Vitol Invests in $3 Billion Gas-Fired Power Station and LNG Terminal in Durban

Global commodity trading firm Vitol is partnering with a consortium to develop a substantial $3 billion gas-fired power station and liquefied natural gas (LNG) import terminal at the port of Durban, South Africa, as confirmed by a company spokesperson.

Transitioning to Cleaner Energy

This initiative is a key component of South Africa’s strategy aimed at reducing dependency on coal-fired power generation, which currently contributes around 80% of the electricity in the nation’s industrial sectors. The shift toward gas is poised to enhance energy diversity and sustainability.

Market Expansion Opportunities

By entering this venture, Vitol is also positioning itself within a market that is targeting the addition of 16 gigawatts of new gas-fired generation capacity by 2039, as reported by Reuters.

Consortium Details

The consortium includes prominent players such as ACWA Power from Saudi Arabia, Vitol’s subsidiary Vivo Energy—which merged with Engen in 2024—and terminal operator VTTI.

Planned Features of the Project

In a report submitted to South African lawmakers, Vivo Energy and Engen detailed plans to invest in a combined-cycle gas turbine (CCGT) power plant capable of generating between 1,000 and 1,800 megawatts, alongside necessary LNG import infrastructure.

Expansion Plans for Durban Terminal

The development will take place as part of a larger master plan for the Durban marine terminal, which has earmarked 20 hectares for this purpose. While the project details are still being refined, the estimated cost remains around $3 billion, with no specified timelines or projected gas volumes disclosed yet.

A Vitol spokesperson commented, “The estimated cost is circa $3 billion. Regarding timing, it is not possible to say at this stage. We shall provide updates as and when we are in a position to do so.” It’s still early to determine the specifics of LNG cargo sourcing.

Comprehensive Approach to LNG Distribution

The project is set to extend its reach beyond mere power generation. Plans include distribution of regasified LNG via the Lilly gas pipeline connecting Secunda to Durban, LNG trucking services to off-grid industrial and mining customers, as well as LNG bunkering solutions for ships.

Investment Trends in Africa

This initiative is part of a broader investment strategy, which includes Vitol’s recent $2 billion agreement with the Uganda National Oil Company (UNOC) to support the expansion of the country’s petroleum infrastructure. Such strategic investments highlight Vitol’s commitment to aiding Africa’s transition towards cleaner and more diversified energy sources.