The Trade & Industrial Policy Strategies (TIPS) group has published its latest Foreign Direct Investment Tracker, detailing some of the major fixed investment projects planned for South Africa.

TIPS is an independent, non-profit, economic research institution established in 1996 to support economic policy development.

Its tracker shows 24 new projects were announced in the fourth quarter of 2021 with a total investment value of approximately R126 billion.

The bulk of the deals came from a single manufacturing project, a $4.6 billion (R70.5 billion) green ammonia export plant.

Most of the other projects fall under the fifth window of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

Some of the major projects are outlined in more detail below.

Ammonia plant 

Hive Hydrogen is a partnership between United Kingdom-based Hive Energy and South Africa’s Built Africa to establish a green ammonia export facility.

The plant will be developed for an estimated US$4.6 billion (R70.5 billion) at the Coega Special Economic Zone in the Eastern Cape.

The facility is expected to produce approximately 780 000 tonnes per year of green ammonia from hydrogen through a process using renewable energy and nitrogen extracted utilising an air separation unit.

The first phase should start operation in 2025 with full operation planned for 2026.

Ford 

Ford announced a R600 million investment towards upgrades at its Struandale engine plant in the Eastern Cape.

The bulk of the investment will be committed to the modernisation and expansion of the plant’s current assembly line, which supplies the 2.0L Single Turbo and 2.0L Bi-Turbo diesel engines.

Ford will also introduce production for a 3.0L V6 turbodiesel engine to power selected Ranger models. The project is in addition to an investment of R15.8 billion in the firms’ Silverton assembly plant.

Tetra Pak

Tetra Pak is a firm that processes and packages food and fruit juices, headquartered in Sweden.

The company announced plans to invest R500 million to upgrade and expand the firm’s factory in KwaZulu-Natal.

The plant will shift to green energy sources and introduce a new packaging technology that uses less energy and water.

Mining 

An Australian exploration and development mining firm, West Wits Mining, is developing the Witwatersrand Basin Project, an underground gold mine in Gauteng.

The Department of Mineral Resources and Energy (DMRE) approved the mining right application in July 2021.

A scoping study estimates total mine resources at about 29.1 million tonnes, an average steady-state annual production of 80 000 ounces for 18 years and a 22-year life-of-mine. The project will be implemented in five stages.

The first, development of the Qala Shallows mining area, is underway following the completion of a feasibility study in September 2021. It is expected to provide an estimated 40% of the total output. The estimated peak funding requirement for this stage is US$50 million (R767 million).

Renewable energy 

The Department of Mineral Resources and Energy (DMRE) has announced 25 projects as preferred bidders, of which 19 projects are led by or include foreign investors, as part of the Renewable Independent Power Producer Programme (REIPPP) plan.

These projects have a total estimated investment value of R38 billion and involve four major foreign firms.

The Ikamva consortium, led by Mainstream Renewable Power, will develop 12 of the projects. It will deliver 1.27 gigawatts (GW) from six onshore wind projects and six solar photovoltaic projects.

Collectively, the projects are expected to produce about 4 500 GW hours of renewable power. The onshore wind projects will be located in the Northern Cape, the Western Cape and KwaZulu-Natal while all the solar projects will be in the Free State.

EDF Renewables will be developing three wind energy facilities, the Coleskop, San Kraal and Phezukomoya projects. The first two are located in the Eastern Cape and the third in the Northern Cape. Each has an installed capacity of 140 megawatts (MW).

French renewables developer ENGIE and Pele Green Energy partner as the preferred bidders for three solar projects, each with 75-MW installed capacity. Two are in the Northern Cape, and the third is in the Free State.

Mulilo Renewable Energy and TotalEnergies were awarded preferred bidder status for the 75 MW Du Plessis Dam solar project in the Northern Cape.

Data centre 

American information technology firm Vantage Data Centers plans to invest $1 billion (R15.2 billion) in developing a data-centre campus at Waterfall in Gauteng with a capacity for 80 MW of critical information-technology load.

Construction of the facility is underway, with the completion of the first phase planned for 2022.

Once fully built, the campus will comprise three facilities over 12 hectares with 60,000 square meters of data-centre space. Vantage plans strong security for the site and will obtain power from Eskom.