BW Energy has postponed the final investment decision (FID) on its long-delayed Kudu gas-fired power project in Namibia until 2025, two company sources said on Thursday.
“It’s true, we have postponed the final investment decision,” one of the sources said without giving further details. Both sources declined to be named because they were not authorized to speak to the media.
BW Energy did not immediately respond to a request for comment.
BW Energy previously told Reuters that the investment decision was expected by September this year and that gas commissioning was planned 30 to 40 months later.
Seen as essential to strengthening the security of electricity supply in this southern African country, as well as in the wider region, the Kudu gas-to-electricity project has struggled to get off the ground for years, mainly in due to its cost and technical complexity.
With proven reserves of about 1.3 trillion cubic feet of gas, the Kudu offshore field has remained dormant since its discovery by Chevron in 1974, some 80 miles from the nearest land, near the port of Luderitz.
Oslo-based BW Energy is targeting an 800 megawatt plant, with an initial phase of 420 MW, with about half of the electricity going to Namibia and the rest to supply regional markets.
The second phase would be built based on South Africa’s “huge appetite” for Kudu energy, BW Energy said in June, adding that some companies are also looking for natural gas and LNG to replace diesel and “which we are ready to supply as soon as we can confirm the existence of additional gas resources”.
BW Energy intends to use a repurposed semi-submersible drilling rig as a floating production unit to reduce costs and accelerate development, which includes a gas pipeline, power plant, transmission line and an LNG installation.
