Johannesburg-listed Sasol will take a lead role in a major green hydrogen development in South Africa’s Northern Cape province that has been designated as a strategic project by the government.

The company has signed a memorandum of agreement (MoA) with the Northern Cape Economic Development Agency to lead a feasibility study to explore the potential of the Boegoebaai scheme to become an export hub for both green hydrogen and ammonia.

This study is expected to take about 24 months, with the results determining the next step of any development.

Boegoebaai has been designated a Strategic Integrated Project by the government and is located in the Namakwa Special Economic Zone.

Boegoebaai – about 60 kilometres north of Port Nolloth on South Africa’s Atlantic seaboard – has been earmarked to be developed as a deep-water harbour at a cost of 13 billion rand ($860 million).

As well as serving as an export outlet for the province’s mining and agriculture sector, it could also export green hydrogen generated mainly by nearby solar and wind facilities.

New export facility: Boegoebaai - located 60 kilometres north of Port Nolloth - is a proposed new port in Northern Cape province, South Africa Photo: Image NORTHERN CAPE ECONOMIC DEVELOPMENT AGENCY

The government estimates that about 60,000 hectares of well irradiated land adjacent to the proposed port site would support solar and wind farms with a total capacity of 30 gigawatts, plus 5GW of electrolysers.

Commenting on Sasol's move, Priscillah Mabelane, executive vice president for energy, said: “We are very excited to be leading this feasibility study as part of unlocking South Africa’s potential to be a global green hydrogen and green ammonia export player with the potential for sustainable aviation fuels in the future.”

“This will also be anchored by local demand for green hydrogen (and) is a tangible step forward for Sasol, as we seek to play a leading role in establishing the southern Africa green hydrogen economy.”

According to Mabelane, “southern Africa is well positioned” to play a key role in the global green hydrogen economy due to key structural advantages such as Sasol’s proprietary Fischer-Tropsch (FT) technologies and the region’s renewable endowments which “are some of the best in the world.”

FT is a process that converts coal and natural gas into liquid hydrocarbons and a variety of chemicals and which can also use hydrogen and carbon dioxide as alternative feedstocks.

“There is potential to create an ecosystem anchored on localisation to enable long-term, sustainable benefits for communities and the country, said Mabelane, adding that Boegoebaai “has the potential to provide a significant number of long-term sustainable jobs, infrastructure investment and skills development in the country, enabling a just transition.”

She said that, as Boegoebaai’s lead project integrator, “Sasol will bring together strategic partners along the value chain and other enabling role players that will drive industrialisation of the Northern Cape,” including potential customers, funders, investors, technology suppliers and South African green energy providers.

Boegoebaai is one of a number of green hydrogen, ammonia and power-to-X (P2X) opportunities, which Sasol is assessing as part of the new strategy announced at its recent capital markets day.

Broadly speaking, P2X schemes aim to convert surplus electricity generated by renewables into heat, hydrogen or synthetic fuels.

Sasol said its decarbonisation strategy is aligned with the South Africa government’s ambition to establish the country as a significant green hydrogen production and global export hub.

Sasol has been engaging with the Infrastructure & Investment Office of the President to develop a hydrogen economy in South Africa.

Separately, the company said it has signed a MoA with Gauteng’s provincial government to leverage special economic zones that have been earmarked as enablers to unlocking South Africa’s green hydrogen market potential for domestic use, such as mobility and aviation.

In addition, Sasol has partnered with the state-owned Industrial Development Corporation who will provide joint funding for the feasibility study.

Sasol has committed to be net zero by 2050 and sees green hydrogen as core to enabling this goal.

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