers, including the likelihood that they had failed to act against Khotso Batho despite being given evidence of wrongdoing.

“Any member of staff found to have knowingly facilitated a corrupt or noncompliant relationship with this service provider will face disciplinary action,” said Constable.

Well-placed sources told Business Times previously that Mofokeng had enjoyed a close relationship with Sasol top brass, including former Sasol Mining MD Hermann Wenhold, who is now group safety manager.

Sasol declined to confirm whether Wenhold or other senior executives were under investigation.

A three-month investigation by Business Times previously exposed how Mofokeng used his influence as a union boss to extort special treatment for his company from Sasol, which renewed its contract twice even though it failed to comply with its procurement rules.

These included needing a tax clearance certificate and letters of good standing from the labour department proving Khotso Batho was up to date with payments to the government’s compensation fund.

Mofokeng earned a salary of R130 000 a month as a Khotso Batho executive while employed as a full-time Ceppwawu office bearer, even though the union does not ordinarily allow its salaried top brass to hold paid outside employment.

Business Times established that Khotso Batho owes the SA Revenue Service at least R22-million in unpaid taxes, has failed to produce audited financial statements in the last three years, and is up to a year behind in submitting its VAT, PAYE and UIF returns.

It has been in arrears with the compensation fund since 2001. – timeslive.co.za

Bright future for SA with shale and solar: Mothlanthe

oilshaleSouth Africa can become one of the fastest-growing economic hubs in the world if it exploits its natural resources, Deputy President Kgalema Motlanthe said on Monday.

 

“Fortunately for South Africa, we have among the best solar energy resources in the world, in addition to coal, which makes it logical for us to pursue the exploitation of photovoltaic technologies,” he said.

 

“In addition, we have abundant shale gas resources, the commercial exploitation of which we have to investigate and pursue.”

 

Speaking at the Green Economy National Youth Summit in Cape Town, Motlanthe said the country’s uranium deposits were too sizeable to ignore from a beneficiation perspective.

 

“If this is coupled with the potential for regional interconnection within the Southern African Development Community sub-region, we have the potential to be one of the fastest-growing economic hubs in the world.”

 

He said the focus would be on environmentally balanced and sustainable energy resources.

 

Motlanthe listed some of the options available to ensure the country’s energy security while adding economic benefits.

 

One of these was solar power, which held “enormous potential” for regional development in the Northern Cape.

 

There was also potential for “positive economic spin-offs” from the accelerated exploration of shale gas in the Karoo, as well as from diplomatic efforts to harness the natural gas discoveries in Mozambique and Tanzania.

 

Another option was the pursuit of a knowledge economy through the beneficiation of uranium, and a nuclear programme.

 

He said heavy reliance in the past on coal as an energy source had resulted in limited rural development.

 

“[It has resulted in] skewed economic development, with the urban areas and the coalfield areas enjoying better infrastructure, while other rural areas have yet to attain access to modern energy carriers,” he said.

 

The country had since adjusted its energy objectives to ensure diversified sources, security, cost minimisation, increased access, reduced emissions, water conservation and localisation of energy value chains.

 

“Accordingly, our energy planning framework seeks to maximise the economic benefits of our electricity, gas and liquid fuels infrastructure development programmes, [while] at the same time… meeting the other set objectives.” – SAPA

Japan burning ice

A flame ripples from a burner on the back of a deepwater drilling rig in the Pacific Ocean off the southern coast of Japan, heralding an energy breakthrough for a power-starved nation.

Japan announced on March 12 that it had extracted natural gas at a depth of 3,280 feet (1,000 meters) from one of the most mysterious and vast reservoirs of fuel on Earth—methane hydrates, which are methane molecules trapped in ice crystals. The successful foray by the drill ship Chikyu marked the first time ever that natural gas had been produced from offshore methane hydrates, known as the “ice that burns.” Japan hopes that the test extraction is just the first step in an effort aimed at bringing the fuel into commercial production within the next six years.

That’s a far faster timetable than most researchers have foreseen, even though there is wide agreement that the methane hydrates buried beneath the seafloor on continental shelves and under the Arctic permafrost are likely the world’s largest store of carbon-based fuel. The figure often cited, 700,000 trillion cubic feet of methane trapped in hydrates, is a staggering sum that would exceed the energy content of all oil, coal, and other natural gas reserves known on Earth. (See the U.S. Department of Energy’s primer on methane hydrates.) But under high pressure and at low temperatures, the methane molecules are locked in lattice-like cages of frozen water—a kind of host/guest relationship called a “clathrate.”

Because methane is a gas with high global-warming potential—25 times more potent than carbon dioxide in trapping heat in the atmosphere—there is great concern over uncontrolled release of the methane from hydrate formations. Yet methane also can help cut carbon emissions when it is burned instead of coal for electricity. The U.S. government, which has a major methane hydrate research program, last year even sought to test a method for extracting methane and sequestering carbon dioxide at the same time.

But perhaps no nation has conducted as much methane hydrate research as Japan, which until now has had virtually no exploitable domestic fossil fuel resources. The nation’s reliance on foreign gas imports has surged since the 2011 Fukushima Daiichi disaster, which has led to the idling of nearly all 54 nuclear power plants that once provided 30 percent of Japan’s energy. In light of the nation’s energy woes, the methane hydrate milestone 50 miles (80 kilometers) off the coast of Aichi Prefecture in central Japan was especially significant. “Japan could finally have an energy source to call its own, ” said Takami Kawamoto, spokesman for the Japan Oil, Gas and Metals National Corporation (JOGMEC). – National Geographic