The long-awaited localised industrial gas supply for the Eastern Cape has come one step closer to reality as Air Products South Africa broke ground on their latest capital investment – a first of its kind Air Separation Unit for the province – in Zone 3 of the Coega Development Corporation’s Industrial Development Zone (IDZ) today.
“When our feasibility study into the Eastern Cape showed that there was a high level of customer demand in this region, we spared no time. This reality set the wheels in motion for what is now a very proud, R300 million investment into South Africa’s leading Industrial Development Zone, Coega,” comments Mike Hellyar, Managing Director for Air Products South Africa.
The ground-breaking marks the start of a new era for industrial gas users in the Eastern Cape. The new Air Separation Unit (ASU) will be the first of its kind in the Eastern Cape and will bring increased economic development opportunities to the region.
“Over the years, and as a member of Remgro Limited, we have built a reputation for our commitment to safety and quality, our innovative culture and operational excellence” Hellyar explains. “Our expansion into the Eastern Cape reinforces these attributes and strengthens our resolve to continue our growth and market leadership position in the Southern African region.”
As the largest tonnage supplier of industrial gases in South Africa, Air Products will now be able to supply our Eastern Cape customers directly, with a full bouquet of process gases – oxygen, nitrogen, argon and carbon dioxide.
According to the company, the first phase R300-million investment will bring stability to the local gas sector and makes business sense given the industrial growth on track in the Eastern Cape. Air Products conducted a comprehensive market review and business case ahead of committing to the long term lease at the Coega IDZ.
“We chose the Coega IDZ after careful market analysis and are focused on committing to the growth and development of the region by providing a long-needed security of supply and value-added customer service,” Hellyar comments
Ayanda Vilakazi, Coega Development Corporation (CDC) spokesperson, said the investment showed commitment to socio-economic development in the region and reflected growing investor confidence in the IDZ.
“The impact this investment will have on the value chain in many industries – automotive, pharmaceutical, agro-processing and manufacturing is so significant that it will bring security of gas supply to the region and ensure that jobs along the value chain are protected,” said Vilakazi.
“This is what we call a catalytic investment, as it enables further investment both in the Coega IDZ and province. We are happy to welcome Air Products as a tenant that will service the gas needs of the broader Eastern Cape through the manufacture, supply and distribution of a diverse portfolio of atmospheric and speciality gases, equipment and other services.”
The CDC added that the new plant represents a major vote of confidence in the future of the Eastern Cape region. “Its strategic importance to local business, communities and industry cannot be underestimated. This investment is a swift and bold response to a clear market need.”
Air Products will design and construct a high efficiency and reliability plant that produces liquid oxygen and nitrogen – as well as installing strategic product storage facility on site for critical customers in the Eastern Cape – and has committed to using, as far as possible, local material and equipment suppliers in the construction of the air separation unit.
Hellyar adds that technology would be the backbone on which Eastern Cape expansion would be built. “The focus is on bringing technology and innovation to the region and using it to maximize customer service. Traditionally gas is supplied in either liquid or gaseous form. Air Products will now include a differentiated offering to what is conventionally available in the market by adding variable pressure and volume tanks to its services. The advance means more efficient delivery and engineering – lowering costs to customers, the organisation said.
The company also invests in a number of Corporate Social Investment projects related to the arts and culture, education as well as training and development, specifically focused on the development of children. We also provide opportunities for our local facilities to participate in these programs. In the Eastern Cape we have recently focused on a basic education initiative.
“The new ASU is sized to cater for market expansion and demand well into the future. This enduring view ensures the sustainability of Air Products’ investment in the Eastern Cape – but also continues to focus on customer service and satisfaction. Moreover it ensures that, should future demand increase, Air Products grows with the market.”
The building and installation of the new facility will commence in June 2013, with completion and commissioning planned for the third quarter of 2014.
Alan Straton
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