South Africa: Power Crisis Threatens to Sink Major Projects

Concern is growing that SA’s electricity crisis could tarnish its appeal to investors, after news that several new mining projects and a ferrochrome expansion project had been put on the back burner because Eskom lacked the power needed to run them.

A R22bn aluminium smelter — the biggest foreign direct investment secured by the country to date — also may be under threat, with Eskom confirming yesterday it may be delayed by supply constraints.
Chamber of Mines assistant adviser Dick Kruger said he could not give details, but there were platinum projects for which the mining companies had been told there was no power available.

A ferrochrome expansion plan had also been halted.

He said final decisions on new mining ventures were now likely to be delayed until there was certainty on power supply in 2013 — when Medupi, the first new coal-fired plant, comes on stream.

“We are in for a very hard five years,” Kruger said.

AllAfrica