South Africa fails to award first 2,000 MW gas-to-power tender

South Africa’s inaugural gas-to-power procurement program has failed to appoint any preferred bidders. The Department of Electricity and Energy announced that all four submitted proposals fell short of mandatory natural gas supply guarantees required by the Gas Independent Power Producer Procurement Program (GASIPPPP).

Although the bidding process attracted offers totaling 2,830 MW—exceeding the 2,000 MW target—the four participating consortia (Khanyazwe Flexpower, Pictor GTP, Kelvin Redevelopment, and Vutomi Energy/Komatipoort Power) could not provide sufficient assurances regarding fuel availability. The failure highlights growing concerns over South Africa’s gas supply outlook, particularly as declining imports from Mozambique threaten the domestic fuel base.

To address these energy security challenges, the government is moving forward with a liquefied natural gas (LNG) import terminal, with ExxonMobil and Eskom identified as anchor users. Officials stated that the procurement program will continue following further efforts to resolve infrastructure and commercial barriers.