Japanese resources company Marubeni Corp will pull out of the Thabametsi South African coal plant project, the Japanese group told Reuters on Wednesday, following the withdrawal of some South African investors this week.
Marubeni’s exit from the 630 megawatt (MW) Thabametsi coal-based power plant project in the water-scarce northern Limpopo province also follows the withdrawal of South Korea’s state-run Korea Electric Power Corp (KEPCO) last month.
“As per our policy that we will not develop any new coal power project, we are in process of the withdrawal from the (Thabametsi) project with the Government of South Africa,” a Marubeni spokesman said in response to questions from Reuters.
Earlier this week, South Africa’s biggest state pension fund manager the Public Investment Corporation (PIC), and the Industrial Development Corporation (IDC), told Reuters they would no longer support the project, which was planned to come online in 2021.
Marubeni, along with KEPCO, holds a joint 50% stake in the $2.1 billion coal plant that was to be built in the Limpopo province’s Waterberg region, which has reserves of coal amounting to between 40% and 50% of South Africa’s estimated 30 billion tonnes of remaining deposits, according to the Minerals Council South Africa.
The Thabametsi power plant was one of two private coal power projects which had their bids accepted in 2016 as part of government’s Independent Power Producer programme, aimed at easing crippling power shortages in South Africa.
[Mfuneko Toyana and Yuka Obayashi]