Coal producer Anglo American Thermal Coal’s (AATC’s) Khanyisa power project would be the first South African project of its kind using circulating fluidised-bed (CFB) technology, AATC project manager Julian Eslait said at a Fossil Fuel Foundation fluidised-bed combustion and gasification workshop, held in Johannesburg last week.

CFB technology was internationally proven, but had not yet been implemented for such an application locally, he said.

“However, AATC is facing numerous challenges relating to implementing a CFB power project in South Africa,” Eslait added.

The Khanyisa power project involves the building of a 450 MW power generation plant, located on the site of AATC’s Kleinkopje colliery, in Mpumalanga. It will be fuelled by discard coal provided by AATC and will function as an independent power producer (IPP).

Eslait stated that the IPP model was chosen for the project, as it provided the best alignment with Anglo American’s group strategy.

To ensure competitive bidding, off-the-shelf technology had been specified, with the minimum function specification requiring three 150 MW CFB boiler units and dry cooling, he said.

The initial plan was for group company Anglo American Platinum (Amplats), as the sole offtaker for all the electricity from the proposed 450 MW Khanyisa power project, to carry the power purchase agreement (PPA) on its balance sheet as a $1-billion finance lease.

However, Mining Weekly reported in May that under the platinum sector’s circumstances at the time, the level of commitment to Amplats’ balance sheet was deemed inappropriate and, therefore, the project had been deferred.

Although it had been decided that the offtake agreement would be shared with a third-party offtaker to avoid the signifi- cant financial lease impact on Amplats, this offtaker was yet to be chosen, Eslait said.

He added that the initial commercial operations date for the project had been 2015, but owing to the challenges faced by the project, it would probably go into production only in 2017.

These challenges included the strategic rationale and appropriate structure of the project, as Anglo American was a resource company, issues pertaining to the project site, the securing of long-term access to fuel and regulatory issues pertaining to third-party use of the transmission network, he said.

Finding a suitable site for the project was a difficult task, as the eMalahleni area had been mined for more than 100 years.

“Identifying a nonundermined stable site [that is] big enough for the power station and close enough to fuel and water sources was a challenge. The only suitable site in the area is traversed by a provincial road, which would have to be deviated,” he said.

Further, two families living near the proposed project site would have to be relocated. Two 22 kV power lines and a freshwater pipeline, supplying water to Kleinkopje colliery, also traverse the site, which would also have to be diverted.

Further, 118 graves were located inside the servitude of an Eskom 400 kV power line on the southern boundary of the project site. However, this area would be fenced off and left undisturbed.

Another challenge faced by the project was that the IPP’s lifespan of 25 years would outlast the life cycles of the coal mines in the area. However, to secure access to fuel sources, mining rights would be retained over the Klippan mine dump after mine closure, Eslait explained.

Further support was required from several regulatory bodies to enable the project to overcome regulatory challenges, Eslait pointed out.

The Khanyisa power project holds many potential benefits for South Africa, such as bringing new technology to the country.

Further benefits include an additional 450 MW of power generation, which can assist in relieving some of Eskom’s capacity constraints at no extra cost to the power utility, and the conversion of a waste product into electricity.

The project will also create 900 to 1 200 direct jobs during its construction period, with 100 permanent direct jobs to be created when the project goes into operation.

Meanwhile, Khanyisa would be environmentally friendly because it would reduce the environmental impact of discard coal dumps. The sulphur oxide and nitrogen oxide emissions would be lower than those of existing coal-fired power stations and the water used at the power plant would be reclaimed from underground mine workings, said Eslait.