Freeport Saldanha Industrial Development Zone (also known as Saldanha Bay Industrial Development Zone – SBIDZ) has signed a memorandum of understanding (MOU) with Sasol South Africa (Sasol) to facilitate a green hydrogen hub in Saldanha Bay.
Kaashifah Beukes, Freeport Saldanha CEO, Alan Winde, Premier of the Western Cape, and Councillor André Truter, Executive Mayor of Saldanha Bay Municipality, were present when the announcement was made at the opening of Africa Energy Week, in Cape Town yesterday, 18th October.
Under the terms of the MOU, the parties agree to collaborate and provide support in establishing a green hydrogen hub that will unlock new economic opportunities in the region and Western Cape, and in doing so, seek to collaborate on the project identification, preparation, pre-feasibility and feasibility assessments with a view of achieving a bankable and implementable project.
The MOU follows on the heels of a joint development agreement (JDA) signed between SASOL and ArcelorMittal South Africa (AMSA) on a project aimed at addressing emissions reduction targets and exploring new value pools through sustainable product streams, including the Saldanha green hydrogen and derivatives project. Two of South Africa's biggest industrial operators, SASOL and AMSA, seek to achieve net zero carbon emissions by 2050.
Beukes said, "Saldanha Bay has a strong strategic fit with Sasol's ambition to be a leading driver and contributor to the development of SA's green hydrogen economy. In addition, Freeport Saldanha is a strategic partner for SASOL and AMSA, adding value to their exploration of new markets by bringing together several stakeholders to drive catalytic investments in sustainable industrialisation and product streams."
AMSA, which is globally committed to ramping up its 'green' steel production, aims to be the first African green flat steel producer and will serve as the anchor customer of the envisaged facility, using green hydrogen to produce direct reduced iron (DRI) will significantly reduce the process carbon footprint.
The area's favourable renewables endowment, a growing local renewables industry, established world-scale industrial companies – like AMSA – and a developed, operational freeport and deep-water port are part of the reasons Saldanha makes a sensible investment location for this new market. “But moreover”, said Beukes, “the Freeport has the backing of the Western Cape Government and the Saldanha Bay Municipality to accelerate break out, inclusive economic growth in the Western Cape and utilise its assets, one being the SEZ, to achieve that aim.
“I welcome the signing of this exciting MoU between Sasol and the Freeport Saldanha Industrial Development Zone, as it lays the foundation for the development of an impressive green hydrogen hub, right here in the Western Cape, which has significant potential to increase energy resilience, attract investment and to create much needed jobs in the province,” added Minister Mireille Wenger.
Additional comments about Saldanha Bay:
- Apart from the Freeport and SEZ benefits, Saldanha Bay is also ideally situated to play a critical enabling role in developing the South African hydrogen economy due to the existing value chains, including rail and port infrastructures that form the Saldanha-Northern Cape and Saldanha – Cape Town Logistical Corridors.
- The Western Cape supports the national net-zero commitments and progress such as this shows commitment to the H2 Society Roadmap, and the DTIC’s Green H2 Panel, to develop a green H2 commercialisation strategy that includes Saldanha Bay.
- This is an important step of transforming our economy to a sustainable, greener path. Western Cape agricultural exports is another area of keen value to our economy. Producing green hydrogen at scale and working with private investors and others along the value chain, could realise green ammonia production and eventually more sustainable fertilizers for our growing agri sector. We have a long-term interest in the green hydrogen economy.
