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African Business 2020 edition

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A unique guide to business and investment in Africa. Global Africa Network is proud to launch this inaugural edition of African Business 2020 at a time of energetic planning for a prosperous future for the continent. The African Union’s Agenda 2063 is much more than a document about a hoped-for future, it contains concrete goals and deliverables. The Programme for Infrastructure Development in Africa (PIDA) and the development finance institution, the African Development Bank (AfDB) are already rolling out valuable projects that are changing the reality on the ground in vital areas of the African economy. Perhaps the most significant event of recent times is the signing by African leaders of the African Continental Free Trade Area agreement (AfCFTA) which will bring together all 55 member states of the African Union and cover a market of more than 1.2-billion people. African Business 2020 has articles on all of these recent trends, plus overviews of the key economic sectors and regional and country profiles. In 2019 Ethiopian Prime Minister Abiy Ahmed received the Nobel Peace Prize for peace-making efforts in his region. The economic dividends of peace are beginning to be felt. In 2020 South African President Cyril Ramaphosa assumed the mantle of AU Chairperson. He brings to the role considerable experience in conflict management, constitution-writing and seeking consensus. Global Africa Network is a proudly African company which has been producing region-specific business and investment guides since 2004, including South African Business and Nigerian Business, in addition to its online investment promotion platform www.globalafricanetwork.com

Gwede Mantashe, Minister

Gwede Mantashe, Minister for Mineral Resources and Energy at Africa Oil Week 2019, talking to Sandisiwe Ncemane, CDC Project Development Manager: Energy. Photo: Supplied First LNG hub in SA to be established at Coega Coega SEZ is ready to welcome investors to its shores for gas opportunities In his speech at Africa Oil Week 2019, Minister for Mineral Resources and Energy, Gwede Mantashe, urged investors to pursue investment opportunities in the proposed liquefied natural gas (LNG) hub at the Coega Special Economic Zone (SEZ) in the Eastern Cape. “The call by the minister is certainly in line with the various activities the Coega Development Corporation (CDC) has been undertaking in the past couple of years to advance its gas readiness capabilities,” says Sandisiwe Ncemane, CDC Project Development Manager: Energy. “Within the next couple of weeks, the CDC will be engaging various stakeholders, both within the private and public sector, and inviting them to the Coega SEZ for a tour of the proposed sites and to update them on progress thus far,” says Ncemane. With an established market for LNG within Coega, over the years, the CDC, in collaboration with the Eastern Cape provincial government, has put in place extensive gas market analysis and preparation to enhance Coega’s readiness for the implementation of high impact energy programmes towards an integrated gas economy. “The AFRICAN Coega BUSINESS SEZ is one 2020 of the most advanced in terms 2 of preparations for the LNG hub and is the ideal location for the associated gas to power programmes. One of the critical game changers for the CDC is the cost factor. The 342MW Dedisa Peaking Power Plant currently in operation within the SEZ has existing environmental authorisation for a 400KV transmission line between the plant site and the Dedisa substation, which reduces the costs of the gas to power project for investors quite significantly,” adds Ncemane. Another factor is that the CDC, as early as 2006, undertook five environmental impact assessment (EIA) studies supporting the gas to power solution. “EIA studies were concluded for rezoning of land in the SEZ, the establishment of a 400KV transmission line between the plant site and the Dedisa substation, and the marine pipeline servitude EIA, which is currently underway. “Further, the 2015/16 department of mineral resources and energy and Transnet feasibility studies include the LNG terminal at the Port of Ngqura, identifying several berth options for its deep water seaport adjacent to the Coega SEZ. As part of the Coega environmental studies, in 2019, a draft scoping report was prepared for an integrated LNG terminal and gas to power solution at Coega,” adds Ncemane. “We are also encouraged by the recent comments

