South Africa’s state-owned freight and ports operator, Transnet, has signed a 25-year terminal operator agreement with Ukwanda LNG to develop a major liquefied natural gas import terminal at the Port of Ngqura, marking one of the country’s largest energy infrastructure commitments in recent years.

The project is expected to attract about R22 billion ($1.3 billion) in investment and will include the construction of an onshore regasification facility and a dedicated LNG berth at the deepwater Eastern Cape port. Full commercial operations are targeted for 2035.

The agreement underscores South Africa’s accelerating shift toward natural gas as the country seeks alternatives to aging coal-fired power stations that still dominate the national grid.

Transnet positions ports for energy security

“This milestone represents a profound shift in how South Africa utilises its commercial seaports to support national energy security,” Transnet Group Chief Executive Officer Michelle Phillips said.

The deal positions the Port of Ngqura as a strategic energy gateway for Southern Africa. Located near Nelson Mandela Bay, Ngqura is South Africa’s newest and deepest container port and was designed as a transshipment hub serving global shipping routes.

The port is also regarded as one of the country’s most environmentally compliant maritime developments, having been built under strict environmental authorization standards.

*Michelle Phillips , Transnet Group Chief Executive Officer*

LNG investment momentum builds in South Africa

The Ukwanda LNG development adds momentum to South Africa’s emerging LNG market as global energy traders and infrastructure groups increase exposure to the country’s gas sector. Ukwanda LNG is a joint venture between Tamasa Energy Group and South Africa’s Strategic Fuel Fund, the state-owned energy security agency.

Vitol is backing a separate $3 billion LNG import project in Durban, while Dutch storage operator Vopak has delayed a final investment decision on another South African LNG terminal project until 2028.

Transnet’s strategic role in the economy

Transnet remains central to South Africa’s economic infrastructure, operating Africa’s largest rail network alongside the country’s eight commercial seaports and fuel pipelines.

The company has been under pressure to modernize logistics systems, improve freight efficiency, and reduce supply chain bottlenecks that have weighed on mining exports and industrial growth.

The Ngqura LNG project is expected to strengthen South Africa’s long-term energy resilience while supporting industrial expansion and regional trade integration.