South Africa: Zululand Energy Terminal launches EPC expression of interest process

Zululand Energy Terminal Seeks EPC Partners for South Africa’s First LNG Import Facility

The Zululand Energy Terminal (ZET) has opened a formal call for expressions of interest (EOI) from engineering, procurement and construction (EPC) contractors interested in building the country’s inaugural liquefied natural gas (LNG) import terminal at Richards Bay Port. The initiative marks a pivotal step in South Africa’s drive to diversify its energy supply and enhance energy security.

Project Overview

ZET is a joint venture between Vopak Terminal Durban and Transnet Pipelines. Under a 25‑year concession agreement, the consortium will design, develop, construct, finance, operate and maintain the terminal in the South Dunes Precinct of the Port of Richards Bay.

The planned facility will:

• Receive, store and regasify LNG cargoes.
• Feed regasified gas into emerging industrial and power‑generation hubs.
• Serve as the primary gateway for LNG imports into South Africa.

By enabling LNG imports, ZET aims to reduce reliance on coal‑fired generation, support the country’s decarbonisation goals, and provide a flexible feedstock for petrochemical and manufacturing sectors.

Expression of Interest Process

The EOI, issued on 2 May 2025, invites qualified EPC contractors to demonstrate their capability to deliver a complex marine‑based LNG infrastructure project. Submissions must be received:

• In person at the ZET offices in Richards Bay by 9 July 2026, 17:00 SAST; or
• Electronically via the protected email address [email protected].

The EOI represents the first stage of a three‑phase selection workflow:

1. Expression of Interest (EOI) – shortlisting contractors that meet baseline technical, financial and localisation criteria.
2. Request for Information (RFI) – deeper evaluation of capabilities, past LNG‑related projects and compliance with South African content policies.
3. Request for Proposal (RFP) – final bid stage where price, schedule and risk‑allocation are negotiated.

This structured approach is designed to promote transparency, fair competition and optimal value for the ZET consortium.

Technical and Localization Requirements

Applicants must satisfy a set of minimum requirements, which include:

• Proven experience in EPC delivery of LNG import terminals or comparable marine gas‑handling facilities (minimum two projects of ≥ 1 Mtpa capacity).
• Financial stability demonstrated through audited statements for the last three fiscal years.
• Commitment to ZET’s localisation agenda: a minimum of 30 % of contract value to be sourced from South African suppliers, coupled with a skills‑development plan that targets at least 15 % local labour participation.
• Adherence to international safety and environmental standards (e.g., ISO 45001, ISO 14001, SIGTTO LNG handling guidelines).

Successful contractors will be entered into ZET’s supplier database and may be invited to participate as prime contractors or specialised subcontractors in later phases of the project.

Strategic Importance for South Africa’s Energy Mix

South Africa’s current energy portfolio remains heavily weighted toward coal, which accounts for roughly 85 % of electricity generation (Department of Mineral Resources and Energy, 2023). The Integrated Resource Plan (IRP) 2023 calls for a gradual shift toward cleaner fuels, with LNG earmarked as a transitional gas to support peaking power plants and industrial demand.

By providing a dedicated LNG import terminal, ZET will:

• Enable the import of up to 3.5 Mtpa of LNG in the initial phase, scalable to 6 Mtpa.
• Support the development of downstream gas infrastructure, including pipelines to the Sasol Secunda complex and prospective power‑generation sites in KwaZulu‑Natal.
• Contribute to job creation: the construction phase is projected to generate approximately 2 500 direct and indirect positions, with a focus on up‑skilling local artisans and engineers.

Industry analysts note that South Africa’s first LNG terminal could reduce the country’s reliance on expensive diesel‑based peaking plants by as much as 15 % once fully operational (McKinsey & Company, 2024).

Next Steps and Timeline

Following the EOI deadline, ZET will:

• Complete a preliminary evaluation by late August 2026.
• Issue RFIs to shortlisted parties in September 2026.
• Release the final RFP in Q1 2027, with contract award anticipated mid‑2027.
• Commence construction shortly thereafter, targeting commercial operation by 2030.

Stakeholders, including local municipalities, environmental groups and potential off‑takers, will be consulted throughout the process to ensure alignment with national development objectives and environmental stewardship.

References

• Department of Mineral Resources and Energy. (2023). Energy Statistics South Africa 2023. Pretoria: DMR.
• Vopak Terminal Durban. (2024). Joint Venture Overview: Zululand Energy Terminal. Retrieved from https://www.v