attributed to Transnet’s chief business development officer, Gert de Beer, on Transnet’s support and commitment of resources to the LNG hub intended for Coega,” says Ncemane. The Coega SEZ has world-class infrastructure; it has prime and serviced land that is available to host key gas-to-power projects with spin-offs for other sectors. In addition, the approved Coega Infrastructure Master Plan is in place. It defines the services corridor from the LNG project site to Dedisa substation as well as good access via the National Road (N2) and ancillary road network. The short-term outlook is to import liquefied natural gas to trigger the gas economy, which would stimulate the exploration and production of indigenous gas resources in the Eastern Cape. The case for the Eastern Cape The significance of the Eastern Cape is that it is endowed with the possibility of both onshore and offshore gas, gas-driven power generation, and gas importation, handling, transshipment infrastructure as well as industrialisation. Potential recoverable quantities of indigenous natural gas are in the order of 20-trillion cubic feet onshore (shale gas), and 26-trillion cubic feet offshore. The recent deep water drilling in Brulpadda (approximately one billion barrels) in the Southern Outeniqua basin could potentially unlock enough fuel to supply South Africa’s refineries for almost four years. It has the potential to unlock a value chain of marine maritime services located at Coega SEZ, which could in turn trigger opportunities eastwards and small harbours along the Wild Coast. In line with South Africa’s developmental programme, indigenous gas extracted in this province must be beneficiated within the country’s shores, maximising the economic benefit yield within the region. The Eastern Cape, through the department of economic development, environmental affairs and tourism (DEDEAT) has provided various gas support initiatives organised in a coherent framework and is well positioned to drive enablers for a gas economy. DEDEAT has initiated a strategic framing process for the provincial oil, gas and maritime complex, which has provided much impetus, clarity and support for the socio-economic development of the gas industry. At the Coega SEZ, within the energy sector, there are a multitude of operational investors, as a demonstration of the hard work, efforts and opportunities available in the Eastern Cape. Some of the projects include: • Dedisa Peaking Power Plant (Zone 13) – the 342MW Peaking Power Plant, located in the Coega Special Economic Zone, is a R3.5-billion foreign direct investment. The project has been operational since September 2015 and created around 1 500 jobs during its construction phase. • Wind Tower Manufacturing (Zone 3) – wind tower assembling plant, a R310-million investment located at the Coega SEZ, which created 390 jobs during construction. • Lay Down Area (Port precinct / Zone 1) – abnormal cargo related to the Renewable Energy Power Producer Procurement Programme (logistics). This is a R9-million investment that has contributed to the distribution of wind turbines throughout the EC. • A Renewable Energy project – The first commercial wind turbine in South Africa, valued at R1.2 billion. In the 20 years since its establishment in 1999, the Coega SEZ has become one of the leading SEZs in Africa, as a gateway to African and world markets, a transshipment hub and Southern Africa’s most successful SEZ. To date, the CDC has delivered on its mandate to provide socio-economic development for the Eastern Cape, by enabling the creation of over 120 000 accumulative jobs since inception, with 45 operational investors, who have invested R11.579-billion in private sector investment and R9.53-billion in foreign direct investment. The CDC has also trained over 100 000 people since its inception. For investors who wish to take advantage of opportunities in the energy sector, please contact, Sandisiwe Ncemane on: E-mail: sandisiwe.ncemane@coega.co.za Telephone: +27 41 403 0630 Fax: +27 41 403 0401 CELEBRATING “In the broader perspective, the LNG hub at the Coega SEZ is perfectly located as it opens up a gas corridor 1999-2019 towards the East and West coasts, and is a response to the recently gazetted South African Integrated Resource Plan (IRP2019), which makes provision for additional www.coega.co.za 3 AFRICAN BUSINESS 2020 1 000MW gas driven power by 2024,” adds Ncemane. ISO 20000-1:2011 ISO 27001:2013 OF EXCELLENCE ISO 9001:2015 ISO 14001:2015 ISO 45001:2018

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