S. Africa’s Sibanye Gold may spend USD 260m on solar capacity

South Africa’s Sibanye Gold Ltd is mulling investing ZAR 3 billion (USD 259m/EUR 227m) to build a 150-MWp solar power plant, as the gold producer aims to limit its reliance on state-run utility Eskom.

In a statement on Thursday, the company said it has concluded a pre-feasibility study into 2014 into the use of solar electricity as an alternative source of supply.

It is “contemplating a phased ZAR 3 billion investment” with the help of financial partners, said CEO Neal Froneman.

Sibanye estimates that its overall power demand will be 500 MW by 2017. Apart from solar power, it is also considering using coal-fired power plants, of up to 600 MW, as a power supply option over which it will have more control. “We are also engaging with technology partners in order to develop a deeper insight into independent power generation” Froneman said.

South Africa’s power supplier Eskom is facing huge challenges in meeting power demand. Earlier in February, it even resorted to rolling blackouts. For Sibanye Gold the “inconsistent and increasingly expensive power” from Eskom is a problem and it is working with the utility to manage and minimise the impact of load shedding on the operations.

So far, there has been no material impact on the company’s gold production forecast, it noted.


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