[Durban, South Africa, 26 February 2025] Zululand Energy Terminal (ZET), a joint venture between Vopak Terminal Durban and Transnet Pipelines (TPL), achieved a historic milestone on 10 February 2025, by signing the Terminal Operator Agreement (TOA) with Transnet National Ports Authority (TNPA). This agreement grants ZET the rights to develop and operate South Africa’s first Liquefied Natural Gas (LNG) import terminal at the Port of Richards Bay for a period of 25 years.
With exclusive land rights secured, ZET can now advance binding agreements with potential customers, supported by an ongoing capacity allocation process. A final investment decision is expected in 2026, contingent on timely customer commitments.
“Vopak’s global expertise in LNG infrastructure, combined with our strong partnership with Reatile Group and Transnet Pipelines, positions us to deliver a world-class terminal in Richards Bay. This project aligns with Vopak’s vision to expand in industrial and gas terminals, providing reliable and sustainable energy solutions for South Africa”, said Oliver Naidu, President of Vopak South Africa and ZET Project Owner.
The LNG terminal is a strategic initiative to enhance South Africa’s energy security as the country faces a looming “gas cliff” and the gradual decommissioning of coal-fired power stations. It will support flexible power generation, drive industrial growth in KwaZulu-Natal and beyond, and benefit industries connected to the Lilly Pipeline, owned by TPL. The project is set to generate employment, stimulate local business activity, and attract investment, reinforcing economic resilience.
Designed to serve multiple sectors, including power generation, manufacturing, and transportation, the terminal will provide a stable energy source to facilitate long-term industrial development. It is also expected to enhance the Richards Bay Industrial Development Zone (RBIDZ) as a key economic hub.
The project will be executed in two phases:
- Phase 1: Establishing a Floating Storage Unit (FSU) with a capacity of 135,000-174,000 cubic meters, onshore regasification infrastructure handling ~400 mmscfd, and optional truck loading facilities. A new pipeline connection will link the terminal to the Lilly Pipeline via Empangeni, with a tie-in point for RBIDZ customers.
- Phase 2: Developing an onshore storage tank with a capacity of up to 220,000 cubic meters, replacing the FSU. This phase will expand send-out capacity to ~600 mmscfd, supporting planned Gas-to-Power projects in Richards Bay and future gas users nationwide.
“This agreement marks a major step forward in South Africa’s energy transition. At Transnet Pipelines, we are committed to developing essential midstream infrastructure to facilitate cleaner energy solutions and industrial growth in the region,” said Sibongiseni Khathi, TPL Chief Executive.
ZET is in an advanced stage of its capacity allocation process, with ongoing negotiations involving key stakeholders. The request for proposal process, initiated on 23 September 2024, has identified critical participants essential to the project’s success. More details on capacity allocation are available at: https://www.zululandenergyterminal.co.za/.
This LNG terminal represents a transformative step for South Africa, ensuring reliable energy supply, advancing the transition to cleaner fuels, and stimulating economic development in KwaZulu-Natal and beyond.
ENDS.
Issued by the Zululand Energy Terminal,
For more information: Email commercial@zlet.co.za or contact: Samukelisiwe Mabele +27 63 012 3673 / Mfundo Ndwandwe +27 83 555 7459