Western Cape Business News

Send  Share  RSS  Twitter  24 Jul 2011

DEVELOPMENT: Political Windfalls For Saldanha


Recent Western Cape Business News

ONE result of the recent local government elections which has not attracted much attention is the outcome in Saldanha where the DA won an outright majority. The ANC previously controlled Saldanha.

The result is significant because it should lead to an improvement in relations with both the Provincial Government and the City Council. That in turn should lead to more co-operation and a co-ordinated approach to the development of an industrial development zone in Saldanha.

The economic benefits in terms of growth and job creation could be of great importance for the province as a whole.

The Cape Chamber of Commerce says it believes that the port of Saldanha has significant potential to take some of the pressure off the Port of Cape Town which has limited space for expansion.

Saldanha, on the other hand, has deep water and the space to develop industries such as ship repair and the maintenance and repair of the oil rigs operating off the West Coast of Africa.

Other major projects for the area include the development of a huge rare metals industry plant to refine titanium oxide mined at the nearby Namakwa Sands and ‘green industries’ which would manufacture wind turbine blades and solar panels.

There’s also new hope for the proposed Industrial Development Zone for Saldanha. What makes it different from other similar proposals in South Africa is that the investors are queuing up and poised to invest billions of rands in a range of ground-breaking green projects.

This became clear at a symposium organised recently by the Cape Chamber attended by business people from the Saldanha area and Cape Town.

Some of the investors have already spent many millions of rands on feasibility studies and say they are excited by the potential and are eager to go ahead with the next stages of their projects. Many of these will create thousands of jobs in the construction phase and thousands more operating jobs when the industries get going. All they are waiting for is a green light from officialdom.

The potential investors have formed themselves into a ‘clean tech’ consortium and are promising world class green developments.

One industry, Bio Solar, plans to make enough bio gas (methane) in sea water ponds to replace the expensive LPG which Saldanha Steel is using at present.

The ponds, which could be 100 hectares or more in extent, would be used to grow algae which would be harvested to make the methane gas. The ponds would be fed with carbon dioxide from Saldanha Steel to accelerate the growth and earn carbon credits at the same time.

Algae has a growth rate 25 times that of maize and producing fuel from algae will be efficient, sustainable and avoid the argument against using food crops for energy.

A similar plant in Germany has proved viable despite the fact that it enjoys only 200 days of sun a year. On the West Coast the prediction is 365 sunny days a year.

The ponds will also produce organic fertilizer and the water returned to the sea will be cleaner than the original pond water.

A second project, planned by Isuvungu-vungu, will make 50-metre blades for giant wind turbines. Delegates to the symposium were told that the first blade could be produced in six months and from then on at the rate of one a week from each mould. The company was looking at an output of 600 blades a year and said this would create jobs for between 75 and 100 skilled and semi-skilled workers.

The blades are made from fiber glass and other composite materials and would no doubt extend the skills base developed for Cape Town’s world-class yacht-manufacturing industry.

Transporting the 50-metre blades is a major undertaking and the proximity to a deep water port will be a huge advantage.

The biggest project, however, is a Rare Metal Industries plan to refine titanium and zirconium from Namakwa Sands north of Saldanha. South Africa has the world’s biggest reserves of zirconium and the second largest reserves of titanium. At present these products are exported in a raw form but Rare Metals says beneficiating just three percent of the titanium would create a multi-billion dollar a year industry.

The quality alloys which could be produced are in great demand for high tech industries such as the manufacture of turbines for jet engines.

The IDZ consortium wants to produce its own electricity and the Dutch firm Aeolus has come up with a plan to produce1060 MW of base load power from gas and renewable solar and wind resources. A grid independent of Eskom is planned for the R15.5 billion project and the price of the electricity will be lower that Eskom tariffs.

Aeolus plan to use coal gas initially and then imported LPG for two 360MW combined cycle power plants with the remainder of power coming from wind, solar and biomass sources.

Also on the cards is an LPG terminal to supply imported gas to a growing customer base. This is a project planned by Sunrise Energy, a BEE company which believes that the demand for LPG will grow substantially in the years to come.

They point out that using gas for heating and cooking is very much more efficient than electricity where 75% of the heat energy generated in power stations is lost in waste heat, cooling and the long transmission lines.

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